Have seen few things mentioned on various social media sites about rise in debt, receivables etc of Avanti. Nothing unusual about it. Domestic business of Avanti ( feed) is mostly cash & carry. So, we will not see much receivables. Coming to exports, there is a lag before Avanti receives payment from end customer. This particular part of receivables is financed through export finance loans from banks ( packing credit loans in banking parlance). Especially, Q2/Q3 being peak season for shrimp exports, we will see rise in working capital loans. These are typically 3-6 month/ low cost loans, generally availed by exporters, and are retired with proceeds received from customer.
Key things we need to dig around and look for answers to my mind are below ( not exhaustive and pls do add)
a) what’s the current on the ground situation w.r.t feed business. Have the farmers, who have stopped temporarily during Q2 returned to farming now?
b) what’s the situation w.r.t raw material and shrimp prices?
c) what’s the situation w.r.t exports by Avanti to Europe and other Asian countries? In the past, there have been news articles about Avanti starting exports to Japan and China? Have they started and what are the current volumes? And after the European audit early this year, what’s the outcome? Have they given selective approvals and is Avanti exporting to EU?
d) shrimp processing segment- current utilization levels and when do they expect to see higher utilization levels.
Was thinking, may be if we could do a VP member Q& A with management, like done in the past would give us more flavor? Most of the time in concall is wasted asking about next quarter targets etc. Would love to hear others.