Around 25% of walnut kernels are damaged during the extraction of kernel from the shell. This results in the production of a large quantity of broken walnut kernels which is estimated to be around 0.4 lakh tonnes out of 1.56 lakh tonnes of walnut kernels produced in Jammu and Kashmir annually. This results in huge losses to the producers as broken walnut kernels sell at a much lesser price and therefore, it necessitates adoption of measures to reduce these losses. Value addition of broken walnut kernels by the development of walnut butter with nutraceutical properties is a promising approach to boost the economy. In the present study, roasted broken walnut kernels were used for the development of walnut butter. Natural emulsifier was added into the product to improve the stability of the emulsion. If all of the broken walnut kernels are processed into butter, it is expected to produce 36,800 MT of walnut butter annually which will generate a total revenue of INR 3680 crore. The B:C ratio of this venture is 1.62 which is undeniably profitable.