NaturalShrimp Faces Liquidation After Sales Plummet, Debt Mounts

TL;DR

**NaturalShrimp is effectively dead in the water; investors should consider their shares worthless as liquidation looms.**

AI Summary

NaturalShrimp Inc. reported a significant decline in sales and an increased net loss for the nine months ended December 31, 2024. Sales decreased by 55.2% to $163,492 from $365,184 in the prior year period. The net loss attributable to NaturalShrimp Inc. widened to $6,285,201 for the nine months ended December 31, 2024, compared to a net loss of $10,347,034 for the same period in 2023, representing a 39.2% improvement in net loss. However, the company's financial position deteriorated, with cash dropping from $115,525 at March 31, 2024, to $20,981 at December 31, 2024. Total current liabilities surged to $41,122,005 from $38,528,534, primarily due to a restructured Senior note payable of $27,600,000 and a restructured August note payable of $2,790,000. The company entered receivership on September 9, 2024, with Amplo Turnaround and Restructuring, LLC appointed as receiver, and a motion to sell substantially all assets to Streeterville Capital, LLC and Bucktown Capital, LLC for approximately $35.7 million in credit bid and $100,000 in cash was approved on March 30, 2025, indicating an imminent liquidation.

Why It Matters

This filing signals the imminent liquidation of NaturalShrimp Inc., a critical event for investors who face substantial losses given the company's significant debt and the sale of assets primarily via a credit bid. Employees of NaturalShrimp Farms, Inc., Iowa Shrimp Holdings, LLC, and Texas Shrimp Holdings, LLC will likely see their employment transferred or terminated under the new ownership. Customers relying on NaturalShrimp's proprietary shrimp production technology will need to seek alternative suppliers. The broader market for sustainable aquaculture may view this as a cautionary tale regarding the challenges of scaling innovative but capital-intensive technologies, potentially impacting investor confidence in similar ventures and intensifying competitive pressures among remaining players.

Risk Assessment

Risk Level: high — The risk level is high due to the company entering receivership on September 9, 2024, and the subsequent court approval on March 30, 2025, to sell substantially all assets to Streeterville Capital, LLC and Bucktown Capital, LLC for a credit bid of approximately $35.7 million and $100,000 in cash. This indicates that liquidation is imminent, and the company plans to present its financial statements under the liquidation basis of accounting as of March 31, 2025, making recovery for common stockholders highly unlikely.

Analyst Insight

Investors should immediately recognize the high probability of total loss for their NaturalShrimp Inc. common stock. Given the court-approved asset sale and impending liquidation, selling shares, if possible, to realize any remaining value or using the loss for tax purposes is advisable.

Financial Highlights

debt To Equity

N/A

revenue

$163,492

operating Margin

N/A

total Assets

N/A

total Debt

N/A

net Income

-$6,285,201

eps

N/A

gross Margin

N/A

cash Position

$20,981

revenue Growth

-55.2%

Key Numbers

• $163,492 — Sales (Decreased by 55.2% for the nine months ended December 31, 2024, compared to $365,184 in 2023.)
• $6,285,201 — Net Loss (Net loss for the nine months ended December 31, 2024, improved by 39.2% from $10,347,034 in 2023.)
• $20,981 — Cash (Significantly reduced from $115,525 at March 31, 2024, indicating severe liquidity issues.)
• $41,122,005 — Total Current Liabilities (Increased from $38,528,534 at March 31, 2024, driven by restructured debt.)
• $27,600,000 — Restructured Senior Note Payable (Major component of current liabilities as of December 31, 2024.)
• 1,277,546,746 — Common Shares Outstanding (Increased from 1,116,482,063 at March 31, 2024, due to financing agreements.)
• $35.7 million — Asset Sale Credit Bid (Approximate value of the credit bid for substantially all company assets.)
• September 9, 2024 — Receivership Date (Date Amplo Turnaround and Restructuring, LLC was appointed receiver.)

Key Players & Entities

• NaturalShrimp Inc. (company) — registrant and subject of receivership
• Streeterville Capital, LLC (company) — lender and primary purchaser of assets
• Bucktown Capital, LLC (company) — lender and primary purchaser of assets
• Amplo Turnaround and Restructuring, LLC (company) — court-appointed receiver
• $163,492 (dollar_amount) — total sales for the nine months ended December 31, 2024
• $6,285,201 (dollar_amount) — net loss attributable to NaturalShrimp Inc. for the nine months ended December 31, 2024
• $20,981 (dollar_amount) — cash balance as of December 31, 2024
• $41,122,005 (dollar_amount) — total current liabilities as of December 31, 2024
• $35.7 million (dollar_amount) — approximate credit bid for asset sale
• March 30, 2025 (date) — date court approved asset sale

FAQ

Risk Factors

• Inability to Meet Financial Obligations [high — financial]: The company has experienced a significant decline in sales and a widening net loss, leading to severe liquidity issues. Cash decreased from $115,525 to $20,981, and total current liabilities increased to $41,122,005. This precarious financial state culminated in receivership on September 9, 2024.
• Receivership and Asset Sale [high — legal]: The company entered receivership on September 9, 2024, with a motion approved on March 30, 2025, to sell substantially all assets for approximately $35.7 million in credit bid and $100,000 in cash. This indicates an imminent liquidation and a loss for equity holders.
• Substantial Debt Load [high — financial]: Total current liabilities surged to $41,122,005, significantly driven by restructured debt including a Senior note payable of $27,600,000 and an August note payable of $2,790,000. This high debt burden exacerbates financial distress.
• Deteriorating Operational Performance [high — operational]: Sales for the nine months ended December 31, 2024, decreased by 55.2% to $163,492 compared to $365,184 in the prior year period. This sharp decline in revenue indicates significant operational challenges.
• Dilution from Equity Issuances [medium — financial]: Common shares outstanding increased from 1,116,482,063 at March 31, 2024, to 1,277,546,746 by December 31, 2024, likely due to financing agreements. This substantial increase in shares outstanding can lead to significant dilution for existing shareholders.

Industry Context

The shrimp aquaculture industry faces challenges related to disease, environmental sustainability, and market price volatility. Companies like NaturalShrimp operate in a competitive landscape where efficient production and cost management are crucial for profitability. Recent trends indicate a growing demand for sustainably farmed seafood, but operational execution remains a key differentiator.

Regulatory Implications

The company's receivership and impending asset sale suggest significant financial distress, which could attract scrutiny from regulatory bodies regarding past disclosures and financial reporting. Compliance with bankruptcy and asset disposition regulations will be paramount.

What Investors Should Do

1. Review the terms of the asset sale to Streeterville Capital, LLC and Bucktown Capital, LLC.
2. Assess the impact of the significant increase in common shares outstanding.
3. Monitor any further filings related to the receivership and liquidation process.

Key Dates

• 2024-09-09: Company entered receivership — Marks the formal appointment of a receiver, indicating severe financial distress and a loss of control by management.
• 2025-03-30: Motion to sell substantially all assets approved — Signals an imminent liquidation of the company's core assets, likely resulting in a loss for equity holders.
• 2024-12-31: Nine months ended period for financial reporting — Period during which sales declined 55.2% and net loss widened, highlighting deteriorating performance.
• 2024-03-31: Prior period balance sheet date — Provides a comparison point for the significant deterioration in cash and increase in liabilities by December 31, 2024.

Glossary

Receivership

A legal process where a court appoints a receiver to take control of a company's assets and operations, typically due to insolvency or financial distress. (NaturalShrimp Inc. entered receivership on September 9, 2024, indicating a critical financial situation and impending liquidation.)

Credit Bid

A bid made by a creditor in an asset sale that uses the debt owed to them as payment, rather than cash. (The proposed asset sale involves a $35.7 million credit bid, meaning the buyers are essentially using the company's debt to acquire its assets.)

Current Liabilities

Obligations that are expected to be settled within one year or the operating cycle, whichever is longer. (The company's current liabilities surged to $41,122,005, driven by restructured debt, highlighting its short-term financial strain.)

Net Loss Attributable to NaturalShrimp Inc.

The total losses incurred by the company after all expenses, interest, and taxes, belonging to its common shareholders. (The net loss for the nine months ended December 31, 2024, was $6,285,201, showing significant ongoing financial underperformance.)

Year-Over-Year Comparison

Compared to the prior year period, NaturalShrimp Inc. has experienced a severe downturn. Revenue has plummeted by 55.2%, indicating a significant operational contraction. While the net loss has improved by 39.2% to $6,285,201, this is against a backdrop of a drastically shrinking revenue base and severe liquidity constraints, with cash reserves falling to $20,981. The company's financial position has deteriorated, marked by an increase in total current liabilities to $41,122,005, largely due to restructured debt, and ultimately leading to receivership.

Filing Documents

• form10-q.htm (10-Q) — 1167KB
• ex31-1.htm (EX-31.1) — 18KB
• ex31-2.htm (EX-31.2) — 17KB
• ex32-1.htm (EX-32.1) — 8KB
• ex32-2.htm (EX-32.2) — 8KB
• 0001641172-25-027039.txt ( ) — 5960KB
• shmp-20241231.xsd (EX-101.SCH) — 37KB
• shmp-20241231_cal.xml (EX-101.CAL) — 67KB
• shmp-20241231_def.xml (EX-101.DEF) — 234KB
• shmp-20241231_lab.xml (EX-101.LAB) — 364KB
• shmp-20241231_pre.xml (EX-101.PRE) — 295KB
• form10-q_htm.xml (XML) — 804KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION 3 ITEM 1.

Financial Statements

Financial Statements 3 Condensed Consolidated Balance Sheets as of December 31, 2024 (unaudited) and March 31, 2024 3 Condensed Consolidated Statements of Operations for the Three and Nine Months Ended December 31, 2024 and 2023 (unaudited) 4 Condensed Consolidated Statements of Changes in Stockholders' Deficit for the Three and Nine Months Ended December 31, 2024 and 2023 (unaudited) 5 Condensed Consolidated Statements of Cash Flows for the Nine Months Ended December 31, 2024 and 2023 (unaudited) 6 Notes to Condensed Consolidated Financial Statements (unaudited) 7 ITEM 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 25 ITEM 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 31 ITEM 4.

Controls and Procedures

Controls and Procedures 32

OTHER INFORMATION

PART II. OTHER INFORMATION 33 ITEM 1.

Legal Proceedings

Legal Proceedings 33 ITEM 1A.

Risk Factors

Risk Factors 33 ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds 33 ITEM 3. Defaults Upon Senior Securities 33 ITEM 4. Mine Safety Disclosures 33 ITEM 5. Other Information 33 ITEM 6. Exhibits 34

SIGNATURES

SIGNATURES 35 2 PART I – FINANCIAL INFORMATION Item 1. Financial Statements NATURALSHRIMP INCORPORATED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS AS OF December 31, 2024 March 31, 2024 ASSETS Current assets Cash $ 20,981 $ 115,525 Accounts receivable 44,053 27,450 Escrow account - - Inventory 34,111 68,510 Prepaid expenses 162,722 169,650 Deferred offering costs - - Total current assets 261,867 381,135 Fixed assets, net 11,848,915 13,301,245 Other assets Intercompany - - Construction-in-process - - Patents, net 5,586,000 5,878,500 License Agreement, net 7,252,376 8,062,376 Right of Use asset 65,830 73,449 Deposits 20,500 20,633 Total other assets 12,924,706 14,034,958 Total assets $ 25,035,488 $ 27,717,338 LIABILITIES, MEZZANINE AND STOCKHOLDERS' DEFICIT Current liabilities Accounts payable $ 3,974,099 $ 3,495,689 Accrued interest 125,844 107,435 Accrued interest - related parties 285,839 254,593 Accrued interest 285,839 254,593 Other accrued expenses 1,746,820 1,743,799 Accrued expenses - related parties 1,602,140 1,116,107 Contract liability - - Short-term Note and Lines of credit 818,901 19,817 Notes payable 460,622 553,322 Restructured Senior note payable 27,600,000 27,120,000 Restructured August note payable 2,790,000 2,640,000 Notes payable - related parties 920,412 880,412 Notes payable 920,412 880,412 Dividends payable 768,768 544,800 Derivative liability - - Warrant liability - 24,000 Lease Liability, current 28,560 28,560 Total current liabilities 41,122,005 38,528,534 Lease Liability, non-current 26,482 43,325 Total liabilities 41,148,487 38,571,859 Commitments and contingencies (Note 11) - - Series E Redeemable Convertible Preferred stock, $ 0.0001 par value, 10,000 shares authorized, 1,571 and 1,670 shares issued and outstanding at December 31, 2024 and March 31, 2024, respectiv

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