Avanti Feeds stock slips 3%; Co fixes record date for stock split and bonus issue


Shares of Avanti Feeds slipped ~3.5% on the BSE in noon trade on Wednesday.

The company has fixed June 27 for sub-division of equity shares from a face value of Rs2 each to Re1 each and issue of bonus equity shares of Re1 each in the ratio of 1:2.

At 12:49 PM, shares of Avanti Feeds were trading at Rs1,671.90, down Rs58.9, or 3.4%, from their previous close of Rs1,730.80 on the BSE.
The scrip opened at Rs1,709 and has touched a high and low of Rs1,755 and Rs1,662.40, respectively.

Avanti Feeds is a leading manufacturer and exporter of shrimp feeds and processed shrimp. It also operates windmills with an installed capacity of ~3.2 megawatts in Karnataka. It derived ~83% revenue from shrimp feeds and ~17% revenue from processed shrimp during FY18. The total feed capacity stands at six lakh tonnes per annum as of March 31, 2018.

Indian shrimp export is set to nearly double to Rs45,000cr by FY22E driven by strong demand and improved product mix, as per industry reports. This is further backed by the FY18-19 Union Budget allocation of Rs10,000cr to the aquaculture and fishery industry. Overall, we see revenue CAGR of ~17% over FY18-20E.

Also, the management is aiming to increase its market share to 50-55% (current ~46%) over FY18-20E. We expect EBITDA to decline to ~17% by FY20E owing to the levy of anti-dumping duty, thus resulting in lower levels of margin on exports. Overall, we see PAT CAGR of ~20% over FY18-20E. It is virtually a debt-free company, which lends it financial stability.

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