Hi, sir. Congratulations on good numbers. Just wanted to know this quarter was good in terms of exports due to strong demand in Europe. So just wanted to gauge how the global demand is currently? And how will it be as per your industry? Secondly, there was marginal softening in commodity prices. However, as your team reported in processing, you see raw material prices the profits were down. So on that front, wanted some clarity? An d overall , some clarity on when are you going to take on fish feed business?

I think first question, Nikhilesh, can you answer that first question, please?

Okay. Hi Good evening. So, on the global demand question, sh rimp continues to be a strong seafood category. Lot of customers, consumers always think shrimp is a good seafood meat. So consumption only will increase with higher income levels. So that's positive. And being closed in, it can give also long shelf life. So like overall, global demand for shrimp is good and is forecasted to be positive in the long term. What was the second question?

It was about the raw material prices being high in processing business and hence the profits are down? Alluri Nikhilesh So, in September this year, it was very unfortunate that Andhra Pradesh suffered huge rainfall. So a lot of crops, shrimp ponds were washed away. So the off season continued instead of for 2 months for almost 3.5 months where we didn't get the second crop even till now. So we had to buy raw material at higher prices due to limited availability. So that was the reason for the high cost of input.

The third question, can you please repeat?

For the fish feed business?

Fish feed as I told you, the fish feed business, we have undertaken lot of survey. And also, we have identified about 6 farms, the fish culture farms, where we would like to run the trial feeding and seeing the results how the fish feed, which is the formula which we have now, that is Thailand, Thai Union has got that fish feed which we are going to import and use it here in our farms, and see how the results are. Because there are several varieties of fish like Sea bass and unless each product has got different parameters, like protein levels that is required, so it is a bit difficult for us to have a different type of products under the species of fish. So , what we are doing is now we are trying to undertake the trials in respect of each one of them and try out in about 5 to 6 fish culture farms. We have entered into some sort of understanding, MOU, with the owners of these farms to undertake the trial runs. And once it is proved to be effective, and if it is good, then we will make them produce in Thailand and import to start with. And gradually, we will, once the demand picks up in India, we will start our own production facility in course of time. There's a lot of work is being done because the price is another important challenging factor which the prices of Indian products keep fluctuating. And once we enter into the imported fleet, it will have a cost effective, and we will determine the demand for the product. So, we are trying to balance these two things and arrive at a competitive price for the Indian farmers so that we will be able to give them in competition with the other producers in India. So, while it gives a better ease, it should be competitiv e also. Price should be competitive. That is what our endeavor is and we are working very seriously on this. Maybe next, 3 to 6 months we should be able to start off on this.

And relating to my second question, sir, CVD and freight rates are high, and it's been 2 months since the quarter has ended. So what is the outlook now and going ahead?

The final determination of CVD has come at 5.77 %. So we'll have to see that announcement sometime next month and that will have a direct impact on that. But we are also working on various other cost effective measures and try to see that we'll still make margins out of this by increasing the value added products and all. I think, Nikhilesh, can you just throw some light on this? Alluri Nikhilesh So, CVD and ADD, they're two separate duties, countervailing duty and antidumping duty. And right now, our antidumping duty is about a little low 1%, 1 .2% something. And CVD is determined to be 5.77% where the final determinations are being made right now. So maybe we expect or we anticipate that the CVD might reduce by maybe 4.4%, but not sure. But on the alternate route, all the other countries like Ecuador, Vietnam, Indonesia, everyone attracted CVD or ADD. Unfortunately, India stands with the highest duty of 5.77% compared to the other countries. In the long run, in the p ast, we've had CVD duty for Shrimp before, but it's a lot of working with the government, the U.S. Regulatory authority, and also the private sector to submit and rework on some of these claims that the USDOC is making. And so this is a time taking process. But if you work it right, then the duties will come down. It's not any tariff per se, which was not revised previously. So it is a complicated case. It is a small problem for India at the moment and also the other countries have CVD, so everyone has this problem. But on the long run, I think we can work with the government to reduce such duty. And second, also, this also means higher selling price in the market. So that would be helping to drive revenues up, because the selling price of shrimp has been falling continuously for the last 2, 3 years. So that's about the CVD and ADD.

It's very important, it all depends on the government there U.S. and also it is an ongoing process. It is almost done. The CVD, once 1 year, the 2nd year, again, it will be reviewed. And again, the data is collected whether what are the incentives that the government is giving, and what are the taxes that is being levied, and all that it will work out, and as Nikhilesh said, it may come down also in the next year. But it is an issue which we have to live with it. Because, the CVD has been levied by U.S. on almost all the countries. It is only our effort should be to reduce the CVD percentage on versus levied on Indian exports.

Ladies and gentleman, if you have any questions, please press * and 1 on your telephone keypad. And you're requested to ask 1 question in the initial round and you may join back the queue for more questions. Our next question comes from Pradeep Rawat from Yogya Capital. Please go ahead.

Good Evening and thank you for the opportunity. So, I have just one question about Ecuador. So how is the competition pairing up with respect to Ecuador, especially after the power shortage issue over there?

Nikhilesh, can you take this one?

So, Ecuador, we've told in previous meetings that Ecuador and India, we have separate product categories. India does more of field and cook shrimp than Ecuador does head on well commodity products. On the power shortage, at the current moment, this has affected Ecuador's exports. They're not able to produce it much. So, the selling price in China has been moving up due to non-delivery from the Ecuadorian market from what we gather in market Intelligence. And also , in the U.S, there's also less exports of Ecuadorian shrimp in the past 1, 2 months. However, we need to see how this pans out in the long term. Currently, we are most of the buying for the primary market is done for the holiday season. So right now, there's no large impact for any other producing country like India, Vietnam or Indonesia because of the power problems in Ecuador.

Okay, understood. And one last question, if I can squeeze in. Can you also mention the CVD on other countries like Ecuador and Vietnam?

Maybe if you could send an email, we can send it in the separate note.

Thank you, sir. Our next question comes from Nitin Awasthi from InCred Equities. Please go ahead.

Hello sir, one question continuing from the previous participants’ questions is that the amount of CVD that we have paid so far, I believe we are liable to pay CVD from April this year. And, for how far have we paid the CVD? And whenever we have paid it, have we booked it as an expense or as a different item?

Satyanarayana, the CFO, will answer the question.

Yeah. So far, the company has paid around INR 8.5 crores CVD till 30th September 2024. And whatever the CVD we deposit with the U.S. Government, we are booking as an expenditure. We are debiting to P&L.

Understood, sir. So as of now when the rate increase is coming, we're still continuing and depositing what we are depositing earlier or are we depositing as per a new rate?

No. We are depositing as per the existing rate, the rate which was decided during preliminary determination, which is 4.36%.

Understood, sir. So, second question from my side would be, are we looking to use BTGS as a component in our fleet given that there has been a lot of production of that commodity in the country now due to a different reason within the ethanol program? But however, there is a lot of animal feed company experimenting with this product. Are we also doing the same?

No, listen, we're not using it in our shrimp field. Hello?

Yes, sir.

We're not using BTGS in our shrimp field as a plug because it has some nutritional factors, which are not very good for growth promotion.

Understood. However, are we experimenting with it, trying to make it efficient? Or that is not out on the system?

That is fact but we didn't get favorable results.

Thank you, sir. Our next question comes from Kamal Sharma, an Individual Investor. Please go ahead.

Thank you. So, my question relates to two recent announcements coming from government. So one is, of course, what you mentioned in the presentation about the budget, wherein there were, I think, three separate incentives where shrimp or aquaculture was referred to? And then a recent one, wherein there is a MSP hike on soya bean plus of course in your presentation, you have mentioned about hike in the EBITDA rate as well. So how do you see these two together? So first one is, what is the opportunity size and the project fee announcement open up for? And how long will this time be arranged? And is it like, we if the government is planning to achieve those targets in 1 year, 2 years whatever or do we have that clarity yet? And of course do we have the capacity to support that opportunity utilization? Combined with the impact of soya bean price MSP announcement, so how will these two go together?

See, the MSP announcement has been ther e with from the government from time to time. And mostly it is related to some political activity rather than the real situation of the crop prevailing in the country. That has been the stand that has been the procedure that's been followed by the government. Whenever they consider that the farmers are not getting remunerated for their crop, they increase the MSP. That is the MSP is the price at which the government procures the soya from the farmers. But there are other factors which are working in the market, it keeps on changing. For instance, recently soya price has been increased. So, MSP has been increased. But there we did not feel that much impact on the soya price as such - it is remaining more or less stable on 5% this side or that side, it is fluctuating on a day- to-day basis. So, MSP is something which is the government regulation which says that if you buy from the farmer, you have to buy only from that, and for MSP, it's a price which, the farmer has to sell. That is the remunerative price. So that, in fact, we'll not have a direct impact immediately, but over a period of time, when the government start purchasing more, then it will have an impact. Then there will be demand for that. The prices will be more than the MSP. But as of now, it is not the situation as far as the soya is concerned. Coming to the other question which you mentioned?

The opportunity standard is coming due to the budgetary announcements?

Yes. The budgetary announcement is about the, the other things that are about the, as far as the aquaculture industry is concerned, they are for processing and export. We have already explained the details of the schemes that are in operation now. And other than that, they are trying to encourage a nucleus breeding centers for the brood stock. That is one of the major constraints that India has been facing, because India does not have a proper brood stock available for the culture. We have been importing from different countries, and each time the quality of the brood stock varies, and sometimes it will have less survival, sometimes it will have quick disease, prone to diseases and all. So the Government of India would like to now encourage the Indian farmers or processing units, the stakeholders, to start nucleus breeding centers for these brood stock. But, with the support of NABARD. But so far, no instructions or no scheme has been announced by NABARD. I think we'll have to wait for some more time if they come out with the, for on this proposal. Other than that, as we have explained, they are encouraging the employment. So they are increasing the apprenticeship programs and also internships. As far as the aquaculture industry is concerned, we are taking number of apprentices in each of the shrimp culture activity. For example, in feed manufacturer and culture itself, shrimp culture and processing, we are training them. So that is an advantage which overall if it is possible for Indian shrimp culture to make more economic and more competitive prices global ly - it will have a very good future as the consumption of shrimp is increasing globally. These are the impacts of budget. But government seems to be very serious about this. They are taking aquaculture, marine food products export as one of the major tru st areas for the government for adding foreign exchange and as well as also employment generation. Okay, I think I've answered your query.

Yes, to a large extent, but I just wanted to know if you have any numbers also available, in order? C. Ramachandra Rao For what sir? No numbers as of now. See, government schemes, it'll take time. See, there are several schemes which were announced in last budget, they were not implemented at all. So it will take some time. See, when they really got it o nly with, after a lot of pressure, they commenced these 2 programs mainly which is substantially helping the industry that is the PLI, and also Operation Green Scheme. These 2 are good. But again, there are some constraints in that also. The government is always, you know, in the situation they announce, but when the time comes for implementation, there are lot of bottlenecks for that. So they try to take these bottlenecks. We are trying to solve one after the other. So in course of time, we should be able to get these benefits. But to give numbers, as of now, nobody has got numbers as to what is the projected advantage of this.

Thank you, sir. Our next question comes from Suresh Pal from KRST Capital Limited. Please go ahead.

Thank you for the opportunity. So, my question is, we can see that the global shrimp prices are rising from quarter to start. I can see that from July end, this month of October, shrimp prices have risen more than 10%. I would like to know how Avanti Feeds will likely be benefited from thi s shrimp price rise that is happening in last 3, 4 months?

Nikhilesh?

Right now, there is, I think, the shrimp price increase , I don't think there's any such benefit for the industry because this price increase is mainly due to new duty levies. So there's no impact as such except the revenues are forced to go higher. So that's only, I guess, direct impact on to the company in the immediate term.

No, but duty might have risen 5%, 6%, right? But the price rise is more than 10%. Like if I consider 3, 4 months, it is more than 10%?

Are you talking about the selling price?

Yes, selling price I'm talking about.

I don't know if it's increased by 10%. There are some sizes which have actually increased by 8%. There's 1 or 2 sizes, but on average about 3% to 4%, 5%, maybe, but that's only because the raw material price is higher. So it's not at the market accepting higher price at the retail store at the foodservi ce store. It's more with the duty and higher raw material price at the moment.

Thank you, sir. Our next question comes from Amit Kumar Rajput from Capital Craft Research. Please go ahead.

Thanks for the opportunity sir. So, my first question regarding the American election and the recent policy shift you are looking for. As of now, our majority of business is coming from America, so any content sort of policy safety you are preparing for it as of on a tariff side? Alluri Nikhilesh So, on the U.S., I think with Donald Trump coming, at least my personal opinion is that it's more positive for India because the last term, he was there, there's nothing substantial against India or Indian people. So, but, again, we don't know. S o as a company that's diversifying our sales channels to other countries like Europe, Asia, and also Canada, Middle East, so trying to get more sales portfolio into these markets so that we kind of diversify the market rate.

Great to know. So, my second question regarding the margin side there. So could we see the recent trend in margin going forward in future? In recent your margin has been raise on a yearly basis?

Yes. See the margins are raising as it is obvious because of the margin softening of the raw material prices. So as long as these raw material prices remain at this level, we certainly make a profit, but unfortunately it's not in our control. So, we expect, the fish meal, which last year, it gave lot of tr ouble to us, because it was going up because of the exports. But this time, the Chile and Peru were the major suppliers of fish meal to the world. They have globally. They have their good crops. They are able to supply. So the demand from India has drastically reduced. So the fish meal producers in India have now look for Indian market rather than depending on the export market for a higher yield. That is number 1. Number 2, coming to the other two products like the soya bean meal and wheat flour. See, the soya bean meal the production has been continuously good. See, each year, year-after-year, this year also, the crop has done very well, and, the harvesting has already started and we expect the prices to still stop soften. But we do not know, how they are going to move, but it all again depends upon the soya oil. Soya oil is another factor which determines the price of soya bean meal. So these 2 are the balancing factors for the soya bean meal. So we expect that, the prices remain at this level for some more time. If not going down, at least it will not go up. It's what our expectation is. So that being the case, as far as the soya bean meal is concerned, we are very comfortable as of now. Coming to the wheat flour, it is surprising that the wheat flour prices are going up, like, you know, at a great speed going up. Nobody is able to exactly tell why it is going up. See, it is an essential commodity as far as the human consumption of wheat flour is concerned. So the rate at which it is going, it is imp ossible to even predict why it is growing. Crop is good. We are getting till March; we don't have crop. The next crop comes only in March. Still 4 months are left, 4, 5 months. But how it's going to be in these 4 months? It is expected that after Maharashtra elections, the prices are going to little soften. We have to wait and see how this, particularly wheat flour, which no one is able to really imagine, but being the highly consumed product in a daily, families, the wheat flour is going up like anything which is surprising. So, we will wait and see. We are expecting that after Maharashtra elections by end of this year, their prices should come down. So if these prices remain, definitely we'll be able to achieve the margins what we have achieved now and we'll be able to maintain these margins definitely.

Okay. Fair enough. So, sir, my last question would be, if you can give me any sort of guidance regarding FY25 financial year on the margin side?

See, what happened was in the, earlier this quarter, there was, as Nikhilesh said, there was unexpected rainfall, it was cyclone and all, has reduced the crop. Actually, the duration of the crop, the main crop reduced. And they were forced to harvest, the 10 counts, sorry, 10 grams. There were 100 counts. So that's why the feed consumption has come down, the margins automatically will come down. But the best point of that is that later on in August September, the climate has really improved and it was very congenial for the shrimp culture. So, the farmers have stocked it again and it's going well as of now . If nothing serious happens in next 1.5 months, 2 months, we should be able to, get the normal crop and also then the consumption will also be there. We are expecting more or less whatever the last year's consumption plus or minus 5%, we should be able to achieve 5,40,000 MTs or something like that was the last year’s feed sales. And we are also likely to register more or less the same sales this year. And as I told you, because of the raw material softening, we may be able to get better margins compared to the last year. That's what our expectations are, positive expectations. And we'll have to wait and see for another one and a half months. So that will result in automatically in the next FY25 ending on 31 st March, which will be reflected. Again, if the situation continues, again, the next crop will start sometime in the January end and February beginning. Then again, there will be sales. I think it looks as of now very promising. Let's just wait and see because it's a very volatile market.

Our next question comes from Sriram R, an Individual Investor. Please go ahead.

I have 2 questions. One is on the shrimp processing. Do you import the raw shrimp or do you have a shrimp farm? Second question is sorry sir, go ahead.

You may continue with your second question.

Yes. My second question is the budget had some provisions regarding decrease of custom duties for shrimp fee. So how has that impacted you? Are we seeing more imports now because of the duty cut?

Yes. First, I think, Nikhilesh, can you answer the first question?

We don't import any shrimp. India is one of the largest producer of shrimps. So, we buy shrimp locally. So as Avanti, we don't farm ourselves. We have like some contract farming, that's a major source of shrimp.

So as far as the reduction in the customs duty of some of the products relating to the shrimp culture, it's true that there is a reduction, but it did not really have any impact on us and rather it has a negative impact. As far as the proteins, protein premixes and mineral premixes, we were importing earlier, but now everyth ing is available in India. Almost every product is available in India. And, what they have done is they have decreased duty on shrimp feed, imported shrimp feed , which is a negative point as far as our industry is concerned, the Indian shrimp feed industry is concerned. Because if reduced the price of imported then foreign companies are likely to dump their products in India. So that, in fact, we have represented, to the government that please bring back the same level because if you reduce the shrimp fee duty, then the neighboring countries, they'll have the advantage of the reduced import duty, so they will dump in India. But we are, so far, there has not been so much impact on account of this. But certain advantages are there. The farmers do know that the Indian shrimp feed is more fresh and they are able to get better yields and all those things. So they may not immediately go unless it is really very attractive for them to go and it gives the expected results, the feed. So that is the one disadvantage which we found. But as far as the other products are concerned, we are having all the products available in India. Only argan oil was reduced, but that is again a substitute for fish oil. But that is very expensive. And India has got plenty of fish oil available. So along with fish meal, we are buying locally the fish oil also, sourcing it. So there is no need for practically any import of raw materials. So there is no impact of reduced duty on our feed cost.

Sir, just one question. I mean, what is the pricing difference between the imported shrimp feed and our feed?

It is same. There is no difference at all. See, if you, in fact, look at the yields and performance of the Indian feed, it is much more. I think, Mr. Venkata Sanjeev will be able to give more details on this.

So as of now, the prices are almost similar to Indian feed prices. The performance of the imported feed is not as good as the Indian feed, like Mr. Rao said, and also the new Indian feed companies which have taken over the market share, so it's become very hard for the foreign players to enter and get a substantial market share.

See, the already most of the foreign companies are already in India. They have their plants. For example, CP, they are already, -there are so many foreign companies which are there in India. And there is no need for them to bring, import the feed. That's what we have represented to the government. See, they already, the foreign companies a re there in this, feed manufactured in India and they are getting the feed. Then why should they, why should the Government of India allow reduction in custom duty on the import of these products? So, we hope that by next budget we will be able to get some favorable outcome of our representation.

Okay, sir. Got it. Thanks for an elaborate answer, sir. Very helpful. Thank you. All the best.

Thank you, sir. Due to time constraints, that will be the last question. Now I hand over the floor to the management for closing comments.

Yes. Right.

Thank you, investors. Thank you everyone for participating in this call. So in case of any queries, you can reach out to us by mail. Thank you.

Thank you so much. Ladies and gentlemen, this concludes your conference call for today. Thank you for your participation and for using Door Sabha's conference call service. You may all disconnect your lines now. Thank you, and have a good day.

1. This document has been edited to improve readability 2. Blanks in this transcript represent inaudible or incomprehensible words.