AVT Natural Products (AVTNPL)
CMP : ₹87.2
Market Cap : ₹1,324 Cr
Price to Sales 1.68 vs OPM 14%.
Highly Mispriced as per my Deep Value Framework
Price to Earning : 19.4x
Debt to Equity : 0.17
ROCE 12.5%
ROE 10.4%
a natural-ingredients platform rebounding sharply after a two-year downturn.
🏭 THE BUSINESS
🔹 Part of the A.V. Thomas Group — manufactures plant-based extracts and natural ingredients
🔹 Core segments: marigold extracts (largest, ~42% of turnover), spice oleoresins, instant and decaffeinated tea
🔹 Four new growth verticals: nutraceuticals, derma-cosmetics, animal health & nutrition, agri crop inputs
🔹 Exports ~93-95% of revenue, with the US and Europe as top markets
📊 THE NUMBERS
🔹 Q1 FY27: Revenue ₹231 Cr (+85% YoY), Profit ₹24 Cr (+155% YoY)
🔹 OPM recovering: 7% (Sep'25) → 11% (Dec'25) → 14% (Mar'26) → 14% (Jun'26)
🔹 TTM sales growth of 45%, TTM profit growth of 59% — a sharp rebound after two drought-hit years
🔹 Credit rating reaffirmed at ICRA A+ (Stable), with the rated amount enhanced to ₹114.48 Cr in December 2025
🚀 EXPANSION PLAN AND GROWTH OUTLOOK
🔹 Animal Nutrition revenue nearly doubled YoY — ₹16.75 Cr (FY24) → ₹30.59 Cr (FY25) → ₹53.80 Cr (FY26) — backed by a strategic alliance with Kemin Industries and expansion into the US, LATAM and Southeast Asia
🔹 New Dubai subsidiary, AVT Natural DWC-LLC, incorporated April 2026 to market animal nutrition, instant tea, food additives, cosmetic and nutraceutical ingredients — alongside an already-profitable Dubai unit (₹128 Cr sales, ₹8.7 Cr profit in FY26)
🔹 Instant Tea flagged by management as the company's major growth area, with capacity expansion under evaluation to significantly scale the business
🔹 In-house marigold hybrid seed development — genuine backward integration reducing dependence on external seed suppliers
🔹 Nutraceutical division running full clinical trials with several patents already filed; derma-cosmetics has completed clinical studies and begun commercialization
🔹 Nominal capex of ₹15-20 Cr a year (FY26-27), fully funded through internal accruals, backed by strong liquidity of over ₹170 Cr in cash
🔹 New Manager & CEO, K. Nandakumar, appointed for a 5-year term — a veteran of Philips, GE, 3M, Honeywell and TVS Group
🎯 THE THESIS
A diversifying natural-ingredients platform backed by the A.V. Thomas Group, coming off a sharp rebound — quarterly revenue up 85% and profit up 155% — with four new business verticals moving from R&D into commercialization and a credit rating just reaffirmed at A+ Stable.
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4September 3, 2026 1.2K 10
