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    SKM Egg Products Export (India) Q1 FY27 earnings call

    SKMEGGPROD
    Fast Moving Consumer Goods·31 Jul 2026
    Management Summary

    SKM Egg Products reported an increase in dried egg powder realization to ₹770/ton in Q1 FY27. The company is strategically expanding into the domestic branded egg market, targeting ₹40-50 crores in FY27 turnover, and investing ₹400 crores in egg production capacity, including Easy Sheds expected to reduce costs by 5%. However, profitability is under pressure from rising feed costs, expected to last 3-6 months, and sales volume growth is constrained by full capacity utilization, necessitating new expansion plans.

    Highlights

    5

    • Increased realization for dried egg powder to ₹770/ton in Q1 FY27, up from ₹722/ton last quarter.

    • Branded products segment projected to add ₹40-50 crores in turnover for FY27, with margin growth from next FY.

    • Easy Sheds capex expected to reduce overall production costs by a minimum of 5%, with completion by Nov-Dec 2026.

    • Russia exports maintained at 150 tons/month, unaffected by geopolitical events, with plans for a new distributor.

    • Expansion plan for egg powder capacity expected to be approved by October to address capacity constraints.

    Concerns

    4

    • Significant increase in feed costs (soya) impacting profitability, expected to persist for 3-6 months.

    • Sales volume growth constrained in current quarters due to full capacity utilization.

    • Q1 FY27 export disruption due to 6-7 containers failing to reach destination, requiring recall and re-deployment.

    • Delay in Japan office approval by 1-2 months, pushing direct business expansion.

    Key financials

    Single quarter

    01 metrics
    1. 01Dried Egg Powder Realization770 Rs/ton

    Capital allocation

    1
    high confidence
    CategoryHeadline
    Capex

    ₹400 crores

    Guidance & targets

    10
    CategoryTargetPriority
    Branded Products
    Market Entry Plan
    Definite plan ready
    		High
    Branded Products
    Locations in India
    5 locations
    		High
    Branded Products
    Turnover Addition
    ₹40-50 crores
    		High
    Branded Products
    Margin Development Growth
    Growth
    		High
    Capacity Expansion
    Egg Powder Capacity Expansion Approval
    Board approval
    		High
    Capacity Expansion
    Easy Sheds Completion
    Complete
    		High
    Cost Efficiency
    Production Cost Reduction from Easy Sheds
    Minimum 5%
    		High
    Input Costs
    Increased Feed Cost Duration
    3-6 months
    		High
    International Expansion
    Japan Office Approval
    Approval
    		Medium
    International Expansion
    Russia Distributor Addition
    One more distributor
    		High

    What to watch in Q2 FY27

    5

    Branded Business Plan Finalization

    by end of FY27
    CurrentEvaluating, engaged consultants
    TargetDefinite plan ready

    Why it matters

    Crucial for the company's new domestic revenue stream and market diversification strategy.

    I think by end of this financial year we will have a definite plan to go into the market.

    Risks & concerns

    4
    RiskSeverity

    Increased Feed Costs (Soya)

    Substantial increase in soya costs impacting the bottom line, expected to persist for 3-6 months. — Management acknowledged

    high

    Capacity Constraints

    Full capacity utilization limits sales volume growth for the remaining quarters of FY27. — Management acknowledged

    medium

    Export Disruption

    6-7 containers failed to reach destination in Q1 FY27, requiring recall and re-deployment in July-August sales. — Management acknowledged

    medium

    Japan Office Approval Delay

    Approval for Japan office postponed by 1-2 months, but direct contracts are in place until September. — Management acknowledged

    low

    Q&A highlights

    8

    “The biggest influencing supply countries are in the international market because you are right, US is one of them. Europe is one major Now India is also a player and South American countries; Ukraine and China these are the major supply countries which make an impact on the international price.”

    Clarifies the complex market dynamics and competitive landscape for the company's core product, highlighting key global players.

    asked by Mr. Pramukh Kabra

    2 min read6 chapters

    Detailed Narrative

    01

    Q1 FY27 Performance and Realization

    For the first quarter of FY27, SKM Egg Products reported an increased realization for dried egg powder, reaching ₹770 per ton, up from ₹722 per ton in the previous quarter. The company faced operational challenges, including a disruption where 6-7 export containers failed to reach their destination, necessitating their return. These products are currently being retested and are slated for deployment in July-August sales, impacting Q1 capacity utilization and export volumes.

    02

    Strategic Entry into Domestic Branded Market

    SKM Egg Products is actively pursuing a strategic shift towards the domestic branded egg market, with a comprehensive plan expected to be finalized by the end of the current financial year. The company is designing a business model to operate in five locations across India and anticipates this new segment to contribute an additional ₹40-50 crores in turnover for FY27. Margin development growth from this initiative is projected to commence from the next financial year.

    03

    Capital Expenditure for Capacity and Efficiency

    The company has allocated ₹400 crores towards enhancing its own egg production capacity, which will serve as a crucial supply base. This capital expenditure is planned in a phased manner, with initial investments in FY28 and FY29. A key component of this investment is the 'Easy Sheds' project, which is expected to reduce overall production costs by a minimum of 5% through improved productivity and feed conservation. Four Easy Sheds have already been completed, with the remaining scheduled for completion by November-December 2026.

    04

    Input Cost Pressures and Limited Pricing Power

    A significant challenge impacting profitability is the substantial increase in feed costs, particularly soya. Management anticipates these elevated input costs to persist for another three to six months, directly affecting the company's bottom line. In the international B2B market, the company faces limited pricing power, as pricing is primarily dictated by global competition and market rates rather than its internal cost structure, making it vulnerable to commodity price fluctuations.

    05

    International Market Updates and Expansion

    SKM Egg Products provided updates on its international market initiatives. Approval for its Japan office has been delayed by one to two months from the initial June-July target, though direct contracts are in place until September. Exports to Russia continue robustly at approximately 150 tons per month, with the Russia-Ukraine conflict not currently impacting operations. The company plans to induct an additional distributor in Russia during the second half of FY27, with the Chairman scheduled to visit in October-November to support this expansion.

    06

    Capacity Constraints and Future Expansion Plans

    The company is currently operating at near full capacity, which is restricting its ability to increase sales volumes in the upcoming quarters. To address this, an expansion plan for its egg powder capacity (referred to as 'Egg Powder Crossing' and potentially 'vaccine capacity' in the transcript, likely a transcription error for egg-related capacity) is being prepared. This plan is expected to be presented for board approval, with finalization targeted by October, paving the way for future growth.

    This is an AI-generated summary of a publicly available earnings call transcript.