Apex Frozen Foods Limited (NSE: APEX) Q4 2025 Earnings Call dated Jun. 03, 2025
Corporate Participants:
Unidentified Speaker
Karuturi Chowdary — Managing Director and Chief Financial Officer
Analysts:
Unidentified Participant
Hrithik Hattiangadi — Analyst
Raman Kerti — Analyst
Saad — Analyst
Purushottam — Analyst
Amet Khicha — Analyst
Siddharth Agarwal — Analyst
Tom James — Analyst
Saurabh Sharma — Analyst
Mayank Patel — Analyst
Sriram — Analyst
Presentation:
operator
Ladies and Gentlemen, good day and welcome to the apex Frozen Foods Limited Q&FY25 earnings conference call. As a reminder, all participant line will be in listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touch tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Hrithik Hatian Gaddy from Stellar ir. Thank you and over to you Sir.
Hrithik Hattiangadi — Analyst
Good morning everyone and thank you for joining us today. We have with us the senior management team of apex Frozen Foods Limited Mr. Chaudhary Karuturi, Managing Director and Chief Financial Officer and Mr. Durga Prasad, Senior Manager Accounts who will represent Apex Frozen Foods Limited. On the call the management will be sharing the key operating and financial highlights for the quarter and Full year ended 31st March 2025 followed by a question and answer session. Please note this call may contain some of the forward looking statements which are completely based upon the Company’s beliefs, opinions and expectations.
As of today. These statements are not a guarantee of the Company’s future performance and involve unforeseen risks and uncertainties. The Company also undertakes no obligation to update any forward looking statements to reflect development that occurs after a statement is made. I now hand over the conference to Mr. Chaudhary Karitori. Thank you. And over to you Sir.
operator
You can please proceed.
Karuturi Chowdary — Managing Director and Chief Financial Officer
Sorry Good morning everyone and thank you for joining us on this Investor call for Q4 and FY25. We have uploaded the investor presentation on the website of the stock exchanges and we do hope that you had a chance to go through it. Some of the key trends that we probably discussed on the last quarter’s conference call have largely played out in Q4 FY25 that is like the inventory liquidation in overseas markets leading up to an uptick in the overall demand mainly in the usa. Consequently, the global shrimp prices remain firm. However, while favorable global pricing scenario typically encourages Indian shrimp farmers to increase cultivation, thereby resulting in required supply and easing of farm gate prices, the global trade uncertainties are to be watched out for.
Coming to the Company’s performance in the Q4 of FY25, we witnessed an improvement in revenue and profitability when compared with Q4 of FY24. The sequential quarter on quarter decline in revenue led by lower shrimp sales is in line with the seasonality factor. In general, the net revenue group around 22% year on year to rupees 197 crores in Q4 of FY25 mainly led by higher realizations amidst a marginal growth of 2% year on year in volumes sold in Q4FY25. Our average realization increased to rupees 794 per kilo reflecting a year over year growth of 20% and a sequential quarter on quarter growth of 6%.
Gross profit grew 24% year on year to rupees 59 crores in Q4FY25 with margin at approximately 30% on a sequential basis. Gross profit margin improved 500bps quarter on quarter from 25% in Q3FY25 as farm gate prices which had elevated in Q3FY25 started correcting following the global trend the trade uncertainties. Our average purchase cost of raw Materials was rupees 358 per kilo in Q4 of FY25 representing a 4% decrease quarter on quarter. EBITDA grew 174% year on year and 23% quarter on quarter to rupees 780. Sorry 78 million bad positive profit after tax positive at rupees 20 million in Q4 FY25 as against a loss of rupees 4 million in Q4 FY24 and a loss of Q2 sorry a loss of rupees 2 million in Q3 FY25.
Shrimp sales grew 2% year on year to rupees 3 sorry to 2,349 metric tons in Q4 FY25 as against 2,302 metric tons in Q4 FY24. For FY25 it stood at 10,534 metric tons as against 10,949 metric tons in FY24. The European Union market while excluding the United Kingdom remained strong throughout the period. The company achieved a year on year sales growth of 70% in Q4 FY25 and 41% in the full fiscal year of FY25. Consequently, the EU market’s contribution to the overall sales mix increased to 36% in Q4FY25 which is up from 22% in Q4 of FY24 and to 39% in FY25 compared to 26% in FY24.
This growth has contributed to a more geographically diverse sales portfolio which gives us the confidence in the EU market’s long term potential amid improving global demand. Shrimp prices have shown a consistent upward trend. Our Average realization in Q4FY25 has grown 20% year on year and 6% quarter on quarter to rupees 794 per kilo for a full year. For the full year of FY25, it grew by 5% year on year to rupees 729 per kilo from rupees 695 per kilo in FY24. Going forward, global trade uncertainties remain. Following the US trade tariff announcements reciprocal tariffs announcement, we do remain cautiously optimistic for the near term.
Some of the encouraging indicators include ongoing inventory liquidation, rising demand and a decline in major ocean freight costs. Furthermore, the current favorable pricing environment for the Indian shrimp farmers strengthens the potential for increased shrimp cultivation in India over the near to medium term. With that, we can now open the floor for question and answer session. Thank you very much. See you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Raman KV from Sequent Investments. Please go ahead.
Raman Kerti
Hello sir, thank you for allowing me. To ask you question. Sir, I just want to understand what is the current capacity utilization in terms of shrimp production?
Karuturi Chowdary
The current capacity utilization for the Q4 was 29% for the full year. It was 30% actually last year. As you know in the earlier quarters also there was a decline in the overall utilization of the capacity for the full year. It was standing at 30% only.
Raman Kerti
And sir, can you also guide on the inventory levels, how was it panning out in Q1 and also with respect to the global demand because in the Q1 and what do you expect going forward in FY26.
Karuturi Chowdary
Overall as stated earlier in our opening remarks, the definitely our customers are also they have been seeing a good sales on their end thereby creating a demand for the products from our side which also is making way for us to use even our inventories also our company’s inventories. And within the present scenario we also need to acknowledge about the uncertainties which are prevailing which also have been stated in our opening remarks. As you know that it’s kind of a global trade war like situation where you know because of these reciprocal tariffs which have been levied by USA which are currently at 10% which are there affecting in the Q1 from the Q1 of FY26 which you asked specifically.
Of course however those tariffs are all are being taken care by the customers to a large extent they are being taken care overall. So because it is obviously it is a US specific scenario but as you know we take cannot exactly predict what is how the. Whether it is our major market like usa how they are going to decide in which direction. We are very positive. We remain optimistic on the part of the trade talks but end of the day we should see how the results will come out because we do notice every day, every week we understand that the talks between India and USA are very positive and they are looking forward for an early agreement.
So but at the same time we, you know we can’t put in our entire, you know, we can’t keep. We can’t be on a high optimism as such because we also have to be a little bit cautious. That’s why we specifically mentioned that we are cautiously optimistic because we are certain uncertainties still loom around so we are waiting for those results. But definitely as there are more concrete steps are being taken by both India and USA especially I think that will be more positive. So we are looking forward for any such final decisions which are done in such a trade deal between India and USA that is regarding usa.
But in the case of other countries we have been able to diversify very well into the other markets and one of the important point is with regard to EU so our European sales have been picking up from the beginning of last year and we continue to you know, bet high on them currently. So we can continue to. But still of course we will still have USA as our major market but in one way it helps us to in a good well planned diversification. So that is definitely going to help us with regard to our business for the current fiscal of FY26.
Raman Kerti
Okay sir, so my final question is with respect to the earlier guidance of 12,000 metric turns in FY26 is the guidance still intact? And also with respect to the ready to meet division, what is the status of the approval?
Karuturi Chowdary
Good question. First I’ll answer on the approval part. The new capacity, most of the facilities as in the past two months we have seen at least of course the last approval was on April 1. They are approving, they are listing all the new facilities one after the other. We expect ours also to be done very soon. Unlike the past when it was very uncertain. Now in that regard certainties have improved as they started improving or actually listing out all the facilities one after the other since March and April both. Since March, April Months they have started approving all the facilities in India and those facilities which were pending for approval since 2020 onwards, they all have been one after the other are being approved and we are just awaiting anytime soon.
So the moment it is done, it is. It paves way for us to grow our ready to eat business also in our next the second largest market of the European Union. That is to answer your question on that. And with regard to the volume for FY26, we definitely if as the certainties increase and improve, definitely we will be looking forward to do that volume if certainties are increased. So we are waiting because as you know of these uncertainties which are there, we expect that such uncertainties should be cleared off by the end of Q1. We expect that especially with regard to the trade deal announcements and all that hopefully by the end of Q1 or early Q2 it should be cleared.
That will definitely look forward. We can look forward for. Because we still are dependent on the US market. It should be a major market. So when we talk about the volume numbers, the majority of the volume will still continue to be shipped to the US market. So we will have to just wait for that at least in the end of Q1 to you know, once the trade dealer or any. Once these uncertainties are removed from the market scope, definitely we’ll be able to be more concrete on that.
Raman Kerti
Okay, thank you sir.
Karuturi Chowdary
Thank you.
operator
Thank you. The next question is from the line of Siddharth from I thought pms. Please go ahead.
Saad
So my question is like you said that you slowly improving facilities out of your current capacity of almost 34,200 metric tons, how much is like is unapproved by the EU?
Karuturi Chowdary
25,000.
Saad
If this approval is received, you will be able to sell almost 25,000 metric. Canterbury.
Karuturi Chowdary
Well, if the approval is there, first thing we will be able to open up our ready to eat production lines which we are currently missing for our business for the EU market. Yeah. So those back to production ready to eat production lines especially are to the tune of around 10,000 metric tons on an annual basis.
Saad
So you will be able to sell, including the ready to eat. You will be able to literally sell if there is demand or literally almost.
Karuturi Chowdary
Oh yeah, obviously, which. Correct. Obviously when the market access is not there because of some regulatory issues which have been persisting for quite a number of years. And now as these approvals are being provided facility after facility and we are just any maybe today or tomorrow, we don’t know. We are just waiting now it’s more certain they have Been allowing all the Indian facilities which were blocked for almost four years in a row. So that is good. So that’s a very positive sign. So, so definitely we’ll have the entire, the new capacity, including the 10,000 metric tons of ready to eat will be made available.
Correct.
Saad
So like a part of that question I have is like in your opinion, are there a lot of capacities in India which will be like yours, wherein they’ll get approval from you in the near future?
Karuturi Chowdary
Well, there have already been capacities which have been approved in the past.
Saad
Awaiting approval.
Karuturi Chowdary
As I said, as I stated, there have been, they have been waiting and some of them have been given in the past two months. March, April, some are yet to be given. But it is not just about getting approval from the country. It is also the, you know, having market, the requirements of the market also to be met by the respective facilities or, you know, entities which are involved in the processing and export of these products. So there are, it’s just not about having an approval. You can have an approval and you can also lose it if you do not approve.
You know, kind of follow the required. Yeah, yeah, sorry, yeah.
Saad
Like let’s say we get approval from the European Union.
Karuturi Chowdary
Yes.
Saad
Will we be able to take away market share in the EU from countries like Ecuador and Vietnam, in your opinion?
Karuturi Chowdary
We will be. We, we are confident that we will be able to target some extent of market share from Vietnam, Ecuador. We are not competing, we are not competing with Ecuador on the ready to eat products in eu we are. India is mostly competing with, I mean whatever little competition India gives. It’s not a major competition in the EU market. But whatever little competition India gives, it is mainly against Vietnam, other Asian countries. Yeah, Vietnam and Indonesia.
Saad
Like you said, if the products which are sold, barring the ready to eat in let’s say eq are they value added products or like commodity products?
Karuturi Chowdary
They are value added products mostly. Whatever in Vietnam and Indonesia does is value added. Whatever Ecuador does is commodity. We are in between.
Saad
So I just want to clarify the quantity which Ecuador sells in EU is largely commodity. Like products are.
Karuturi Chowdary
It’s a, it’s a raw material which is just frozen which is basically there’s no, no processing done except. Yeah, it is just the raw material which is frozen. So you get the point. It is just head on shell on basic product where it doesn’t require much of processing to be done. In fact, Almost more than 60 to 70% of Ecuadorian exports to the world, mainly to China number one, and followed by European Union is mostly head on Shell on, which is like you asked, it’s a commodity shrimp which doesn’t require any processing, any significant processing.
I’m sorry, I shouldn’t say any significant processing. And it is just, you know, freezing the raw material and shipping them out. Understand?
Saad
So like our competition is going to be Vietnam, not Equator. In eu.
Karuturi Chowdary
In the EU it will be mostly Vietnam and Indonesia especially. Correct. And which we are, which we are actually we are even competing even now and we will continue to compete even in the future. Yes.
Saad
Okay, understood, understood. I’ll just have one more question. Like in FY25, FX made almost 50 crores cash flow from operations. Right. And you just had 5 crores of fixed asset investment. Okay. Do you guys have any like plan on what you are going to do with the cash? Are there any investment that you are planning the next year?
Karuturi Chowdary
Not in the next year. Right now there are no plans for additional investment except for some, you know, some power backup systems and all that more. To look on efficiency factors to improvise the efficiency and the cost with regard to reducing energy costs or basically mainly any investment which is going to be done in the current in the next one year is mainly to improvise the efficiencies in the existing capacities, mainly for the. For now so that, you know, we can utilize them better. As we are looking forward to utilizing the capacities better, we obviously want to do it in a more efficient manner so that we can bring down the overall costs.
That is, that is the plan for the first immediate year. First year. Yeah.
Saad
Thank you sir.
Karuturi Chowdary
Thank you.
operator
Thank you. Before we take the next question. Thank you. Before we take the next question, I would like to remind participants that you may press Star and one to ask a question. The next question is from the line of Purshottan from ViceOld Bird Ltd. Please go ahead.
Purushottam
Hello. I would like to know. We have this UK FTA that is bilateral agreement has been done so. But we do not have anything for UK as of now. But we. Our main configuration is on eu. How do we plan to have geographical expansion? So whether this UK FT agreement will benefit US. Or. Because if you see the major export markets for US is US and recently in the last couple of years we have increased to EU and rest nothing much. So we do not have anything from China and Japan. I. I’ve read some time ago that we are also concentrating on these markets. Whether we are targeting the UK market.
Karuturi Chowdary
Well, actually UK is also there, but we in the current year it was mixed in the others category. Last year FY24 we did more to UK but this year it has been reduced in FY25. Last year it was almost 7.5% of the total. Sorry, that is in the quarter. But on the. On an year wise, if we see UK is last year we did 3.4% and for the full year, this year FY25 it is 5.1%. For the full year FY25, our UK sales is 5.1%. So it is more than China and other countries and. Yeah, well, we currently believe once it is effective, the FTA is effective.
We believe it will give us advantages for sure because the customers also will treat us, you know, with more. They will be more positive in doing more volumes with us. So we can definitely take it up to at least minimum 10% in the first year. I mean, given whenever the FDA gets fully implemented, the announcements are done. We are of course there will be procedural steps which are yet to be taken. But our customers are positive, but they are also, as I stated, are awaiting for the implementation.
Purushottam
Okay, sir, another question. Thanks for that. Another question is on the ready to eat product, right? So you have explained that we might get any time the approval for that. And if we get an approval, whether we will be able to utilize the complete 10k in span of 1 year or 2 years, when do we expect that?
Karuturi Chowdary
Generally the state generally the stated capacities, 80% of them is very optimum. So even, let us say even in a 10,000 tons out of 8,000 metric tons, for example, if within the you and we are not just going to entirely depend only on the new market alone. But of course we will also be pushing our retail sales overall to the US Market which is the major user. The retail segment is a major user for the ready to eat items where definitely that will be quite helpful. I mean for the U. S definitely once the approval is there.
But we will also be pushing our sales to the US retail and thereby want to utilize the ready to eat capacity even more than what we have been doing in the past two years. That we are definitely focusing on that. So if the EU approval comes, it will be an added boost for the overall capacity utilization.
Purushottam
Okay, sir, so the rough estimate of capacity utilization for ready to eat what you have in your mind or FY27 or FY26 and 27 ready to eat and the normal all other rest are.
Karuturi Chowdary
There as stated earlier. And as you know, the uncertainties still loom around. We are positive, but at the same time we are, you know, just watching because of these various uncertainties which are theirs. And we will continue to depend on majority on the USA and trade actions, tariffs. All these will definitely play a role in how the business is conducted overall. But definitely with certain positivities at the, you know, farm gate level. Farmers looking forward for stocking and more supply being made available and to support that demand from the overseas markets remains consistent. As India has definitely proved its position with regard to delivery and also consistency in the product supply.
It is definitely a positivity which is there for India in general for the next one to two years. However, we have to keep this tariff action or trade action, sorry. In mind. So with these uncertainties it is really getting difficult and because how to phrase it is that if everything is running in a very systematic manner, it is different because here even our customers, especially in the US are little bit not only us, I mean customers in the EU as well as some of them in China. China are also a lot of uncertainties because US tariffs are not on India alone, they are all on multiple countries which thereby affect the overall, you know, how the.
Because you need to understand if one manufacturing activity, one country gets affected because of US tariffs that does affect that that country’s overall consuming, you know, consuming patterns also. So which means, so tariffs in USA necessarily need not affect the business to USA only. It can also have an impact in other countries also. So these uncertainties are looming around and we expect those to be cleared hopefully in the next two months maximum June, July, I think hopefully by the end of this month or early July we should have some better clarity. And once we are living in a certainty world, definitely we will be, you know, able to say at what rate or at what, you know, at what extent we can do.
I hope you understand what I’m emphasizing here.
Purushottam
Yes sir.
operator
Thank you. The next question is from the line of Amita Gitia from Edgy Hawa. Please go ahead.
Amet Khicha
Yeah, good morning sir. I’m not audible.
Karuturi Chowdary
Yes, yes please.
Amet Khicha
Thank you for the opportunity sir. And so my question was from last 12 years perspective, like if you note from March 14 onwards till the COVID March 19 or 20, you can say the revenues and net profit and everything was on the uptrend. The margin or beta beta margin also was increasing from 6% to 10, 11 and onwards. But post Covid like something has happened. The revenue is also like staggering. I think EBITDA has fallen and the net profit has also come to single digit. Now can you just put some insight in, what are your comments on it?
Karuturi Chowdary
No, definitely. Okay. I mean this has nothing to do with COVID Specifically. But of course, definitely Covid played a role in everybody’s lives. But as far as the business trend is concerned for the capacities, what we were having of our own or even on leased basis at that point of time before COVID and finally post Covid, whether, you know, we are having our own capacities, we did do. I think FY22 was a. Overall it was a good year for us post Covid. I mean especially considering, you know, we actually did our historically high numbers. I think as far as volumes are concerned in FY22, I guess.
And the thing here is post Covid, we did have. We did face certain challenges. Again not specific to Covid, but overall market dynamics changing. And obviously we did lose some of our customers for brief period, at least for a year like two years ago, which has also has happened in 23 and little bit in early 24, which we have been gaining them back. We did also overall we did lose some of our market share to our competition in Ecuador to a certain extent, which did happen. Some of our sales which we were doing, we also did.
Ecuador also played a role in general, but in our company specifically, certain customers did switch to the Ecuadorian supply which did have an impact on us directly. That is one of the reason where we started also pushing to other markets. And I mean whether it is the EU, especially the EU, we have been diversifying and FY24 if we. FY24 and FY23 or FY24 and FY25 if we look at it. Hello.
Amet Khicha
Yes. Yes.
Karuturi Chowdary
Yeah, FY25 definitely we are looking at a turnaround and since towards the end of the year we have been seeing better Q4 and thereafter. We have also seen a better increase in our sales force. I mean our order book also compared to the earlier quarters. And we believe that we will be able to do better going forward. There was a gap in between for almost two to three years like you rightly pointed out, especially FY23 and FY24. FY25 last two, three years it has been little bit slow. But we have been taking steps to. Especially with regard to some of our loss of sales in the US market.
It took time also to get it replaced in the EU market. But finally we are there and we are also parallel. We have also been able to regain some of our customers back in the US also. So overall this did have an impact for almost two years with regard to our sales definitely as far as margins are concerned. Obviously the pricing which has been affected of course at the Farm Gate level also it was higher. Added to that the company had been having some provisioning which has been done for some legacy related issues like earlier.
Some, you know, like hatchery data and all that. They were. Some of them were also there which were also creating a overall issue for the company. So we had to do away with all those which was being done in the past two years especially. So there is one. So these were all like the one offs based on the progress being done on the recovery. And eventually they were. The call was taken and the company had decided to basically do away with such sort of old bad debts rather so obviously that also affected the overall profitability of the company to such provisions.
Those have all been cleared off. So that was on the. You specifically asked both on the revenue as well as sales as well as on a profitability? I think I answered on both the points. Yes.
Amet Khicha
Specifically I’m talking about the EBITDA as well. It was for four years it was in the range of 11 and 10 and 11 and 11% then started falling down to single digit 9, 8, 5, 3. There’s a constant fall in EBITDA margin. So what immediate steps are the company taking to that at the bring back to 10% level again?
Karuturi Chowdary
Well, the only way to actually increase the EBITDA overall is obviously to have a better realization or higher realization given the costs increasing. It is just that our sales prices obviously have been very kind of rooted not in a very firm manner. They have been slow because of the troubles at the destination markets. But at the same time the cost escalations at the farm gate level here also definitely impacted us overall on the EBITDA level. So the only way to that is we have to enhance our value obviously and we have to look at for selling at a higher price which we cannot do in the products what we have been doing in the past.
So that is one of the reason we are also changing the products or rather going for which we have been planning for the past four to five years to do. And that is what we have to increase definitely to increase on the beta level. We also have to definitely have to increase the our realization value definitely. So that is the main part which is there because cost escalation at the farm gate level is in keeping our farm gate prices quite firm. Obviously there will be periods where we will have tailwinds at the farm gate level also.
Like we may have something like as we have currently, for example, we will have those but they are not going to be there through the year. So. So in order to support An EBITDA growth. Overall we will have to focus on getting an enhanced value and depending on the products what we do. We also are working on that changing the type of products so that we get a better realization with the given increase in costs at the production level.
Amet Khicha
May I ask one more question?
Karuturi Chowdary
Yes please.
Amet Khicha
So assuming the present status quo like the uncertainty about tariff and everything is okay, assuming that suppose hopefully that 10% thing stays then is it possible for you to give us the volume realization of margin guidance for FY26?
Karuturi Chowdary
As I think one of the earlier participant has mentioned, it is true. We gave a number of, you know, earlier we said around 10,000 metric tons for FY26. So we are definitely going to work in that direction. But on the margin front I’ll not be wanting to give you any specific guidance at this point immediately but I would rather want to wait more for the, you know, end of the first quarter. So on the volume front we are looking forward to do that. 12,000 metric tons minimum.
Amet Khicha
Answering in detail sir. Thank you. And all the best for the future.
Karuturi Chowdary
Yes, thank you.
operator
Thank you. The next follow up question is from the line of Siddharth from I thought pms. Please go ahead.
Siddharth Agarwal
Like you mentioned from the. For the previous participant that something which I wanted to ask about like this quarter realization is up 20 percentage year on year and 6% and you also said that there’s been a turnaround based on the sentiment right now. Like can you expand on that?
Karuturi Chowdary
Do you. Sorry, go ahead. Sorry, go ahead.
Siddharth Agarwal
Are you actually sensing that this is the time that this industry is in.
Karuturi Chowdary
The.
Siddharth Agarwal
Like going to be better off from this point onwards?
Karuturi Chowdary
Sorry, our answers, our responses were not about industry in general. We were specifically talking about. Yeah as a company. The reason being of course we have. We also were very transparent in acknowledging that we did lose some of our sales to some of our competition in other countries also and which we have been gaining back in the past few months. And at the same time when we stated that we have been focusing on diverting to other markets also, which is very much evident with the way we have been growing, especially in the European Union and we continue to pursue other markets so that we can still have an overall very positive growth for the company in that respect.
We have stated that we believe we have come out of the negatives which is basically heavily concentrated almost to the extent of 80 to 85% in one market which was the USA at that point of time. And so all that that was in that context I have stated. We have stated that it is a. We. We have a kind of a turnaround situation in the year FY25 and we also. We also stated that we are done away with some of those legacy issues which are hanging in the company related to any sort of provisioning and all that which have been done which that has been taken up in the past two years.
So obviously I have called it a turnaround for the company because we are done with all those old problems and that. Yeah. And not in. Not in any generalized manner for the industry overall. I can’t. We can’t state anything.
Siddharth Agarwal
Quarter for this company.
Karuturi Chowdary
Right. Generally. Generally Q4 is less sales. Usually. Usually Q4 is for the industry overall because the supply also buying also will be. Most of the buying will be done for Q1 and Q2 overall. What you rightly mentioned. Usually first half is the major business which is supposed to be there. Again that was not the case in FY25. Also if you look at it the first half, I mean comparatively only 1/4 in the first half was good. I mean. I mean good news on the sales volume wise even though it was lesser compared to earlier periods.
But Q4 is overall it is little bit lower. Yes.
Siddharth Agarwal
Realization is up 20 percentage year on year.
Karuturi Chowdary
Right.
Siddharth Agarwal
In this quarter. So is it because the demand is revised?
Karuturi Chowdary
I mean yes, we have a realization of. There are you also one is unit value. One is unit value for a dollar in dollar terms like you rightly mentioned, the demand has picked up and the pricing also has improved especially from the middle of Q3 onwards which definitely reflected in the sales of Q4 added to that. We cannot ignore the factor of currency equation here. The rupee also has depreciated or however we want to call it as the dollar has appreciated. And that also is one of the factor which plays the role. So if we look at it Q4 the average realization was 794 rupees per kilo compared to Q3 which was at 749.
So this is not only there were two factors here. One is the unit value overall because of the demand and at the same time depreciating local currency also supported it.
Siddharth Agarwal
How much is the contribution of this currency?
Karuturi Chowdary
Well, in the overall scenario we have seen, I think it was roughly around 3 to 4%. I believe was on the currency front roughly around 4%.
Siddharth Agarwal
It is year on year, right?
Karuturi Chowdary
No, during the year. I was specifically stating during the year, you know, the currency itself has depreciated well. In fact it reached almost. It peaked up almost to 87 and odd it almost. Yeah. So that also is there. It plays a factor. But at the same time our unit value in dollar terms also it has grown by almost 7 to 8%. Additionally in dollar terms.
Siddharth Agarwal
Okay, 7 to 8% is. Understand?
Karuturi Chowdary
Yeah.
Siddharth Agarwal
Now like one more question. I have is 8 rupees per kilo.
operator
Sorry to interrupt. Mr. Siddharth, I would request you to please repeat your question. We lost your audience.
Karuturi Chowdary
Okay. Okay.
operator
Mr. Siddharth, we can’t hear you.
Siddharth Agarwal
Yeah, okay, I have it. At the current cross rim price of 358 rupees per kilo, are the farmers making money?
Karuturi Chowdary
See, farmers making money is something which we would not be able to answer entirely because it depends on multiple factors there. Not just limited to their costs, but also their output, their farm level conditions, their efficiencies. So it depends on their planning. If they are doing multiple harvests enough in a single crop, it may plays a different role. And if the growth of the shrimp is not there at the farm level, that plays a negative role for their overall that cycle, that crop. So we wouldn’t be entirely able to say that because it depends on how each respective farmer has their output or their harvest happening.
Now as an average price of 358, you need to understand it’s an average of multiple sizes. Depending on what we did, there could be another company which may have 380 rupees as purchase price, average purchase price. But at the same time their sale price also could be higher because depending on what sizes they have been doing. So there could be somebody who would be doing larger sizes. Obviously it will be at a higher cost. Of course it should also reflect in a higher sales value. So the 358 rupees is something pertaining to our company’s purchase price during the quarter.
Please understand that this is not what the farmer is getting. Literally it could be depending on what sizes he’s harvesting. We buy anywhere between 250 rupees to 500 rupees. That is the range depending on the sizes. So we wouldn’t be exactly be able to answer that because it depends on what they have harvested and what were their costs and whether they got the yielding in a reasonable manner or they had a negative yield where they lost and their cost escalated. So it entirely depends. But in a general perspective they are okay as long as they don’t have problems, means any sort of disease problems or anything, they’re okay.
The, you know, so most of them have been fine. They are reporting, they are, to be precise, if your question is in today’s market scenario. Are the farmers okay? We find them to be okay. They are going for stocking again. We see our seed sales improving. It is also going in a positive manner. We do understand that the farmers are positive for now. Unless things go south negative, then it is different. There were certain corrections in the palm gate prices even in Q1 that is in the current quarter Q1 FY26. That obviously is related to all these tariff actions and all that.
But overall they are fine. They are going it’s main. It all depends on the farm level conditions rather than it’s not entirely dependent on the pricing alone. Please understand that because their costs get affected based on how their farm level economics work. Not just on the cost but also dependent on their survival teeth at the farm level.
Siddharth Agarwal
Okay, thanks.
Karuturi Chowdary
Thank you.
operator
Thank you. The next question is from the line of Tom from GeoGyp Financial Services. Please go ahead.
Tom James
Hi, my first question is regarding EU approvals. What are the kind of client relationships we are having, like how confident we are regarding a certain sales volume we can generate out of EU if we get the approvals.
Karuturi Chowdary
We already have relationships with the EU customers who are willing to support us and we are looking forward for our approval to happen so that they can also start buying the products from the newer new facility that the second facility.
Tom James
Can you give us an approximate volumes like what we can expect from EU post approval?
Karuturi Chowdary
Well, we will be able to grow it at least minimum 30 to 50% in the first one year of approval. That is how confident we are based on our relationships and how the overall market demand in the EU is happening.
Tom James
Okay. In absolute terms that would come to around.
Karuturi Chowdary
Roughly one minute. It will be. We’ll be able to grow around 2,000, 2,500 metric tons in the first year itself for the EU market alone. Additional, additional. Additional volume. Yeah, roughly approximately.
Tom James
And regarding UK volumes, is there any approximate growth or absolute number you could give us?
Karuturi Chowdary
We will not. I mean we will wait for the tariff, sorry for the FDA to get implemented. I think we’ll be able to give even a better. Because that keeps changing. It has been higher last year to certain extent. I mean last quarter it keeps changing on quarterly basis but overall it had increased. But we believe we are looking now we are starting even ready to eat products to the UK this year. This quarter we are also starting them so immediately. I think we will be able to give much better clarity, hopefully positively next quarter when we get the clear indication of the effective implementation of the fda.
Tom James
Now my second question is regarding the farm gate prices Is there a decline from March exit till the current situation? Like what is the kind of farm gate prices for the like for life sizes right now?
Karuturi Chowdary
Roughly around 8 to 10% reduction. Was there? I mean roughly, let us say it is currently sitting around 7 to 8% compared to what it was in the month of March to now. Roughly. I’m just saying, I mean it went lower but again it will marginally it will pick up. That keeps changing demand, depending on the demand and supply of sizes and all that. But overall post tariff announcement there were corrections. Yes, at the farm gate level.
Tom James
Okay. And the average Q4 farm gate prices was.
Karuturi Chowdary
The average Q4 farm gate was 300. I think that was discussed earlier with the earlier participants. 358 rupees for us, for our company.
Tom James
Thank you. Thank you so much.
operator
Thank you. The next question is from the line of Sourav Sharf from QRC Investments Advisors llp. Please go ahead, Go ahead.
Saurabh Sharma
Thank you for taking my question. So just want to understand, since the big tariff announcement in early part of April, what have you seen in terms of buyer behavior change from your clients and customers in the US Largely are they trying to pre buy? How are they sort of dealing with the uncertainty and what impact is it having on our business?
Karuturi Chowdary
Well, definitely there was a lot of chaos. There was lot of, you know, kind of confusion which was created during the first few days of the tariff announcement. But subsequently when the honorable President of the United States had announced to keep the, you know, increased tariffs beyond 10%, whatever they were, like for example, 16% in the case of India in abeyance for 90 days, definitely that kind of, you know, cleared the air for many customers to continue their purchases, number one.
Number two, with the increase in prices, sales prices due to this 10% implementation, which is definitely implemented on all the, all the cargoes, all the shipments from the beginning of the current Q1, pretty much most of them, all of them actually these prices were also there in 2022. It’s not like these prices are something very high, abnormally high, that the business cannot be conducted in the US market. So we have been selling at these levels even in the year 2022. And then there was a correction of course, big correction in 2023 subsequently to that. And now post this tariff announcement, we are back to those numbers.
The customers are continuing to buy at this, considering that the tariff rates will be at 10%. But post 90 days we need to see how the trade deal is going to happen. Definitely. Everybody is very much cautious, even our customers. They want to See what is going to happen post July 7th or July 9th once the, you know, this 90 day extension period is done. So we need to see how it will happen. Meanwhile, if there is a trade announcement hopefully between India and USA towards the end of this month or early July, that will be very helpful for sure.
Or whether the honorable President of the United States will again give another extension or not. So those uncertainties still remain. What will happen, how this will be there. And yes, our customers are very cautious. They are, you know, looking forward, for example, the purchases, what they have been making, they have been very, you know, very concrete on the shipment dates, delivery time schedules and all that. But at the same time the buying has not stopped. In fact, we are working on some new programs which are going all towards the end of 2025 and early 26.
It’s not that people will stop eating shrimp because there are tariffs. They will create some space, I mean some little bit of pressure definitely on the price point. And we also have seen many announcements by end retailers also in the USA because this is not shrimp alone. The tariffs are hitting across the board on multiple products. So overall retailers are also planning to increase their prices, their selling prices. So obviously it will be the in the USA who will be taking some of the, you know, increase for sure into their cost. And as we stated earlier, these prices are not new.
These prices have been there earlier also just two years ago, I mean almost three years ago in 2022, we have been selling at these levels only. So it’s not something new. So that, but confusion still prevails. So the cautious approach still prevails, both from the customer side, even though they are planning for programs for the rest of the year. For the holiday sales and also early part of 2026. We have requirements coming in for both Q4 and Q1, Q4 of current calendar year as well as Q1 of next calendar year. So different programs are being worked out, but they are very cautious.
We are also cautious. We are just waiting. But overall, people need the product, the customers need the product, consumers continue to consume the product. It’s not that they stopped consuming because tariffs are coming. And that’s where I was trying to emphasize that these prices also prevailed three years ago. These prices are not something historical. High numbers. We have seen higher numbers than these in the past.
Saurabh Sharma
Okay, sure, sure. And if I may, now that we are quite close to getting the approval for the RTE line, can you maybe help us understand what, what, how does this sort of improve our realizations and margin profile? Let’s Say versus Ready to cook.
What can we expect in terms of margins? Especially
Karuturi Chowdary
first and foremost there will be an increase in sales in the ready to eat for sure for the market of EU overall we look at a better realization for sure that will be increasing almost. We look at it almost 15%, 10 to 15% better realization part minimum. But at the same time we also have to look at the additional costs which are involved for doing those products. But main thing is we have to understand that even though the ready to eat product capacity will be made available to the for the new market we are expecting in the first year, as we stated to earlier, we are expecting a marginal growth in the first year.
And as we continue to deal with more retail markets in the EU once our we are not able to approach to certain customers even today without having access to that product. I mean that capacity obviously we cannot talk. So for every solicitation of product requirement which comes our way, whichever has any ready to eat component, we are currently ignoring that entire requirement because we are not able to produce that. So those such kind of things will not happen obviously when we have the access. So we will be able to do it in a better way.
Yes, in general realization wise, always between ready to cook and ready to eat almost a minimum of one and a half dollar minimum difference will be there. One one and a half dollar depending on the sizes and the type of products. Again so minimum difference will be there. But and of course with the additional costs and all that we also need can also look at around 40 to 50 cents per kilo additional margins. I mean but again it all depends. Finally after the, you know that 40 to 50 cents we have additional costs also. But we have to keep that in mind.
So we are just looking waiting for improve. I mean first to start the sales in the ready to eat once the access is market access is provided to us. Okay, thank you very much.
operator
Thank you. The next follow up question is from the line of Purushottam from Vice Old Board Ltd. Please go ahead.
Purushottam
Yeah, sir, I want to know because our company is being a visionary company. So we started from leave the capacities to own capacities and from ready to cook to ready to eat. So what is the vision that you the company has for next 5 years? How do you see what are the geographies that we target? How will be the revenue contribution from each of the geography that we have in our mind? And how does the whole scenario look? I mean if the company has certain plans, right?
Karuturi Chowdary
Yeah.
Purushottam
Wanted to know that.
Karuturi Chowdary
We have amended our ideas and visions over the past few years. So definitely we want to reduce our dependence our company wise. We have seen certain examples in the rest of the world. And we want to reduce our dependence on one market which we have been doing. And we want to, like you rightly mentioned, we want to diversify very well into several other markets and you know, thereby of course in our growth, in our volume growth. We want to use that capacity for all other markets rather than, you know, the existing saturated, I mean existing market rather where already there’s enough volume which is being done.
That is one part. So obviously which means that we will be growing our volumes more into other markets parallel, thereby at some point we believe we shouldn’t be doing more than 50 to 60% of our total volume. More than 50% we shouldn’t be doing to any one country. We don’t, I don’t want to take any means here but I think we should cap it up like that, you know, so that we don’t do more than 50%. That is on a high side. And the more diversification we have, the less impact in the negatives if any we will have because of any such measures or you know, any actions or any uncertainties which may loom around because we are not able to today in the rather uncertain world with the way things are going on all over, you know, a lot of assurances are not available to us itself.
So for us to give you or to provide to anybody. So we are actually, you know, working on it with caution to be precise. But we will be diversifying more very well. Even in the current year, we want to push it out, as I stated, over a period of time in the next few years. We want to restrict even our number one market to 50% or lesser than 50%. So that’s how we feel in an increased volume scenario. Obviously in an increased volume scenario we’re utilizing our capacities to the optimum.
Purushottam
Okay.
operator
Does that answer your question? Thank you. The next question is from the line of Mayank Patel who is an individual investor. Please go ahead.
Mayank Patel
Hello.
operator
Mr. Mayank, you can please proceed. Mr. Mayank, due to no response from the current participant, we will move on to the next participant which is a follow up question from the line of Sourabh Shroff from QRC Investments Advisors llp. Please go ahead.
Unidentified Participant
Yes, Ashwar, just wanted to know what is our RTE sales in the current year and last year in terms of tonnage,
Karuturi Chowdary
the share of current year? Of course, current year it has dropped down to 10%. Last year it was 16% on volume terms. In volume terms.
Unidentified Participant
Yes. Okay. Thank you.
operator
Thank you. The next question is from the line of Sriram who is an individual investor. Please go ahead. Mr. Sriram, I would request you to unmute your line and speak please.
Sriram
Yeah, sorry. Thanks for the opportunity. I joined the call a bit late so I’m not sure if this was discussed. My question is what is the current tariff structure for Ecuador versus India and whether the, you know, our export market share is steady or increasing.
Karuturi Chowdary
Is the tariff structure you mean for these additional tariffs which will. Which were really imposed upon it is the same for everybody. Currently it is 10% on all products whether it is Ecuador, India, anybody, Vietnam. Currently it’s all at 10% for now.
Sriram
Okay, so. So the total, let’s say that for the total landed cost including other duties, what will be the structure? This is the extra additional 10% rate.
Karuturi Chowdary
Yes, but see earlier the tariffs were already prevailing with regard to anti dumping and countervailing duty. So currently India has roughly around 7.12%. Roughly with regard to US market. In the case of Ecuador they only have. I think they only have one duty which is in their case they have CBD duty, countervailing duty, they have 3.78%. Ecuador is at 3.78% currently.
Sriram
Okay, 3.78 versus 7.1. Okay. Okay.
Karuturi Chowdary
Yes sir.
Sriram
But do you see the share of exports steady or is it increasing compared with Ecuador?
Karuturi Chowdary
Well see they have certain advantages for for sure on their side because they are close proximity to the US market. Their delivery times are lesser compared to us subject to them shipping. So anyway, so overall the delivery times are lesser. For them it takes 10 days. For us it takes around 45 to 50 days. That definitely plays a role in the customer’s decision making also. But the overall scenario is such that we have the ability to produce the products which the US needs in a much better and bigger scale compared to then that’s how I would keep it.
So it’s not like what products we can produce. Whether we are producing the products which the market that specific market needs or not. That is the more important point. Most of their products, their production is based on as we stated to an earlier participant, it’s basic commodity which is mainly exported to China and the countries of European Union. And their third biggest market is United States. Whereas many of the Asian players, Asian countries have USA as their biggest market for the products which are required by usa. USA doesn’t buy a lot of the commodity based.
I mean head on shalom product. They need more value addition obviously. So which India Is able to do in a better scale for now. Currently.
Sriram
That helps. Thank you.
operator
Thank you. The last question is from the line of Mayank Patel who is an individual investor. Please go ahead.
Mayank Patel
Hello sir. Am I audible?
operator
Yes sir, you are.
Mayank Patel
Okay, so my question is regarding the borrowing and the expiry answer by this.
Karuturi Chowdary
Great. Sorry, can you repeat that?
operator
Mr. Mayank, I would request you to please use your handset. Hello.
Mayank Patel
Sorry, am I audible now?
Karuturi Chowdary
Yes, please. Yes please.
Mayank Patel
Okay, so my question is regarding the borrowing. What is the current borrowing of the company?
Karuturi Chowdary
The short term 67 crores.
Mayank Patel
Okay. And regarding the expenses. So are so the major cost for expenses. Are we paying for the repayment of borrowing or what? Because it is like 153 crores for this financial year.
Karuturi Chowdary
Yeah. Finance expenses is not 153 crores.
Mayank Patel
In other expenses row I. I can see like it is a 153 crore 115 other expenses.
Karuturi Chowdary
Other expenses includes ocean freight, many other expenses. It’s just not finance. It’s not finance costs.
Mayank Patel
Okay. And in the bottom of these presentation I see the export benefit which is provided by government which is 454 million for financial year. So if we reduce that from EBITDA 297. So the company is slightly in loss.
Karuturi Chowdary
So is it so currently in the current quarter that is how it has been overall. Yes, currently the situation is the export benefits are supporting to certain extent. And please you also have to keep in mind with regard to our sales in USA we are also paying for 5.77% as our countervailing duty which is mainly being levied on us because of these so called export benefits. Okay, so it’s not. Yeah, that’s also getting negated there. So you need to keep that in mind. Okay. Yeah, sorry, go ahead please.
Mayank Patel
Okay, so government recently announced in budget that that in fishery sector some custom duty has been reduced to 15% to 5%. So how much reduction is we expect in expenses part with that reduction in duty?
Karuturi Chowdary
The duties were not reduced directly on the processing sector. They were all related to the primary production which is related to feed or you know the hatchery feeds, the shrimp feed manufacturing related aspects. They will benefit the OR in the in the medium term and long term they will benefit the farmer mostly from.
Mayank Patel
Farmer, not the processing company which eventually.
Karuturi Chowdary
Helps the processing company. Obviously their costs come down. We can remain competitive in the global markets. Right. It is linked but it is indirect. It’s an indirect. Okay.
Mayank Patel
And one more thing, last question. Recently I read somewhere that PM MODI chair meeting with fishery sectors representative. So is go what what the government take on this or how government intends to support this sector or companies. Can you have some insights?
Karuturi Chowdary
I’m sorry but we don’t. We know that there were meetings held but we, we don’t have the specific details and they were more government to government ministerial level talks which we are not privy to so we are not fully aware. But we believe it’s more to increase the overall vistas that the whole idea is to increase the production of fisheries from the country. That is what we understood in a brief manner. So in one way it is good that the overall production increases in a cost effective manner. Definitely we can remain more competitive in the global markets and as ours is mostly export driven and not much in the domestic market as far as shrimp is concerned.
So definitely it will help us. But we don’t. Yeah. Thank you.
operator
Thank you ladies and gentlemen. That was the last question for today. I now have the confidence over to Mr. Chaudhsi Karuturi for closing comments.
Karuturi Chowdary
Thank you. Thank you one and all for making to our Investor call of Q4FY25 and we request you to reach out to irtex foursinputs.com for any further queries or clarifications. Thank you very much and have a good day.
operator
Thank you. On behalf of apex Frozen Foods Ltd. That concludes this conference. Thank you for joining us and you may now disconnect your lines.