Avangard plans to complete two egg factories worth USD 450 mln by 2011

Avangard (AIM: AVGR LN) plans to complete the construction of the two egg factories in Khmelnitska and Khersonska regions by 2011 and reach a full capacity in 2012. Each facility should consist of a 3 mln head poultry breeding factory, 40 mt/day fodder plant and a biogas plant, with the combined project costs of USD 450 mln. According the company management, the completion of the plants should allow Avangard to raise its eggs producing capacities by 35% to 6.5 bln eggs per year. Ruslan Patlavskyy: Given the current saturation of the Ukrainian egg market (average annual consumption of 320 eggs per capita at a biological norm of 280), any further increase in Avangard’s output should imply growth of its export sales. We see the European Commission’s decision on the possibility of Ukrainian meat and eggs exports to the EU, to be announced this year, to play an integral part in Avangard’s business strategy for 2012-14E.