Heritage Foods Limited (HERITGFOOD) AI Stock Analysis

• Market Cap: ₹33.33B
• Dividend Yield: 0.54%
• Average Volume (3M): 58.61K
• Price to Earnings (P/E): 20.3
• Beta (1Y): 2.07
• Revenue Growth: 9.83%
• EPS Growth: -0.92%
• Country: IN
• Employees: 3,225
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Packaged Foods
• EPS (TTM): 3.73
• Shares Outstanding: 92,796,000
• 10 Day Avg. Volume: 17,779
• 30 Day Avg. Volume: 58,609
• PEG Ratio: 0.25
• Price to Book (P/B): 3.76
• Price to Sales (P/S): 0.88
• P/FCF Ratio: 97.61
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ₹475.00
• Price Target Upside: 2.17% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 58 Neutral
• Price Target: ₹377.00 ▼(-18.91% Downside)

The score is primarily supported by improving profitability and a low-leverage balance sheet, but is meaningfully offset by weak free cash flow and very bearish technicals (price below all key DMAs with negative MACD). Valuation is neutral, with a moderate P/E and low dividend yield offering limited downside cushion.

Positive Factors

Consistent revenue and margin improvement

Sustained revenue growth alongside rising gross and net margins indicates operational improvement and stronger pricing or mix. Over 2-6 months this supports reinvestment in product lines, strengthens competitiveness in branded dairy, and improves resilience to input cost swings.

Low financial leverage

A low debt-to-equity ratio and strong equity base provide financial flexibility to fund capex, expand cold-chain and distribution, and absorb dairy cyclicality. Healthy ROE shows efficient capital use, reducing refinancing risk and supporting long-term strategic investments.

Established procurement and cold-chain distribution

A stable milk procurement network and cold-chain/distribution infrastructure create a durable supply advantage, enabling consistent raw input quality and scale for value-added products. This structural strength supports margin sustainability and regional market penetration.

Negative Factors

Volatile and weak free cash flow

Heavy capital spending driving a recent free cash flow decline weakens liquidity and the company’s ability to self-fund growth or returns. If capex remains elevated, cash conversion risk persists, potentially forcing external financing or slowing strategic investments.

Negative EPS growth

A double-digit decline in EPS signals underlying earnings pressure that can reflect margin headwinds or rising costs. Persisting negative EPS growth reduces internally available capital for capex or brand expansion and may constrain long-term shareholder return prospects.

Rising total liabilities concern

Although leverage is currently low, a trend of rising total liabilities could erode balance sheet strength over time, increasing fixed obligations and liquidity risk. Continued increases would limit strategic flexibility and raise sensitivity to cash flow volatility.

Heritage Foods Limited Business Overview & Revenue Model

Company Description

Heritage Foods Limited procures and processes milk and milk products in India. The company operates through Dairy, Renewable Energy, and Feed segment. The Dairy segment produces and markets dairy products, including fresh milk, curd, butter milk, lassi, ice cream, paneer, cooking butter, table butter, flavored milk, UHT milk, sweets, ghee, cheese, cold coffee, cream, skimmed milk powder, frozen desserts, and milk shake. This division also operates and franchises 859 Heritage Parlour outlets. In addition, it exports dairy products to Europe, the Gulf countries, and various countries in Asia. The Renewable Energy segment operates a solar power plant with a capacity of 4.20 MW; and wind power plant with a capacity of 6.30 MW in the states of Andhra Pradesh, Telangana, Maharashtra, Tamil Nadu, and Karnataka. The Feed segment manufactures and sells cattle feeds. The company was formerly known as Heritage Foods (India) Limited and changed its name to Heritage Foods Limited in August 2013. Heritage Foods Limited was incorporated in 1992 and is headquartered in Hyderabad, India.

How the Company Makes Money

Heritage Foods Limited generates revenue primarily through the sale of its dairy products, which constitute a significant portion of its portfolio. The company also earns income from its poultry operations and processed food items. Key revenue streams include retail sales in supermarkets and grocery stores, direct-to-consumer sales through online platforms, and distribution agreements with food service providers. Additionally, Heritage Foods has established strategic partnerships with local farmers for sourcing raw materials, ensuring quality control and sustainability. The company's focus on brand loyalty, product innovation, and expanding its market presence both domestically and internationally further contributes to its earnings.

Heritage Foods Limited Financial Statement Overview

Summary

Income statement strength (Score 78) shows consistent revenue growth and improving profitability margins, while the balance sheet is solid with low leverage (debt-to-equity ~0.18; Score 70). The main drag is cash flow (Score 60) due to volatile and recently weaker free cash flow from heavy capex, which raises liquidity/quality-of-earnings risk.

Income Statement

Heritage Foods Limited has demonstrated consistent revenue growth over the years, with a notable increase in gross profit and net income margins. The gross profit margin has risen to approximately 25.0%, and the net profit margin has improved to about 4.6% in the most recent fiscal year. The company also shows a positive trend in EBIT and EBITDA margins, indicating operational efficiency improvements. However, fluctuations in EBIT in earlier years suggest some past operational challenges.

Balance Sheet

The company maintains a healthy balance sheet, with a debt-to-equity ratio of 0.18, indicating low leverage and financial stability. The equity ratio stands at around 62.4%, reflecting strong equity financing. Return on equity (ROE) has improved to approximately 19.4%, showcasing effective utilization of shareholders' equity. Nonetheless, there is a slight concern over the increase in total liabilities in recent years.

Cash Flow

Heritage Foods has experienced volatility in free cash flow, with a significant drop in the most recent year. The operating cash flow to net income ratio is robust at 1.14, indicating good cash generation from operations relative to net income. However, the free cash flow to net income ratio is relatively low, reflecting heavy capital expenditures impacting free cash flow. This could pose liquidity challenges if capital spending continues to outpace cash generation.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	42.39B	41.35B	37.94B	32.41B	26.79B	24.73B
Gross Profit	9.45B	5.41B	4.68B	6.25B	5.72B	6.14B
EBITDA	3.27B	3.32B	2.14B	1.52B	1.86B	2.71B
Net Income	1.70B	1.88B	1.07B	579.76M	965.69M	1.50B
Balance Sheet
Total Assets	0.00	15.58B	12.81B	11.25B	9.03B	8.79B
Cash, Cash Equivalents and Short-Term Investments	2.59B	2.56B	2.10B	247.15M	351.01M	227.88M
Total Debt	0.00	1.74B	1.32B	1.68B	192.52M	684.20M
Total Liabilities	-9.72B	5.86B	4.73B	3.99B	2.45B	2.82B
Stockholders Equity	9.72B	9.72B	8.08B	7.26B	6.58B	5.96B
Cash Flow
Free Cash Flow	0.00	374.81M	2.63B	-1.44B	1.01B	813.24M
Operating Cash Flow	0.00	2.14B	3.90B	-605.05M	1.48B	1.74B
Investing Cash Flow	0.00	-2.29B	-2.52B	-826.24M	-424.45M	688.03M
Financing Cash Flow	0.00	9.98M	-759.30M	1.26B	-926.55M	-1.91B

Heritage Foods Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 464.90
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:HERITGFOOD, the sentiment is Negative. The current price of 464.9 is above the 20-day moving average (MA) of 425.26, above the 50-day MA of 449.57, and above the 200-day MA of 459.19, indicating a bearish trend. The MACD of -22.23 indicates Positive momentum. The RSI at 14.67 is Positive, neither overbought nor oversold. The STOCH value of 9.15 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:HERITGFOOD.

Heritage Foods Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TATACONSUM	71 Outperform	₹1.12T	76.43	―	0.70%	15.34%	14.67%
VADILALIND	68 Neutral	₹31.43B	23.40	―	0.42%	11.81%	-12.36%
PARAGMILK	65 Neutral	₹31.57B	22.58	―	0.33%	13.73%	32.07%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
HATSUN	61 Neutral	₹195.61B	56.16	―	0.61%	10.61%	7.97%
HERITGFOOD	58 Neutral	₹33.33B	20.27	―	0.54%	9.83%	-0.92%

Heritage Foods Limited Corporate Events

Heritage Foods Executes Share Purchase Agreement for 51% Stake in Peanutbutter and Jelly Pvt Ltd

Heritage Foods Limited has executed a Share Purchase Agreement to acquire 51% of the equity share capital of Peanutbutter and Jelly Private Limited from Sky Gate Hospitality Private Limited, formalising a previously announced transaction. The share transfer process under this agreement is now underway, with the company stating it will notify the stock exchanges upon completion, signaling a strategic move to deepen its footprint in the packaged foods segment and potentially broaden its product offerings and market reach.

Heritage Foods Secures GST Refund in Favorable Ruling

Heritage Foods Limited announced a favorable decision from the Joint Commissioner of Central Tax, Chennai, regarding a refund of GST paid under protest on flavored milk supplies in Tamil Nadu. The company will receive a refund of Rs. 77.95 lakhs, which positively impacts its financials and resolves previous disputes over GST payments, enhancing its operational efficiency.