Avanti Feeds Limited — Q3 FY26 earnings call

Call held 3 Mar 2026

Management summary

Avanti Feeds reported a mixed Q3 FY26, with consolidated gross income declining QoQ but showing YoY growth. The nine-month performance was strong, driven by significant PBT growth across consolidated and shrimp processing segments. The feed division saw QoQ declines in revenue and volume, impacted by seasonal factors and rising raw material costs, which are expected to compress Q4 margins. The Pet Care segment continued its growth trajectory, while the company navigates trade tariff uncertainties and plans for its pet food manufacturing facility.

Highlights

  • Consolidated PBT for 9M FY26 increased by 32.7% to INR 698 crores, compared to INR 526 crores in 9M FY25.

  • Shrimp Processing & Export division's gross income for Q3 FY26 increased 39% YoY to INR 455 crores.

  • Shrimp Processing & Export division's PBT for Q3 FY26 increased 188.88% YoY to INR 52 crores.

  • Pet Care project recorded sales of INR 136.2 lakhs in Q3 FY26, a 43.24% QoQ growth.

  • Feed division's 9M FY26 PBT margin stood at 16% on revenues, up from 13.3% in 9M FY25.

Concerns

  • Consolidated gross income decreased 12.78% QoQ to INR 1,447 crores in Q3 FY26.

  • Feed division's gross income decreased 17.25% QoQ to INR 993 crores and sales volume declined 23.61% QoQ to 1,18,127 MT.

  • Steep increase in raw material prices (fish meal, soya bean meal) is expected to impact Q4 FY26 margins, with FY26 PBT expected to be 14.5-15%.

  • Uncertainty regarding the US import surcharge, with potential increase to 15%.

Key financials

  1. Consolidated Gross Income ₹1,447 Cr +3%YoY
  2. Consolidated PBT ₹222 Cr +20.6%YoY
  3. Consolidated 9M Gross Income ₹4,761 Cr +9.7%YoY
  4. Consolidated 9M PBT ₹698 Cr +32.7%YoY

What they filed

Q1 FY27: revenue up 26.7%, net profit down 49.7% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue1,079 1,042 1,032 1,235 1,156 +7%945 −9%1,039 +1%1,565 +27%
EBITDA113 142 166 188 145 +28%134 −6%129 −22%71 −62%
Net profit106 127 144 167 135 +27%129 +2%107 −26%84 −50%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

SegmentGross Income9M Gross Income9M PBT
Shrimp Feed Division₹993 Cr₹3,471 Cr₹576 Cr
Shrimp Processing & Export Division₹455 Cr₹1,296 Cr₹130 Cr
Pet Care Project———

Capital allocation

medium confidence
  • Capex Capex disclosed
    • Land development for state-of-art pet food manufacturing facility
    On the project side, as informed earlier, the company has purchased the land near Hyderabad, converted from agriculture to non-agriculture rules. For setting up a state of art manufacturing facility, the land development works are in progress, and we are in the final stage of finalising the design and drawing.

Guidance & targets

Profitability

  • Feed Division PBT Margin Profitability · FY26 · Medium confidence 14.5% to 15%
    Considering the continued steep increase in prices of major raw material like fish meal and soya bean meal during the past three months, which will have an impact on Q4 FY26, the PBT for the FY26 is expected to be around 14.5% to 15%.

    — Santhi Latha

Volume

  • Feed Sales Volume Volume · FY26 · High confidence 5,55,000 MT
    It is estimated that the feed sales during FY26 would be around 5,55,000 MT.

    — Santhi Latha

  • Shrimp Exports Volume Volume · FY26 · High confidence 16,500 MT
    It is estimated that the exports during FY26 would be around 16,500 MT.

    — Santhi Latha

  • Feed Volume Growth Volume · next year · Medium confidence minimum 10%
    So, it's very difficult to estimate exactly, but we, with all the present circumstances, expect that there should be a minimum 10% growth in the feed volume consumption, if not more, because this area's culture is going up and farmers are also very positive about the culture season ahead.

    — C. Ramachandra Rao

Capacity

  • Shrimp Processing Capacity Capacity · Ongoing · High confidence 28,000 MT
    Yes. 28,000 would be the right understanding.

    — A. Nikhilesh

What to watch in Q4 FY26

Pet Food Manufacturing Facility Capex Estimate

next 1-2 quarters
Current Land purchased, development in progress, design/drawing being finalized.
Target Clear estimate of total project cost and profitability.

Why it matters

This will provide clarity on the investment required and potential returns for the new pet food business.

And the total estimated cost of the project and profitability, etc., would be able to give you maybe in the next one or two quarters results.

Risks & concerns

  • Raw Material Price Volatility

    high

    Steep increase in fish meal and soya bean meal prices is expected to impact Q4 FY26 profitability, leading to a revised FY26 PBT margin guidance of 14.5-15%.

    Management acknowledged

  • US Import Surcharge Uncertainty

    medium

    The US government levied a 10% import surcharge, with uncertainty whether it will increase to 15%, impacting shrimp exports.

    Management acknowledged

  • Competition for Fishmeal (Domestic vs. Export)

    medium

    Rising Indian fish meal prices due to export demand and government incentives create a challenge for domestic availability, with the company pursuing regulatory mechanisms.

    Management acknowledged

  • Shipping Disruptions from Geopolitical Events

    low

    The Middle East situation could cause some disruption, though no immediate direct effect is observed on current markets.

    Management acknowledged

Q&A highlights

5 direct
Impact of UK/EU Trade Deals on Shrimp Market Direct
Yes. I would definitely say that the market access into EU and UK would be better. There'd be higher demand coming from these markets. Yes, 100%, because they are reducing duty.

Analyst inquired about the potential market expansion for shrimp exports to UK/EU due to reduced tariffs, which management confirmed as a positive for demand and market access.

Asked by Nitin Awasthi

El Nino Impact and Fish Meal Prices Partial
But again, the prices have gone up. Again, the demand has gone up from the particularly East, West Asia, because particularly from Taiwan and other countries, they would like to have a cheaper fish meal available from India. As far as the quality is concerned, it is the same. That is how the prices of Indian fish meal is going up.

Analyst questioned the impact of El Nino on fish meal, a key raw material. Management explained rising prices due to export demand and government incentives, highlighting a challenge for domestic availability.

Asked by Nitin Awasthi

Shipping Rates and Middle East Situation Partial
Currently, this war is quite new. So, right now, we don't have any changes. Our shipping currently is below, like the Cape of Good Hope, Africa. So, we don't expect so much, but of course, there should be some disruption. We need to see what happens.

Analyst asked about the stability of shipping rates given geopolitical tensions, to which management indicated no immediate direct impact but acknowledged potential future disruptions.

Asked by Nitin Awasthi

Feed Business Growth Outlook for FY27/FY28 Direct
So, it's very difficult to estimate exactly, but we, with all the present circumstances, expect that there should be a minimum 10% growth in the feed volume consumption, if not more, because this area's culture is going up and farmers are also very positive about the culture season ahead.

Analyst sought clarity on future growth rates for the core feed business, and management provided a directional target of at least 10% volume growth for the upcoming year based on positive farmer sentiment.

Asked by Ronak Shah

Feed Division Gross Margin Trends Direct
So, what has happened here is that the averaging of the raw material cost has really given that additional advantage in the Q3. So, what is happening is that when the prices keep going up, we follow the weighted average consumption. So, earlier low prices will have some impact on the Q3 raw material prices also.

Analyst questioned the QoQ improvement in gross margin despite rising raw material prices, and management explained it was due to the benefit of consuming lower-cost inventory from previous periods.

Asked by Ronak Shah

Pet Food Market Penetration Strategy Direct
So, right now we are concentrating mostly on the product itself. The product has gotten great response from the market, and all the dog owners and the cat owners who have used it are becoming our lead customers. So, the product is going to be the key to it. And also, we're going to soon launch new products, which will compete with the bigger brands, with better quality.

Analyst asked about the strategy to penetrate the competitive pet food market, and management highlighted focus on product quality, new launches, and expanding distribution channels.

Asked by Akhilesh Rawat

Pet Food Margins and Capex for Manufacturing Facility Partial
See, the margins, I think it is too premature to talk about the margins at this stage, because we have just started. And you know, the initial years we'll have to incur lot of expenditure on the promotion of the product and building the brand image.

Analyst inquired about pet food margins and capex plans. Management stated it's too early for margin guidance due to initial brand-building costs and that capex estimates for the manufacturing facility would be available in 1-2 quarters.

Asked by Akhilesh Rawat

Amazon's Own Pet Food Brand as a Threat Direct
Yes. We do see it as a threat that a distributor can start his own page, but he won't be able to give the same discounts as the company is able to give, and I think that's going to affect their business more than us.

Analyst raised a concern about Amazon launching its own pet food brand, and management acknowledged it as a threat but expressed confidence in their ability to offer better pricing.

Asked by Nitin Awasthi

3 min read 6 chapters

Detailed narrative

Q3 FY26 Consolidated and Nine-Month Performance

Avanti Feeds reported a consolidated gross income of INR 1,447 crores for Q3 FY26, a 12.78% decrease QoQ but a 2.99% increase YoY. Consolidated PBT stood at INR 222 crores, a 2.2% QoQ decrease but a 20.65% YoY increase. For the nine months ended December 31, 2025, consolidated gross income reached INR 4,761 crores, up 9.67% YoY, with PBT increasing significantly by 32.7% to INR 698 crores compared to the previous year.

Shrimp Feed Division: Seasonal Impact and Raw Material Headwinds

The Shrimp Feed division's gross income for Q3 FY26 was INR 993 crores, a 17.25% QoQ decrease, primarily due to a 23.61% QoQ decline in sales volume to 1,18,127 MT, as Q2 is the main season. PBT for the division was INR 172 crores, down 4.44% QoQ. Raw material prices, particularly fish meal (up to INR 117/kg in Q3 from INR 98/kg in Q2) and soya bean meal (up to INR 44/kg from INR 43/kg), saw steep increases. This is expected to compress the full-year FY26 PBT margin for the feed division to 14.5-15% from the 16% achieved in the first nine months.

Shrimp Processing & Export Division: Strong Growth Despite Challenges

The Shrimp Processing & Export division demonstrated robust growth, with Q3 FY26 gross income increasing 39% YoY to INR 455 crores, despite a 1.5% QoQ decrease. PBT for the quarter surged by 188.88% YoY to INR 52 crores. For the nine-month period, gross income grew 51.57% to INR 1,296 crores, and PBT increased 91.17% to INR 130 crores. This growth was attributed to higher sales volumes (28% increase in quantity), improved average selling price realization, and favorable foreign exchange rates. The division's processing capacity stands at 28,000 MT.

Pet Care Project: Early Traction and Future Plans

The Avanti Pet Care brand, 'Avant Furst', recorded sales of INR 136.2 lakhs in Q3 FY26, a 43.24% QoQ increase from INR 95.08 lakhs in Q2 FY26. Dog food accounts for 60-65% of sales. The company is focusing on product quality, expanding its portfolio with additional flavors, and strengthening its presence in Tier-1, Tier-2, and Tier-3 cities, including e-commerce platforms like Supertails and Amazon. A state-of-the-art manufacturing facility is planned, with land purchased and development underway; capex estimates are expected in the next 1-2 quarters, with own production anticipated in 14-15 months.

Trade Policy and Tariff Landscape

The US Supreme Court's ruling invalidated IEEPA-based tariffs, leading to the cessation of collection of unlawful tariffs from February 24, 2026. However, the US Administration introduced a new temporary global import surcharge of 10%, potentially rising to 15%, which effectively replaces the IEEPA tariffs. On a positive note, the customs duty on imported shrimp feed has been reinstated at 15% (from 5%), which is expected to help domestic feed manufacturers compete. The company is also monitoring the implementation of UK and EU trade deals, which are expected to improve market access in 6-9 months.

Outlook and Growth Drivers

Management anticipates a minimum of 10% growth in feed volume for the upcoming year, driven by positive farmer sentiment and increased aquaculture activity. The company aims for FY26 feed sales of around 5,55,000 MT and shrimp exports of approximately 16,500 MT. While raw material price volatility remains a concern, the company is actively working on expanding into new global markets, including the Middle East, to diversify its export base and leverage improved trade environments.

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