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Avanti Feeds: A Stellar Performance
May 17, 2017

Avanti Feeds has announced the fourth quarter results of financial year 2016-2017 (4QFY17). The company has reported a 50.3% YoY increase in the topline while the bottomline increased by 168.6% YoY. Here is our analysis of the results.

Performance summary
  • Revenues increased by 50.8% YoY led primarily by the Shrimp feed division. The shrimp processing division grew by 56% YoY while the Shrimp processing business rose by 14% YoY. Revenue from exports increased by 14% YoY and revenue from the domestic market increased by 56% YoY during the quarter.
  • Operating profits increased by whopping 170.1% YoY. Operating profit margin increased by 8.1% and stood at 18.3% during the quarter. This is due to benign increase in raw material cost and other expenses compared to revenue growth during the quarter.
  • Net profits sharply increased by 168.6% YoY. This is on the back of an increase in operating profit and other income. This was partly offset by a sharp increase in depreciation, finance cost and minority interest.
  • The company declared a dividend of Rs 9 per share for FY17 (dividend yield of ~ 0.75%).

    Consolidated Financial Snapshot
    (Rs m) 4QFY16 4QFY17 Change FY16 FY17 Change
    Net sales 4,637 6,993 50.8% 19,953 27,020 35.4%
    Other operating income 51 51 0.7% 230 307  
    Total Income 4,688 7,044 50.3% 20,183 27,327  
    Expenditure 4,214 5,763 36.8% 17,885 24,030 34.4%
    Operating profit (EBDITA) 474 1,281 170.1% 2,298 3,297 43.5%
    Operating profit margin (%) 10.2% 18.3%   11.5% 12.2%  
    Other income 44 80 83.3% 166 218 31.8%
    Interest 8 22 178.3% 18 27 47.5%
    Depreciation 25 38 51.3% 102 137 33.9%
    Exceptional items -8     39 1 -98%
    Profit before tax 477 1301 172.7% 2382 3352 41%
    Tax 156 404 159.3% 792 1,084.34 37%
    Effective tax rate 32.7% 31.1%   33.3% 32.4%  
    Profit after tax/(loss) 321 897 179.2% 1,590 2,267 42.6%
    Share of net profit /(loss) of associates -9 -23   -15 -13  
    Minority Interest   -35     -111  
    Net profits 312 839 168.6% 1,575 2,143 36.1%
    Net profit margin (%) 6.7% 12.0%   7.9% 7.9%  
    No. of shares (m)         45.4  
    Fully diluted EPS (Rs)*         47.2  
    P/E (x)*         25.6  

    *Based on trailing 12-months earnings

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Equitymaster Agora Research Private Limited (hereinafter referred to as "Equitymaster"/"Company") was incorporated on October 25, 2007. Equitymaster is a joint venture between Quantum Information Services Private Limited (QIS) and Agora group. Equitymaster is a SEBI registered Research Analyst under the SEBI (Research Analysts) Regulations, 2014 with registration number INH000000537.

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