A multibagger plunges 10% in a day! What really spooked Avanti Feeds?

Shares of multibagger Avanti Feeds cracked over 10 per cent on Wednesday after the company on Tuesday posted a 35 per cent year-on-year drop in net profit at Rs 47.85 crore for the quarter ended December 31.

The company had posted Rs 73.57 crore profit for the same period last year. An 18 per cent YoY rise in total expenditure mainly dragged profit growth in Q3FY20.

The figure increased to Rs 869.07 crore during the quarter under review from Rs 735.24 crore in the same period last year.

The scrip declined 10.38 per cent to Rs 599, while the benchmark BSE Sensex closed up nearly 0.90 per cent.

Total income of the company, however, increased nearly 11 per cent YoY to Rs 942.29 crore. The company operates in business across segments such as shrimp feed, shrimp processing, and power. Avanti Feeds also offers a wide range of shrimp feed.

Earlier, the shares of the company had rallied 34,177 per cent in last 10 years. The scrip jumped to Rs 668.40 on February 4, 2020 from just Rs 2 on the same day in 2010. BSE Sensex gained 151 per cent during this period.

The spike in Avanti Feeds’ share price indicated that an investment of just Rs 10,000 would have grown to over Rs 34 lakh in 10 years.