Milk sales, procurement drive Heritage Foods to highest-ever Q1 revenue

Hyderabad: Heritage Foods Limited, a leading Indian dairy brand, reported its highest-ever quarterly revenue of Rs11,368 million for the first quarter of FY26, registering a 10% year-on-year growth despite headwinds from unseasonal rainfall across its key markets.

The company, which is celebrating 34 years of operations, attributed its strong performance to steady progress in milk procurement, resilient milk and value-added product (VAP) sales, and its continued focus on quality, innovation, and farmer empowerment. Heritage also unveiled its “Vision 2030” strategy to become India’s most admired dairy nutrition brand.

During the quarter ended June 30, 2025, milk procurement increased 9.9% YoY to 17.8 lakh litres per day, while milk sales rose 2.8% to 11.6 lakh litres per day. Average milk selling prices also improved by 2.9% to Rs56.4 per litre.

Although the early arrival of monsoon rains in April and May muted demand for VAPs like curd, buttermilk, and ice cream—resulting in a slight drop in VAP contribution to overall revenue from 37.5% to 36.1%—the segment recovered in June, with Q1 VAP sales rising 5.5% YoY to Rs4,034 million.

Including Ghee and Butter, total VAP revenue reached Rs4,540 million, up 7.4% YoY, contributing 40.6% to total revenue.

The company also saw cost pressures, as raw milk prices increased by 4.74% YoY. Blended revenue per kg rose by 4.1%, but a lower VAP mix and selective pricing strategies caused margin compression, with EBITDA dropping 21% YoY to Rs739 million and profit after tax (PAT) falling 31% to Rs405 million.

Strategically, the board approved increasing its stake in Heritage Novandie Foods Pvt Ltd (HNFPL) to 94.4%, enhancing control over the yogurt supply chain. Capital investments in an upcoming greenfield ice cream facility and other VAP projects are expected to accelerate growth in the coming quarters.

Subsidiary Heritage Nutrivet Limited posted standout results, with revenue rising 26% YoY to Rs533 million and profit before tax jumping 130% to Rs67 million.

The company also rolled out a 360° marketing campaign and launched a refreshed range of Heritage Livo flavored milk and high-protein yogurts, targeting health-conscious consumers. Additionally, Heritage was recognized among ‘India’s Best Workplaces in FMCG’ by the Great Place to Work Institute.

Executive Director Brahmani Nara expressed confidence in the company’s trajectory: “This quarter’s performance, despite inclement weather, reflects the strength of our brand portfolio and robust procurement system. With rising consumer loyalty, expanding networks, and innovation-led momentum, we are poised for strong growth in the rest of FY26.”

Heritage Foods will host an earnings call on July 18, 2025, at 11:00 AM IST to discuss results. Details are available on the company website.