Avanti Feeds zooms 9.5% on June 18; stock may top Rs 700-mark; details here

Avanti Feeds share break out: After staying range-bound since the start of the year, Avant Feeds stock price broke out of the consolidation phase on June 7

Avanti Feeds share: Avanti Feeds share price hit a fresh 52-week high of Rs 652 apiece after it soared 9.5 per cent on the BSE in Tuesday's intraday trade. The spurt was supported by healthy volumes on the counter which saw 5.88 million shares being exchanged on the BSE and NSE.

At 2:00 PM, the stock was quoting 8.5 per cent higher on the BSE at Rs 646 per share as against 0.32 per cent rise in the benchmark BSE Sensex. Including today's stock price rally, Avanti Feeds share price has surged 55.3 per cent, thus far, in calendar year 2024.

Besides, over the past one year, Avanti Feeds share price has gained 53.3 per cent on the BSE. By comparison, the benchmark Sensex index has gained little over 20 per cent in one year.

According to a recent report by CRISIL, Indian shrimp exporters are expected to see revenue growth of 8-10 per cent this financial year (FY25) as demand from key importing nations could recover, improving realisations.

The revenue growth, CRISIL said, will be despite the higher duties for Indian exporters in the United States and locational advantages enjoyed by key competing nations.

“Higher revenues and lower procurement costs will help Indian shrimp exporters sustain operating margin around 7 per cent this fiscal, despite supply chain disruptions and higher logistics costs because of geopolitical uncertainties,” the rating agency noted in a report dated June 12.

The agency believes credit profiles will remain healthy as debt remains in check because of improving cash accrual, prudent working capital management, and limited capital expenditure (capex) due to surplus capacities.

Avanti Feeds Ltd is one of India’s leading Shrimp exporting companies, operating with a coherent supply chain and a farm-to-fork model using a vertically integrated infrastructure of aquaculture farms, feed mills, hatcheries and processing plants. It has five shrimp feed processing units with a production capacity of 7.75 lakh MT per annum.

"Indian shrimp exporters stand to benefit as demand improves for two reasons. First, lower channel inventories at importers’ end, who had reduced purchases in the past few months, will need to be replenished. Second, higher spending on discretionary and food items, as the economic outlook improves for Western economies (the key consumers), will drive-up volume and realisations for exporters. Volume and realisations of Indian shrimp exporters will go up in tandem by 4-5 per cent each, driving the revenue growth,” said Himank Sharma, director, CRISIL Ratings.

Avanti Feeds: Stock technical breakout

After staying range-bound since the start of the year, Avant Feeds stock price broke out of the consolidation phase on June 7. On June 18, the stock’s intraday high breached the higher end of the Bollinger Band (Rs 652.6 per share).

Besides, the price-to-moving averages action seems favourable as the stock is not only trading above the key moving averages (20/50/100/200-day moving average), but the shorter-term moving averages are also holding above their longer-term moving averages. The MACD indicator is also firmly above the zero line on the daily charts.

With this, the stock’s near term support is placed at Rs 555.5, its 20-DMA, followed by Rs 537, its 50-DMA. As per the Fibonacci charts, its next upside target is Rs 689, followed by Rs 717.