Budget 2024: Shrimp stocks zoom up to 20% on FM's announcements
Shares of Shrimp companies registered early morning gains of up to 20% after the government announced financial support for shrimp farming, processing and export.
The government's initiative to promote shrimp farming is expected to boost seafood exports. Financing for shrimp farming, processing and export will be facilitated through NABARD. "Financial support for setting up a network of Nucleus Breeding Centres for Shrimp Broodstocks will be provided. Financing for shrimp farming, processing and export will be facilitated through NABARD," the FM says in her Budget 2024 speech in Parliament.
India’s seafood exports in the last financial year touched an all-time high of more than ₹60,000 crore. The FM's announcement of a reduction in basic customs duty (BCD) on certain broodstock, polychaete worms, shrimp and fish feed to 5% and exemption of customs duty on various inputs for the manufacture of shrimp and fish feed is expected to be a plus for the industry. According to the finance minister: "Frozen shrimp accounted for about two-thirds of these exports. To enhance their competitiveness, I propose to reduce BCD on certain broodstock, polychaete worms, shrimp and fish feed to 5 per cent. I also propose to exempt customs duty on various inputs for the manufacture of shrimp and fish feed."
Reacting to the development, shares of major shrimp companies like Apex Frozen, Waterbase, Avanti Feeds and Coastal Corporation are trading higher today. The latest BSE data shows the share of Apex Frozen was up 18.96% at 12.16 PM. They hit its one-year high at ₹311.75 on the BSE after seeing a gap-up opening. As the volume of trade surges to 3.28 lakh at 11.50 AM against the two-week average of 0.59 lakh, the seafood company's m-cap surged to ₹959.22 crore. Aided by the two-day consecutive rally, the share of Apex Frozen has surged 31.78% in the past week.
Similarly, another seafood company Waterbase share has seen an 18% rise today, hitting the day's high at ₹102.18 on the BSE, trading near a one-year high level of ₹105.01. Around 19.54 lakh shares are being traded on the counter at 11.55 AM today against the two-week average of 1.75 lakh, taking the company's m-cap to ₹412.32 crore.
Animal Feed, an animal feed company, saw its share touching a one-year high level of ₹729.30 today after a gap-up opening. Shares are currently trading at ₹728.15 (11.57 AM), up 12.89%, on the BSE, taking the company's m-cap to ₹730.35 crore. Seafood company Coastal Corporation Ltd shares are up 10.23% (11.59 AM) at ₹310.30 on the BSE, taking its m-cap up to ₹415.62 crore. Coastal Corporation shares have surged 13.28% in the past week. Shares of aqua feed company Godrej Agrovet Ltd are also up at ₹858 on the NSE, up 3.34% from yesterday's close.
HDFC Securities, in its analysis of the Budget, says the government’s efforts to improve productivity and reduction in basic customs duty will make Indian marine products more competitive and increase demand for frozen foods, benefiting aquaculture or seafood companies.