Venky’s report Q1 profit drops by 79% to US$1.81M as poultry prices fall

INDIA – Venky’s India is reporting a steep fall in quarterly profit, with net earnings for the three months ending June 30 declining by almost 79% following a slump in poultry prices caused by oversupply and weaker market demand.

The Pune-based poultry producer posted a profit of US$1.81 million (158.3 million rupees) for the first quarter, down from US$8.59 million (751.8 million rupees) in the same period a year earlier.

Its poultry and poultry products segment, which is the company’s largest division, has faced prolonged pressure due to declining market rates for broiler birds, resulting in a quarterly loss of US$0.65 million (56.6 million rupees) compared to a profit of US$9.45 million (827.4 million rupees) a year ago.

Prices fell further in April when a heatwave led to panic selling as farmers sought to avoid potential losses from bird deaths during high temperatures, the company said during a post-earnings call in May.

Seasonal factors have also played a role, with the firm noting that Hindu festivals in the second and third quarters typically reduce meat and egg consumption, creating an extended oversupply situation.

Despite the poultry downturn, Venky’s oilseed business recorded revenue growth of 33.6% in the quarter, supported by stronger soy prices and steady demand for related products.

This segment processes soybeans into edible oil for bulk sale to traders and produces de-oiled cake used by poultry feed manufacturers, helping offset some of the company’s poultry losses.

Overall revenue for the quarter rose 7.1% year-on-year, driven mainly by the oilseed segment, though this was outweighed by a 19% increase in total expenses.

Previous Quarter Trends

The first-quarter results follow a weaker fourth quarter in which Venky’s reported a 60% decline in net profit to US$1.6 million (133 million rupees) compared to US$4 million (335.1 million rupees) a year earlier, largely due to reduced margins in its poultry operations.

During that period, the poultry division, which accounts for about 54% of total revenue, saw an 89% drop in profit before tax and interest, while overall revenue fell 5.9% to US$101.2 million (8.43 billion rupees).

The company’s animal health products division managed a 5% increase in profit before tax and interest in the fourth quarter, and the oilseed segment more than doubled its profit year-on-year.

New Product Diversification

Venky’s is also diversifying its portfolio by moving into ready-mix spice powders, with production starting in the first quarter.

The new line, aimed at the ready-to-cook market, is being funded entirely from internal resources at a cost of about US$1.9 million (160 million rupees), with commercial production expected by the end of the first quarter of fiscal year 2026.

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