Venkys, SKM: Poultry shares to watch out for as chicken prices fall 50 per cent in one week

Heat wave and rising temperatures have dealt a blow to chickens, as they are dying in huge numbers. Despite chickens dying in large numbers, prices of chicken in the country have gone down drastically in the last one week. Chicken prices are 50 per cent lower than they were in the last seven days, courtesy oversupply of chickens by poultry owners. Not just chicken prices, but the egg prices have also gone down by five per cent last week.

Though there is an oversupply in the market, traditionally the demand for chicken is lower in the summer and during festivals.

This is why chicken prices are sliding so fast.

On a broader scale, meat production has jumped 7 per cent in the last year. 

In the current context, declining prices can hit the businesses of major poultry companies.

No wonder shares of Venky's (India) Ltd and SKM Egg Products Export (India) Ltd. have been trading lower for a week.   

Just have a look at how the shares of Venky's and SKM Eggs have been performing of late.  

Venky's (India) Ltd 

Shares of Venky's saw a slight dip in its price today.

It opened at Rs1532.95 and closed 0.062 per cent lower at Rs 1532.

In last five days, the share has slid 0.23 per cent.

But if we look at its share's performance in the last six months, the picture looks grim, as the share has lost 21.90 per cent of its value.

The downward trend has been continuing for a year, as it is 19.17 per cent down year to date. 

Though its previous week's performance is much better than its long-term show, but if chicken prices keep falling, they can affect Venky's shares in the near future. 

 

SKM Egg Products Export (India) Ltd. 

SKM's main forte is the production of egg products.

The lower price of eggs can benefit its business in the long term, and the share can also gain strength, but its performance in the recent past shows just the opposite picture.

Its opening price this morning was Rs 142, but it saw a decrease of 1.06 per cent and closed at Rs 140.50 in the evening. 

In last five days, SKM's share has lost value by Rs 12.05, or 7.90 per cent.

Though it's a recent fall as the share had been performing up to the company's reputation for over a year.

In last one month, it gained 7.25 per cent, while it has been up 31.49 per cent in last six months.

It's year-to-date gain is 4.31 per cent, while its value has swelled by 110.96 per cent in past year. 

SKM's share price has been on a strong footing for most part of the year.

The temporary fall raises some concerns, but it can regain its strength after the declining prices of eggs.