Avanti Feeds Q1 FY27 Earnings Call — Analysis (NSE: AVANTIFEED)

Severe raw material cost inflation in fish meal and soya bean meal compressed Q1 PBT by 37% YoY despite strong 17% volume growth in the core feed segment.

28 Aug 2026 · Analysis by Alpha Inflection

Result quality: watch — Margin pressure. Management sentiment: neutral.

The take

Q1FY27 Consolidated Gross Income ₹1,966 Cr ( +19% YoY ) . New guidance — FY27 shrimp feed sales volume 5,85,000 MTs . New story: Value Chain Price Balancing & Regulation .

Results

Consolidated gross income grew 19% YoY to ₹1,966 Cr (+30% QoQ) while PBT fell 37% YoY to ₹157 Cr (-15% QoQ) due to sharp input cost escalation.

Financial highlights

Guidance

Management expects FY27 feed sales of ~5,85,000 MT and shrimp exports of ~19,000 MT with total planned pet food capex of ~₹175 Cr.

What management committed to

• It is estimated that the feed sales during FY27 would be around 5,85,000 MTs. — 5,85,000 MTs, FY27
• It is estimated that exports [of processed shrimp] during FY27 would be around 19,000 MTs. — 19,000 MTs, FY27
• We are estimating around INR 175 crores investment in a pet food [facility near Hyderabad]. — INR 175 crores
• [Pet food] Construction activity will commence upon receipt of the necessary [Consent for Establishment] approval. — upon receipt of the necessary approval

Key themes

Raw material inflation and margin compression

How the narrative shifted

• Raw Material Cost Escalation: Steep, unprecedented price increases in fish meal and soybean meal are putting acute pressure on feed margins, requiring formula optimisation and government engagement.
• Value Chain Price Balancing & Regulation: Management is coordinating with state authorities and farmer bodies to institute a pricing formula that balances farmer viability with feed producer profitability.
• Pet Care Business Diversification: PetCare division is scaling branded distribution (Avant Furst) across channels while advancing plans for an owned ₹175 Cr manufacturing plant.
• US Tariff and Export Realisations: Shrimp processing margins held steady due to foreign exchange and pricing, while US reciprocal tariff refunds await regulatory clearance of ADD/CVD suspensions.

Operational commentary

• Implemented ~10% shrimp feed price hike around mid-June 2026 to partially offset raw material price increases.
• Pet Food project: Acquired land near Hyderabad for ₹25 Cr (converted to non-agriculture use); Consent for Establishment (CFE) submitted and under approval.
• Andhra Pradesh state government constituted a committee involving a Big Four consulting firm to devise a price indexation/balancing mechanism for feed raw materials and farm-gate prices.
• US Reciprocal Tariff refund claim of ~$15-20M remains on hold/pending processing by US CBP due to ongoing ADD/CVD review suspensions.

Analyst Q&A

• Q. What is the status of the estimated $15-20M US reciprocal tariff refund?

  Customs declarations have been filed, but CBP will not process the refunds until the ADD and CVD suspension status is formally lifted.

• Q. Given severe raw material inflation, what price hikes have been taken and can further hikes be passed on?

  A ~10% price hike was taken in mid-June; further hikes require balancing farmer viability with feed industry sustainability under state government oversight and committee deliberations.

• Q. What is the capex outlook for the pet food segment?

  Estimated capex is ~₹175 Cr, of which ₹25 Cr has been deployed for land acquisition with construction pending CFE approval.

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