# 1. Financial Performance ## A. Key Figures * **Gross Income:** ₹1,659 Cr Q2 FY26 (+75% YoY) · ₹3,316 Cr H1 FY26 (+1% YoY) * **PBT:** ₹53 Cr Q2 FY26 (+117% YoY) · ₹78 Cr H1 FY26 (+59% YoY) ## B. Revenue Growth * **Robust Quarterly Momentum:** Gross income surged **75% YoY** in Q2, reflecting strong demand and volume recovery, despite minimal sequential growth. * **H1 Volume-Driven Expansion:** First-half gross income growth supported by **2,880 MT higher sales volume**, underscoring operational scale-up in key divisions. * **Sustained PBT Acceleration:** Profit before tax nearly doubled YoY in Q2, driven by **higher sales volumes, improved price realization, favorable FX, and lower freight costs**. ## C. Profit Margins * **Feed Sector Margin Pressure:** Despite YoY PBT growth, margins in the feed business are expected to moderate, with a projected range of **9–10%**, as cost dynamics and mix offset top-line gains. * **Targeted Profitability:** Management views **10% margin** as an achievable full-year target, balancing volume growth with pricing discipline. ## D. Cash Flow Trends * **Recurring Other Income:** Non-operating income remains stable, primarily from **interest on mutual funds, fixed deposits, and investment portfolios**, classified as sustainable. * **FX Gains as Income Contributor:** A notable portion of other income in the Frozen segment stems from **realized gains on forward contracts**, linked to currency volatility. --- # 2. Volume & Sales Trends ## A. Key Figures * **Feed Sales Volume (Q2 FY26):** **154,644 MT** (vs. 165,564 MT Q1 FY26 · +14.6% YoY) * **Feed Sales Volume (6M FY26):** **320,208 MT** (+9.1% YoY) · **Full-Year FY26 Projection:** **575,000 MT** ## B. Feed Sales Volume * **Sequential Dip, Strong YoY Growth:** Q2 volumes declined sequentially due to **seasonal reduction** in feed consumption from Q1 to Q4, but reflect robust double-digit year-on-year growth. * **Full-Year Trajectory Intact:** H1 performance supports the **575,000 MT** full-year sales projection, indicating sustained market demand and operational execution. * **Market Expansion Outlook:** Shrimp production in 2025 expected to reach **700,000–800,000 MT**, driving estimated feed consumption of **2–3 million MT**, signaling strong sector tailwinds. --- # 3. Product & Segment Performance ## A. Key Figures * **Feed Division Gross Income:** ₹1,200 Cr Q2 FY26 (–6.2% QoQ) · ₹2,479 Cr 6M FY26 (+86% YoY) * Feed Division PBT: ₹180 Cr Q2 FY26 (–19.64% QoQ, +24.14% YoY) · ₹404 Cr 6M FY26 (+35.57% YoY) * **Shrimp Processing Gross Income:** ₹462 Cr Q2 FY26 (+22% QoQ, +62% YoY) * Pet Care Sales: ₹95.08 Lakh Q2 FY26 (vs. ₹38.17 Lakh Q1 FY26) ## B. Feed Division * **Resilient Volume Growth:** Despite seasonal QoQ decline, Feed Division delivered strong YoY volume and income growth, supported by lower raw material costs and improved overhead absorption. * **Strategic Shift to Value-Add:** Company is actively prioritizing **value-added products** to capture higher-margin opportunities and sustain profitability. * **Stable Market Leadership:** Maintains dominant **51–53% market share**, with expectations to hold around **52–53%** amid stable competitive dynamics. ## C. Shrimp Processing * **Outperformance on Volume & Pricing:** Division posted robust QoQ and YoY growth, driven by a significant **1,439 MT volume increase**, higher realizations, and favorable forex. * **Value-Add & Sustainability Focus:** Strategic emphasis on **value-added products and sustainable farming** is enhancing margins and long-term industry positioning. * **Strong Execution:** Over **41% growth** in processing, potentially aided by pre-shipment activity, underscores operational strength despite limited disclosure on timing factors. ## D. Pet Care Business * **Encouraging Commercial Launch:** Pet care segment off to a strong start with **positive market response** for both cat and dog food, despite low base sales. * **Product & Channel Expansion:** Successful rollout of **ocean fish and tuna cat food**, followed by **chicken-vegetable dog food** targeting the largest pet food segment (~65%). * **Multi-Channel Go-to-Market:** Leveraging **e-commerce, distributors, and digital marketing** (via @AvantFurst) to scale reach amid a competitive landscape led by Mars and Drools. * **Path to Scale:** Despite **high initial costs**, company expects gradual volume ramp-up and brand building to secure meaningful market presence. --- # 4. Input Costs & Margin Pressure ## A. Key Figures * **Fish Meal Price:** **₹97/kg** Q2 FY26 · **₹93/kg** Q1 FY26 · **₹105/kg** Q2 FY25 (current: **₹125/kg**) * **Soya Bean Meal Price:** **₹42/kg** Q2 FY26 · **₹38/kg** Q1 FY26 · **₹49/kg** Q2 FY25 (current high-grade: **₹47/kg**) * **Wheat Flour Price:** **₹33/kg** Q2 FY26 · **₹31/kg** Q1 FY26 · **₹32/kg** Q2 FY25 (current: **₹32–33/kg**) * **Soya MSP Increase:** **₹3/kg** hike, with binding procurement in Maharashtra * **Soya Production Decline:** **~10%** drop due to excessive rainfall ## B. Raw Material Cost Dynamics * **Upward Price Trajectory:** Significant and broad-based increases in fish meal, soya, and wheat costs driven by supply constraints, policy mandates, and export demand. * **Export Market Distortion:** Domestic fish meal supply is under pressure as exporters secure **₹160–175/kg** with incentives, creating scarcity and pushing current procurement to **₹125–130/kg**. * **Soya Supply Squeeze:** Combined impact of **10% lower production**, higher MSP enforcement, and government procurement is tightening market availability, with prices expected to remain elevated until **February–March**. * **Wheat Supply-Demand Shift:** Despite a strong harvest expected, resumption of exports is likely to reduce domestic availability and **exert upward pressure on prices**. ## C. Margin & Pricing Strategy * **Partial Cost Pass-Through Achieved:** EBITDA per kg has improved over the past four quarters, indicating some success in offsetting input cost inflation despite limited pricing power. * **Pricing Constraints Persist:** Management views further feed price increases as highly unlikely, limiting ability to fully pass through rising raw material costs. * **Duty Pass-Through Necessity:** A **50% duty** is deemed non-absorbable, requiring full transfer to consumers, though impact on demand is still being evaluated. --- # 5. Export & Market Diversification ## A. Key Figures * **Frozen Shrimp Exports:** **741,529 MT** volume ($5,177 Mn value) FY24-25 * **B. S. Imports of Indian Shrimp:** **311,948 MT** (largest market) * **Export Mix:** **6%** quantity share · **46%** USD earnings share * **Volume Growth (Recent):** **14,149 MT** reported, up from 13,444 MT (+56% YoY) ## B. U.S. Tariff Impact * **Tariff Relief in Sight:** Bilateral trade progress between India and the U.S. includes proposed near-zero tariffs on select food and dairy, signaling potential spillover benefits for aquaculture. * **Cost Pass-Through Executed:** All orders from Q3 onward fully incorporate current U.S. tariff costs, insulating margins from near-term duty volatility. ## C. Global Export Mix * **Strategic Diversification Underway:** Despite strong North American demand, U.S. volume share is declining as the company actively expands into alternative geographies to de-risk exposure. * **E-Commerce Expansion Accelerating:** Market reach now extends to Tier 2/3 cities; Supertel live and **Amazon launch planned by November 2025** to boost digital distribution. * **Demand Fundamentals Intact:** Global shrimp demand remains resilient, driven by health trends, retail/food service growth, and rising appetite for value-added seafood. ## D. Non-U.S. Market Growth * **Domestic Market Push Amplified:** Government initiatives—including military supply integration, NFDB involvement, and national health campaigns—are boosting local shrimp consumption to offset export headwinds. * **Sustainable Growth Trajectory:** Industry outlook remains positive, supported by balanced expansion across non-U.S. markets, product innovation, and policy tailwinds. --- # 6. Capacity & Expansion ## A. Key Figures *No significant quantitative financial metrics available for extraction.* ## B. Pet Food Facility * **Strategic Market Entry:** Advancing into pet food via technical trials of imported fish feed under Indian conditions to evaluate commercial viability ahead of domestic production. * **Scaled Production Timeline:** Domestic manufacturing unit targeted for completion by **end-FY27**, enabling scaled output and market rollout. * **Market Assessment Ongoing:** Multi-quarter evaluation of fish and pet feeder market dynamics, including size and positioning, though no quantitative results disclosed. ## C. Land Acquisition * **Greenfield Site Secured:** Acquired **~30 acres near Hyderabad**, reclassified for industrial use, to build a state-of-the-art pet food manufacturing facility. * **Project Development in Motion:** Technical discussions with **Bluefalo** ongoing; land development active, with detailed project report and construction approvals to follow. --- # 7. Risks & Commodity Volatility ## A. Key Figures * **Indian Fish Meal Export Price Floor:** **INR 125–130** (current support level) ## B. Raw Material Swings * **Supply Chain Disruption:** Global fish meal shortages—driven by weak Peruvian and Chilean catches—are fueling export-driven diversion of Indian production, tightening domestic availability. * **Price Volatility Ahead:** Near-term profitability remains exposed to raw material costs, with margin pressure likely unless supply stabilizes post-Chilean export quota announcement. * **Climate & Biology as Key Risks:** Agricultural output, aquaculture health, and climate patterns continue to materially influence feed demand and input cost volatility. ## C. U.S. Trade Policy * **Stable Outlook:** Initial tariff-related farmer concerns have eased, with aquaculture activity and sentiment remaining resilient heading into FY26. ## D. Farm Input Availability * **Farmer Confidence Intact:** Strong farmgate prices are supporting producer profitability and confidence ahead of the February cultivation cycle. --- # 8. Guidance & Outlook ## A. Key Figures * **FY26 Shrimp Export Target:** **17,000 MT** (scenario-based) · **75 LMT** FY26 feed sales guidance * **Export Promotion Mission (EPM):** **INR 25,000 Cr** outlay over five years ## B. FY26 Sales Targets * **Robust Export Trajectory:** FY26 shrimp export target reflects sustained growth momentum, underpinned by market resilience despite evolving tariff landscape. * **Feed Sales Scaling:** Feed business poised for significant expansion with sales guidance indicating strong downstream demand, unaffected by seasonal consumption volatility. * **Policy Catalysts Ahead:** Support policy expected within 1–2 months, potentially aligning with next farming season to boost sectoral confidence. ## C. Margin Expectations * **Margin Uncertainty Persists:** FY26 feed EBIT margins may not return to historical 10–12% range, remaining pressured by raw material trends and H1-level dynamics. ## D. Tariff Contingency Plan * **Near-Term Headwinds:** Final quarter of CY25 forecasted as challenging due to rising input costs and unresolved U.S. reciprocal tariff risks. * **Strategic Government Intervention:** INR 25,000 Cr EPM launched to counter trade barriers, with priority support for marine exports to protect market access and jobs. * **Cautious Outlook Retention:** Company maintains current FY26 volume forecast despite tariff overhang, though reassessment possible if U.S. duties persist beyond January. * **Refund Prospects Dismal:** Management views tariff-related refunds as highly speculative and unlikely, with any potential liability expected to be passed through.