Avanti Feeds put its dismal show behind and rallied over 8 per cent on Wednesday morning as a top executive tried to calm nerves about the state of affairs in the company.
Managing Director Indra Kumar told ETNow that shrimp demand has normalised and the company has order for the next 6 months.
The scrip was trading 8.67 per cent up at Rs 1,471 at around 10 am whereas the BSE Sensex was up 94 points, or 0.28 per cent, at 34,999.70.
“We are not worried about margins and the business is doing pretty good. There is nothing to worry about the business side. Correction in shrimp prices has caused demand to go up,” Kumar said.
The company management has attributed the drop in shrimp prices to a temporary decline in consumption in the US following an extended winter. A stable shrimp production in countries like Indonesia and Vietnam has also weighed.
Shares of Avanti Feeds have been on a downhill and taken a knock of 45 per cent since April 26.
The management has guided for at least 10 per cent growth in capacity utilisation in FY19. It expects 60-65 per cent capacity utilisation in processing and export of shrimps.
“We are expecting an average of 10-12 per cent of profit margin in FY19,” Kumar told ETNow.