India’s shrimp production may increase by 10% in 2018

Indian aquaculture production is estimated to touch a record 7 lakh tonne in current fiscal and reach 1 million by 2020…


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Indian shrimp production is estimated to increase by 10% in 2018, provided the climate does not create major problems, according to a report by Globefish, a division of Food and Agriculture Organisation (FAO). The Indian shrimp exports to the US rose by 39% to touch 2,14,400 tonne by 2017 and the demand is expected to remain robust.

Indian aquaculture production is expected to touch 7 lakh tonne during current fiscal and 1 million by 2020. However, entry of new players and countries in the supply chain has led to a glut in the market with shrimp prices in free fall recently.

Why is this important?

The estimated increase in the production favours the government’s focus to achieve export target of USD 10bn by FY2022. The government in Budget 2019 has also allocated a dedicated fund of Rs. 10000 crs to develop fisheries, aquaculture and animal husbandry.

How the stock will be impacted?

The expected increase in the shrimp production is likely to benefit Indian shrimp feed and processing companies such as Avanti Feeds (CMP: Rs. 1366, MCap: Rs. 6185 crs, PE 8.2x FY20E), Waterbase (CMP: Rs. 173, MCap: Rs. 716 crs, PE 57.3x FY2017) and Apex Frozen (CMP: Rs. 475, MCap: Rs. 1485 crs, PE 47.5x FY2017).

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