Avanti Feeds Q4FY23 Earnings: Strong Growth in Net Profit and Margin
Avanti Feeds Ltd., one of the leading shrimp feed manufacturers and exporters in India, announced its Q4FY23 earnings on May 24, 2023. The company reported robust growth in net profit and margin, despite a decline in revenue year-on-year (YoY) and quarter-on-quarter (QoQ).
Key Highlights of Q4FY23 Earnings
- Net profit at ₹93.3 cr vs ₹84.3 cr (YoY); ₹62.4 cr (QoQ), up by 10.7% YoY and 49.5% QoQ
- Revenue at ₹1093 cr vs ₹1332.2 cr (YoY); ₹1102.6 cr (QoQ), down by 18% YoY and 0.9% QoQ
- EBITDA margin at 12.2% vs 8.7% (YoY); 7.3% (QoQ), up by 350 basis points YoY and 490 basis points QoQ
- EPS at ₹5.77 vs ₹5.21 (YoY); ₹3.86 (QoQ), up by 10.7% YoY and 49.5% QoQ
Reasons for Growth in Net Profit and Margin
The company attributed the growth in net profit and margin to the following factors:
- Improved operational efficiency and cost optimization
- Higher realization from export markets due to strong demand and favorable exchange rate
- Lower raw material prices due to higher availability of domestic soybean meal
- Better product mix with higher contribution from value-added products
- Lower finance cost due to debt reduction
Outlook for FY24
The company expects to maintain its growth momentum in FY24, driven by the following factors:
- Increasing domestic consumption of shrimp due to rising awareness and affordability
- Expanding export markets with new product launches and certifications
- Enhancing production capacity and distribution network
- Investing in R&D and innovation for product development and quality improvement
- Strengthening farmer relationships and technical support services
Conclusion
Avanti Feeds Ltd. has delivered a strong performance in Q4FY23, despite the challenges posed by the Covid-19 pandemic and cyclone Tauktae. The company has demonstrated its resilience and adaptability in the aquaculture industry, which is expected to grow at a CAGR of 7.2% during 2020-2025. The company has a market leadership position with a market cap of ₹5,027 cr and a P/E ratio of 18.65, which is lower than the sector P/E of 26.81. The company also has a healthy balance sheet with a P/B ratio of 2.35 and a dividend yield of 1.69. The company is well-positioned to capitalize on the opportunities in the domestic and international markets and create value for its shareholders.
Disclaimer:
This blog post is for informational purposes only and does not constitute any investment advice or recommendation. The author is not a SEBI-registered investment adviser and does not have any affiliation or interest in Avanti Feeds Ltd. or its products. The author does not guarantee the accuracy, completeness, or timeliness of the information provided in this blog post. The readers are advised to do their own research and due diligence before making any investment decisions involving Avanti Feeds Ltd. or any other company. The readers are solely responsible for their own actions and outcomes.