Coastal Corporation Limited (CCL) is a prominent Indian seafood processor and exporter, currently ranked among the **top ten global players** in the shrimp industry. Operating as a **100% Export-Oriented Unit (EOU)**, the company is vertically integrated, managing the journey of premium shrimp from the aquaculture hubs of Andhra Pradesh to high-end retail and food service segments across the globe. The company is currently undergoing a strategic transformation, evolving from a pure-play seafood exporter into a diversified conglomerate with interests in **Value-Added Products (VAP)** and **Renewable Energy (Ethanol)**. --- ### **Manufacturing Infrastructure & Integrated Operations** Coastal Corporation operates three state-of-the-art processing units in Andhra Pradesh, strategically located near coastal harvest areas to minimize the time between harvest and processing, ensuring maximum freshness. | Facility | Location | Key Capacities & Features | | :--- | :--- | :--- | | **Unit I** | Visakhapatnam | Plate Freezer (**17.5 MTPD**), IQF (**10 MTPD**), Cooker (**10 MTPD**) | | **Unit II** | Visakhapatnam | Plate Freezer (**14 MTPD**), IQF (**25 MTPD**), Cooker (**10 MTPD**) | | **Unit III** | Kakinada SEZ | Plate Freezer (**14 MTPD**), IQF (**32 MTPD**), Cooker (**12 MTPD**), Breading & Nobashi lines | **Operational Excellence & Quality Assurance:** * **Total Freezing Capacity:** Approved capacity of **71 Metric Tons Per Day (MTPD)**. * **Global Certifications:** Facilities are **FDA and EU certified**, adhering to **HACCP, BRC, and BAP** standards. * **Rigorous Testing:** All products undergo strict **antibiotic testing** and microbial/chemical analysis in in-house labs. * **Sustainability:** Operates a **3.6 MW Captive Solar Power Plant** at Dowleswaram to reduce carbon footprint and optimize energy costs. --- ### **Product Portfolio: From Commodity to Value-Added** The company processes a wide variety of shrimp species, including **Vannamei**, **Black Tiger**, **Sea Tiger**, **Whites**, and **Pink-Brown**. Its product strategy focuses on moving up the value chain to capture higher margins. * **Basic & Peeled Products:** Includes Headless Shell On (**HL**), Easy-Peel, Peeled Deveined Tail On (**PDTO**), and Peeled Un-Deveined (**PUD**). * **Ready to Eat (RTE):** A comprehensive range of cooked shrimp variants (Head-on, HL, PDTO, and PD). * **Specialty & Value-Added (VAP):** High-margin offerings such as **Nobashi**, **Breaded Shrimp**, **Shrimp Rings**, **Butterfly**, and **Shrimp Skewers**. * **Brand Presence:** Marketed under premium labels including **'Coastal'**, **'Coastal Premium'**, **'Coastal Gold'**, **'Jewel'**, and **'President'**. --- ### **Strategic Growth & Diversification Projects** To mitigate geographical risks and capitalize on emerging sectors, CCL is executing a dual-track expansion strategy involving a new seafood plant and a foray into biofuels. #### **1. The Ethanol Diversification (Coastal Biotech Pvt Ltd)** CCL is positioning itself to benefit from India’s **20% Ethanol Blending Target**, a market projected to reach **Rs 84,000 Crore** by **2025**. * **Capacity:** **198 KLPD** grain-based distillery in Odisha. * **Capex:** **Rs 156 Crore** (funded via **Rs 125 Crore** debt and **Rs 31 Crore** promoter contribution). * **Status:** Machinery erection is complete; trial production is scheduled for **April 2024**. * **Feedstock:** Designed for multi-feedstock use, including **maize, rice, and damaged grains**. #### **2. Odisha Shrimp Expansion (Continental Fisheries India Ltd)** * **Capacity:** **12 MTPD** greenfield processing plant. * **Capex:** **Rs 42 Crore** (funded via **Rs 22 Crore** equity and **Rs 20 Crore** debt). * **Timeline:** Groundbreaking occurred in **Feb 2024**; commissioning expected by **Q4 FY2025-26**. #### **3. Market Diversification** To reduce over-reliance on the US market, CCL has secured strategic partnerships in Asia: * **Japan:** Agreement with **Toyo Reizo Co. Ltd. (Mitsubishi Corporation)**. * **South Korea:** Agreement with **SPC GFS Co. Ltd.** --- ### **Financial Performance & Capital Structure** FY 2023 was a year of consolidation as the company navigated global inflationary pressures and a slowdown in US consumer spending. **Consolidated Financial Summary:** | Metric (INR Crore) | FY 2023 | FY 2022 | YoY Change | | :--- | :---: | :---: | :---: | | **Total Revenue** | **352.72** | **491.10** | -28.2% | | **Profit After Tax (PAT)** | **7.94** | **12.88** | -38.3% | **Capital Infusion & Funding:** * **Rights Issue:** Successfully raised capital by issuing **1,929,800 shares** at **Rs 225** per share. * **Promoter Support:** Promoters infused **Rs 19.49 Crores** in equity during FY23-24. * **Digital Investment:** Partnered with **TCS** to implement the **TCS iON ERP system** for enhanced operational transparency. --- ### **Fiscal Incentives & Policy Support** The company benefits significantly from government schemes designed to boost exports and food processing: * **Grants:** Eligible for **Rs 10 Crores** under the Central Scheme for Integrated Cold Chain. * **Interest Subvention:** **3% Interest Equalization** on export credit and central subvention for the Ethanol project. * **State Subsidies:** Power tariff reimbursement of **Rs 1.00 per unit** and GST refunds in AP and Odisha. * **Export Incentives:** Duty drawbacks of **3.0% on FOB** and **RoDTEP** at **3.1%**. --- ### **Risk Management Framework** CCL employs a proactive approach to managing the inherent risks of the aquaculture and export sectors. **1. Market & Currency Risk:** * **US Exposure:** While the US market saw a **22% value decline** in FY23, CCL is offsetting this with growth in **China (+34% YoY)** and the **EU/Japan (+17% volume growth)**. * **Forex Hedging:** Hedges **5% to 10%** of forecasted **US$** sales using forward contracts. **2. Operational & Input Risks:** * **Price Sensitivity:** A **5% increase** in raw material prices impacts profit by approximately **Rs 10.48 Crore**. * **Biological Risks:** Mitigated through scientific pond management and sourcing from diverse aquaculture zones. **3. Credit Risk Management:** The company maintains a strict credit policy with an average collection period of **under 90 days**. | Ageing | Expected Credit Loss (ECL) % | | :--- | :--- | | Within Credit Period | **0%** | | 60-90 days past due | **0.5%** | | > 90 days past due | **1.0%** | **4. Regulatory Compliance:** Management is addressing a qualified audit opinion regarding **Rs 14.24 lakhs** in commission to Independent Directors, which is currently awaiting formal shareholder approval.