Heritage Foods Faces Profit Drop Despite Revenue Growth

• Heritage Foods reports decline in quarterly profits
• Revenue growth impacted by rising dairy expenses
• Heritage shares remain under market pressure

Heritage Foods posted a mixed performance in its fourth quarter results as the company recorded revenue growth while profits declined sharply due to increasing operational costs and pressure in the dairy sector.

According to the company’s latest financial report, total revenue for the quarter stood at Rs 1157.56 crore, registering nearly 10 percent growth compared to the same period last year. However, net profit dropped from Rs 38.16 crore to Rs 23.94 crore during the quarter.

Company officials attributed the decline in profitability mainly to rising milk procurement costs, adverse weather conditions and milk shortages reported in several parts of the country. Executive Director Nara Brahmani said these challenges significantly affected the dairy industry and increased pressure on operating margins.

The company’s total expenditure rose sharply from around Rs 990 crore to Rs 1132 crore, which impacted overall earnings despite growth in sales. Analysts believe stabilisation in milk procurement prices and favourable weather conditions could improve margins in the coming quarters.

In the stock market, Heritage Foods shares have witnessed fluctuations in recent months. Ahead of the quarterly results announcement, the stock closed at Rs 378.30 with gains of over 4 percent in a single trading session. However, the stock remains significantly below its all time high levels.

During the 2024 election results period, Heritage shares had touched a record high of Rs 727. Since then, the stock has lost a major portion of its market value and declined nearly 20 percent in the last six months alone. The company’s current market capitalisation stands at around Rs 3510 crore.

Despite recent setbacks, the management remains optimistic about future growth. Heritage Foods recently launched a new ice cream manufacturing plant at Shamirpet and is focusing on expanding value added dairy products including curd, paneer, ghee and flavoured milk.

Founded in 1992 by current Andhra Pradesh Chief Minister N. Chandrababu Naidu, the company now operates under the supervision of family members including Vice Chairperson Nara Bhuvaneswari and Executive Director Nara Brahmani. Heritage Foods has expanded its business operations across Telangana, Andhra Pradesh, Karnataka, Tamil Nadu, Maharashtra and Delhi.