Mehabe score: 4 G Factor: 4 Piotski Score: 6 The stock has a rating HOLD. The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 4 and Piotski score of 6.
Description
Avanti Feeds is a leading provider of high quality shrimp feed, best technical support to the farmer and caters to the quality standards of global shrimp customers.#
Main Points
Shrimp Feed Business (78% of revenues)#
The company is the largest producer of shrimp feed in India with a market share of ~45% in the domestic feed business.#
It sold ~485,000 Tonnes of shrimp feed in FY20 which translates to ~81% capacity utilization.#
The feed is sold in India and Bangladesh.Site:AVANTIFEEDMain Symbol:AVANTI
Stock trades at 628.0, above its 50dma 581.94. It also trades above its 200dma 525.97. The stock remains bullish on techicals
The 52 week high is at 675.00 and the 52week low is at 410.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
– has a good return on equity (ROE) track record: 3 Years ROE 23.04%
– has been maintaining a healthy dividend payout of 21.20%
-‘s median sales growth is 29.71% of last 10 years
Weakness
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Competition
– The industry trades at a mean P/E of 28.6x. Unique Organics trades at the industry’s max P/E of 166.6x. AVANTIFEED trades at a P/E of 26.5x
– Industry’s mean G-Factor is 3.6 while the mean Piotski score is 7.0. AVANTIFEED has a G-Factor of 4 and Piotski scoreof 6.
– Average 1 month return for industry is 15.7%. The max 1- month return was given by Tanvi Foods: a return of 75.2 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 1098.0 cr compared to Rs 1035.0 cr for period ended Mar 2020, a rise of 6.1%
Operating Profits reported at Rs 85.0 cr for period ended Mar 2021 vis-vis 125.0 for period ended Mar 2020 .
Operating Margins contracted -433.6 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 5.12 compared to Rs 5.5 for previous quarter ended Dec 2020 and Rs 6.38 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 4101.0 cr for period ended Mar 2021 vis-vis sales of Rs 4115.0 cr for the period ended Mar 2020, a fall of 0.3%. The 3 year sales cagr stood at 6.5%.
Net Profit reported at Rs 360.0 cr for period ended Mar 2021 vis-vis sales of Rs 346.0 cr for the period ended Mar 2020, rising 3.9%.
Company reported a poor Net Profit CAGR of -6.9% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 383.0 cr for period ended Mar 2021 vis-vis Rs 178.0 cr for period ended Mar 2020
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The stock has given a return of 41% on a 1 Year basis vis-vis a return of 11% over the last 3 Years. – The compounded sales growth on a TTM bassis is -0% vis-vis a compounded sales growth of 7% over the last 3 Years. – The compounded profit growth on a TTM basis is -5% vis-vis a compounded profit growth of -10% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 17.57% vis-vis 17.65% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 31.66% vis-vis 32.81% for Mar 2021
Conclusion
– is almost debt free.
– has a good return on equity (ROE) track record: 3 Years ROE 23.04%
– has been maintaining a healthy dividend payout of 21.20%
-‘s median sales growth is 29.71% of last 10 years –
The business fundamentals of the stock remain stable. Stronger near term results will build interest in the stock. We suggest to wait for a upturn in business performance.
Technically, the stock remains above its 50 DMA 581.94 and is trading at 628.0, thus bullish price action wise.
