HERITAGE FOOD 2023-24 Annual Report Analysis

FINANCIAL STATEMENT ANALYSIS

Financial Statement Analysis

Financial statement analysis is the process of evaluating a company’s financial health and
performance by reviewing its financial statements, including the income statement, balance
sheet, and cash flow statement.

This analysis involves using various metrics and methods to assess profitability, liquidity,
solvency, and efficiency, helping stakeholders make informed decisions about the financial
status of a company.

Importance Financial Statements

Financial statement analysis offers a clear and comprehensive view of a company’s financial
health for both internal stakeholders, such as the finance team and business leaders, and
external stakeholders, such as investors. This analysis helps stakeholders identify key insights
into a company’s performance. It also keeps finance professionals, and investors informed
about business and market trends, enabling better decision-making.

In addition, evaluating key financial ratios such as profitability, liquidity, and solvency helps
finance teams and business leaders assess resource management and progress toward
financial goals. Investors also use ratio analysis to gauge a company’s financial health and
growth potential for informed investment decisions.

The benefits of performing financial statement analysis include:

1. Informed Decision Making: Financial statement analysis provides necessary insights

to business leaders for making strategic decisions, such as expanding operations,
investing in new projects, or cutting costs.

2. Performance Evaluation: Company leadership and investors can track the business’s
financial performance over time, identifying strengths and areas for improvement.

3. Risk Management: By understanding financial vulnerabilities, company leadership

can take proactive steps to mitigate risks, such as cash flow issues or excessive debt.
 4. Investor Confidence: Detailed financial analysis helps attract and retain investors by
demonstrating transparency and the company’s ability to generate returns.

5. Regulatory Compliance: Regular financial analysis and reporting ensures that

businesses meet legal and regulatory requirements, reducing the risk of penalties,
fines, or reputational damage.

Annual Report

An annual report is a document that public corporations must provide annually

to shareholders that describes their operations and financial conditions. The report chronicles
the company's activities over the past year, may make forecasts about the future, and contains
detailed financial and operational information.

Balance Sheet

The term balance sheet refers to a financial statement that reports a company's assets,
liabilities, and shareholder equity at a specific point in time. Balance sheets provide the basis
for computing rates of return for investors and evaluating a company's capital structure.

In short, the balance sheet is a financial statement that provides a snapshot of what a
company owns and owes, as well as the amount invested by shareholders. Balance sheets can
be used with other important financial statements to conduct fundamental analysis or
calculate financial ratios.
Income Statement

The Income Statement is one of a company’s core financial statements that shows their profit
and loss over a period of time. The profit or loss is determined by taking all revenues and
subtracting all expenses from both operating and non-operating activities.

The income statement is one of three statements used in both corporate finance
(including financial modelling) and accounting. The statement displays the company’s
revenue, costs, gross profit, selling and administrative expenses, other expenses and income,
taxes paid, and net profit in a coherent and logical manner.

The statement is divided into time periods that logically follow the company’s operations.
The most common periodic division is monthly (for internal reporting), although certain
companies may use a thirteen-period cycle. These periodic statements are aggregated into
total values for quarterly and annual results.

This statement is a great place to begin a financial model, as it requires the least amount of
information from the balance sheet and cash flow statement. Thus, in terms of information,
the income statement is a predecessor to the other two core statements.
Cash Flow Statement

A cash flow statement is a financial statement that provides aggregate data regarding all cash
inflows that a company receives from its ongoing operations and external investment sources.
It also includes all cash outflows that pay for business activities and investments during a
given period.

The cash flow statement is believed to be the most intuitive of all the financial statements
because it follows the cash made by the business in three main ways:

 Operating activities: These include revenue and expenses derived from regular
goods and services.

 Investment activities: These involve purchasing or selling assets—anything from

real estate to patents—using free cash, not debt. They include both gains and losses.

 Financing activities: These involve debt and equity financing.

Ratio analysis

Ratio analysis is a tool that examines a company's financial health by analysing different
types of ratios. These ratios can help investors predict a company's future performance and
earnings.

Types of ratio analysis

 Liquidity ratios

Measure a company's ability to pay off short-term debts. Examples include current and quick
ratios.

 Profitability ratios

Measure a company's ability to generate profits. Examples include gross profit margin,
operating profit margin, and return on equity (ROE).

 Solvency ratios

Measure a company's ability to pay off long-term debts. Examples include debt-to-equity
ratio, debt-to-assets ratio, and interest coverage ratio.

 Efficiency ratios

Measure how well a company uses its assets and liabilities to increase sales and
profits. Examples include inventory turnover and turnover ratios.

 Valuation ratios

Measure a company's intrinsic value or owners' equity in relation to other financial

metrics. Investors use these ratios to predict a company's future performance.
FMCG - FAST MOVING CONSUMER GOODS

Introduction

The FMCG sector in India expanded due to consumer-driven growth and higher product
prices, especially for essential goods. FMCG sector provides employment to around 3 million
people accounting for approximately 5% of the total factory employment in India. FMCG
sales in the country grew 7-9% by revenues in 2022-23. The key growth drivers for the sector
include favourable Government initiatives & policies, a growing rural market and youth
population, new branded products, and growth of e-commerce platforms. Resilience needs to
be the key factor in the manufacturing process, daily operations, retail and logistic channels,
consumer insights and communication that will help FMCG companies to withstand the test
of time and create more value for consumers in the long run. India’s Fast-Moving Consumer
Goods (FMCG) sector grew 7.5% by volumes in the April-June 2023 quarter, the highest in
the last eight quarters, led by a revival in rural India and higher growth in modern trade.

CRISIL forecasts 7-9% revenue growth for the FMCG sector in the current FY25, driven by
increased volume and rural demand recovery. Fast-moving Consumer Goods (FMCG) sector
is India’s fourth-largest sector and has been expanding at a healthy rate over the years
because of rising disposable income, a rising youth population, and rising brand awareness
among consumers.

With household and personal care accounting for 50% of FMCG sales in India, the industry is
an important contributor to India’s GDP.
India is a country that no FMCG player can afford to ignore due to its middle-class
population which is larger than the total population of USA. The Indian FMCG market
continues to rise as more people start to move up the economic ladder and the benefits of
economic progress become accessible to the public. More crucially, with a median age of just
27, India's population is becoming more consumerist due to rising ambitions.

Market Size

Total revenue of FMCG market is expected to grow at a CAGR of 27.9% through 2021-27,
reaching nearly US$ 615.87 billion. In 2022, urban segment contributed 65% whereas rural
India contributed more than 35% to the overall annual FMCG sales. Good harvest,
government spending expected to aid rural demand recovery in FY24. The sector had grown
8.5% in revenues and 2.5% in volumes last fiscal year. In the January-June period of 2022,
the sector witnessed value growth of about 8.4% on account of price hikes due to inflationary
pressures. In third quarter of FY23, the FMCG sector clocked a value growth of 9.0% YoY —
lower than the 9.2% YoY value growth seen in third quarter of FY22.
The Union government approved a new PLI scheme for the food processing sector, with a
budget outlay of Rs. 109 billion (US$ 1.46 billion). Incentives under the scheme will be
disbursed for six years to 2026-27.

India’s FMCG sector has long been the top spender in the country’s advertising market,
commanding nearly one third share Rs. 31,000 Crore (US$ 3.75 billion) in 2023 of the total
advertising expenditure.

India includes 780 million internet users, where an average Indian person spends around 7.3
hours per day on their smartphone, one of the highest in the world. Number of active internet
users in India will increase to 900 million by 2025 from 759 million in 2022.

Government Initiatives

Some of the major initiatives taken by the Government to promote the FMCG sector in India
are as follows:

 The Union government approved a new PLI scheme for the food processing sector,
with a budget outlay of Rs. 109 billion (US$ 1.46 billion). Incentives under the
scheme will be disbursed for six years to 2026-27.

 The government's initiative to promote millets for its health benefits would increase
the consumption and production of the millets in the nation. To support this, the
government declared that the Indian Institute of Millet Research in Hyderabad will
become a worldwide centre of excellence for the exchange of best practices,
knowledge, and innovations.

 In 2022, Government announced that the food processing industry has invested Rs.
4,900 crore (US$ 593 million) so far under the PLI scheme, which was approved in
March 2021, with a budget outlay of Rs. 10,900 crore (US$ 1.3 billion), likely to
increase sales and exports of food products.

 A total of 182 applications have been approved under the PLI scheme for the food
processing industry. This includes 30 applications for millets-based products under the
PLI scheme (8 large entities and 22 SMEs).

 In 2022, a total of 112 food processing projects were completed and operationalized,
leveraging the private investment of Rs. 706.04 crore (US$ 85.4 million) and
generating direct and indirect employment for 25,293 people.
  To boost the food processing sector, the Centre has permitted under the Income Tax
Act a deduction of 100% of profit for five years and 25% of profit in the next five
years in case of new ago-processing industries set up to package and preserve fruits
and vegetables.

 Excise Duty of 16% on dairy machinery has been fully waived off and excise duty on
meat, poultry and fish products has been reduced from 16% to 8%.

 An amount of Rs. 1,000 crore (US$ 120.7 million) is being set up initially in NITI
Aayog for SETU for setting up of incubation centres and enhance skill development
to facilitate the startup ecosystem in the country while improving the ease of doing
business.

 The governments’ incentives and the FDI funds have helped the FMCG sector
strengthen employment, establish a more robust supply chain, and capture high
visibility for FMCG brands across established retail markets.

Road Ahead

Rural consumption has increased, led by a combination of increasing income and higher
aspiration levels. There is an increased demand for branded products in rural India. On the
other hand, with the share of the unorganised market in the FMCG sector falling, the
organised sector growth is expected to rise with an increased level of brand consciousness,
augmented by the growth in modern retail. Another major factor propelling the demand for
food services in India is the growing youth population, primarily in urban regions. India has a
large base of young consumers who form most of the workforce, and due to time constraints,
barely get time for cooking.

Online portals are expected to play a key role for companies trying to enter the hinterlands.
The Internet has contributed in a big way, facilitating a cheaper and more convenient mode to
increase a company’s reach. The number of internet users in India is likely to reach 1 billion
by 2025. It is estimated that 40% of all FMCG consumption in India will be made online by
2030. E-commerce share of total FMCG sales is expected to increase by 11% by 2030. It is
estimated that India will gain US$ 15 billion a year by implementing GST. GST and
demonetisation are expected to drive demand, both in the rural and urban areas and economic
growth in a structured manner in the long term and improved the performance of companies
within the sector.
HERITAGE FOODS COMPANY PROFILE

Heritage Foods, established in 1992 by Nara Chandrababu Naidu, is one of India’s largest
dairy companies. The company operates in milk production, processing and retail, offering
products like milk, yogurt and ice cream. Heritage Foods has a strong presence across India,
focusing on quality and sustainability in dairy.

Heritage Foods has expanded its business model to include retail outlets, cold storage and
logistics for the dairy industry. The company serves millions of customers through its vast
distribution network and focuses on technology-driven operations, maintaining high-quality
standards. Its innovative approach has established it as a prominent name in the dairy
industry.

Key Milestones in Heritage Foods

Heritage Foods has achieved several milestones, including its initial public offering (IPO) in
1994, expansion into retail and integration of technology in operations. Over the years, the
company has built a vast distribution network and strengthened its position in the Indian dairy
market with a focus on quality and innovation.

The company’s introduction of advanced dairy processing technology has enabled it to

maintain high-quality standards. Additionally, its expansion into international markets and
partnership with leading retail chains has helped Heritage Foods increase its customer base.
These milestones demonstrate the company’s continued growth and leadership in the dairy in
mission

 To be a nationally recognized brand for fresh and healthy products

 To anticipate, understand and respond to our customers’ needs by creating high-

quality products and making them available through innovative and convenient
channels.
  To embrace the right technology to delight our customers.

 Advocating the balancing of economic, social and environmental aspects to create a

better tomorrow.

 Empowering the farmer community through our unique 'Relationship Farming Model’

Through more than over 22 million square feet of retail space & with over 60,000 employees,
we serve customers in more than 250 cities across the country. Most of all, we help India
shop, save and realize dreams and aspirations to live a better quality of life every day.

Vision

Delighting every home with fresh and healthy products and empowering the farmer.

Mission

 To be a nationally recognized brand for fresh and healthy products

 To anticipate, understand and respond to our customers’ needs by creating high-

quality products and making them available through innovative and convenient
channels.

 To embrace the right technology to delight our customers.

 Advocating the balancing of economic, social and environmental aspects to create a

better tomorrow.

 Empowering the farmer community through our unique 'Relationship Farming Model’

 Be the employer of choice by nurturing entrepreneurship and promoting

empowerment, alongside transparency.

Heritage Renewable Energy

We at Heritage have recognized our responsibilities to protect the environment. With this, we
are dedicated to expand our green footprint and thus we have started our clean energy journey
by entering into renewable energy projects for captive consumption.

We have commissioned 11.70 MW capacity of Renewable energy plants (Solar :5.40MW

Wind: 6.30MW) and distributing energy through our solar wind power plants at 16 different
locations namely 3 wind power plants at Vajra Karur, Gelugpa in Anantapur District, 14 Solar
plants at Bhattiprolu, Kaanapali, Bobbili, Piler and Gokul parlour in Andhra Pradesh.
Murugu, Kaller, Archetypally and Shamere in Telangana. Bangalore packing station in
Karnataka, Sangvi and Manor packing station in Maharashtra, Vad Madurai packing station
in Tamil Nadu and Rai Packing station in Haryana.

The captive power generated through above Renewable Energy plants is being consumed at
various dairy plants under green initiatives to reduce carbon emissions and protect the
environment.

Heritage Foods’s Business Segments

Heritage Foods operates in several key segments, including dairy production, processing and
retail. It offers a wide range of dairy products, such as milk, butter, yogurt, ice cream and
more. The company is also involved in the retail and distribution of its products through its
outlets and third-party retailers.

The company’s dairy segment is the most significant, where it processes and packages a
variety of milk and milk-based products. Heritage Foods also focuses on the retail market,
offering fresh dairy items to consumers. Its widespread presence ensures its products reach
millions across India, ensuring high growth potential.

Heritage Foods Limited is an Indian company that produces dairy products and other food
items. Their products include:

 Dairy: Milk, curd, paneer, butter, ghee, lassi, buttermilk, flavoured milk, and more

 Ice cream: Alpen vie Afghan Delight and Alpen vie Premium Butter Scotch

 Fresh fruits and vegetables: 177 varieties

 Bakery products: 150 varieties

 Private labels: Farmers' Pride cereals, pulses, staples, and spices

 Ghee: Golden Cow Ghee and Dander Ghee

 Cheese: Cheese slices

 Dairy drinks: Milkshakes

 Ghee Laddus: Sweet treats

Heritage Foods Stock Performance

Heritage Foods Ltd demonstrates significant financial growth in FY24 compared to FY23,
marked by increases in revenue, profitability and asset value. The company’s performance
highlights its robust operational strategies and financial stability across key metrics.

 Revenue Trend: Revenue rose to ₹3,794 crores in FY24 from ₹3,241 crores in
FY23, reflecting a 17.05% growth. Expenses increased to ₹3,584 crores in FY24
compared to ₹3,102 crores in FY23.

 Equity and Liabilities: Equity capital remained constant at ₹46.40 crores in FY24.
Reserves increased to ₹761.76 crores from ₹679.47 crores in FY23, while total
liabilities grew to ₹1,281 crores from ₹1,125 crores.

 Profitability: Operating profit improved to ₹209.54 crores in FY24 from ₹138.26

crores in FY23. OPM also increased to 5.51% in FY24 from 4.25%, showing
enhanced operational efficiency.

 Earnings per Share (EPS): EPS climbed to ₹11.48 in FY24, up from ₹6.25 in
FY23, signalling a strong recovery in earnings per share and shareholder value.

 Return on Net Worth (Row): With higher profitability and reserves, Row improved,
driven by a net profit increase to ₹106.55 crores in FY24 compared to ₹57.97 crores
in FY23.

 Financial Position: Total assets expanded to ₹1,281 crores in FY24 from ₹1,125
crores in FY23. Non-current assets rose to ₹756.12 crores and current assets
increased to ₹524.98 crores, reflecting better financial health.
Challenges Faced by Heritage Foods

Heritage Foods faces challenges such as increasing input costs, fluctuating milk prices and
competition in the dairy market. Additionally, the company must navigate the complexities of
maintaining supply chain efficiency and ensuring product quality amid rising consumer
demands and fluctuating raw material prices.

The dairy industry is subject to regulatory challenges, including government policies related
to milk pricing and quality standards. Moreover, competition from other dairy brands and
changing consumer preferences, such as a shift toward plant-based alternatives, presents a
challenge to Heritage Foods’ growth. The company must adapt to these trends while
maintaining profitability.

Benefits of heritage foods

 Reduced risk of heart disease: Heritage diets often limit saturated fat and emphasize
unsaturated fats, which can help lower cholesterol levels.

 Improved heart health: Heritage foods can include lean meats, fish, and seafood,
which are rich in omega-3 fatty acids and protein.

 Improved vision and disease resistance: Heritage foods can include foods rich in
vitamin A.

 Improved wound healing and infection resistance: Heritage foods can include
foods rich in zinc.

 Improved muscle and blood health: Heritage foods can include foods rich in iron.

 Improved energy levels: Cereal-based staple foods are a major source of energy for
the world population.

 Improved bone, muscle, and teeth health: Protective foods can help strengthen
bones, muscles, and teeth.

 Improved balance in the body: Protective foods can help maintain balance in the
body.
BRIEF PROFILE OF DRIECTORS

1.Mr. Angara Venkata Girija Kumar Chairperson, Non-Executive Independent Director

He is a B.COM, MBA, AIII and a Member of (the First) Financial Services Institutions
Bureau under Ministry of Finance (Appointed by Appointments Committee of the Cabinet,
Govt. of India. He was Former Chairman and Managing Director of Oriental Insurance Co.
Ltd and retired from service on 31st May 2020, upon attaining the age of superannuation and
held various positions concurrently at the time of superannuation. Presently, he is an
Independent Director on the Board of M/s. Royal Sundaram General Insurance Company
Limited.

2.Mr. Rajesh Thakur Ahuja Non-Executive Independent Director

Graduate in Production Engineering from Pune University Engineering College. Started

Silver line Wire Products in 1993 as a manufacturer of plastic-coated wire products for
household applications. In 1998, started marketing under the brand name of Sleek. He has
completed Owner President Management Programme at Harvard University, USA. Is also on
the board of several other companies. He is an expert in the areas of Strategy Planning and
Mergers & Acquisitions; Leadership; Sales & Marketing and Finance.

3.Mrs. Aparna Surabhi Non-Executive Independent Woman Director

Is a Fellow Member of Institute of Chartered Accountants of India, Bachelor of Commerce

from Bombay University, and Bachelor of Law from Bombay University and has been
practicing as a Chartered Accountant since 1991. She has more than 25 years of experience in
handling audits of all kinds and has been a consultant for many start-up businesses. She is
working as CFO & CHRO in Caliber Technologies Private Limited.

4.Mr. M P Vijay Kumar Non-Executive Independent Director

A Fellow Member of the Institute of Chartered Accountants of India (ICAI), the Institute of
Cost and Management Accountants of India (ICMA), and the Institute of Company
Secretaries of India (ICSI), with more than thirty years of experience. He also serves as a
Member on the IFRS Interpretation Committee of International Accounting Standards Board
and IFRS Advisory Council of the IFRS Foundation, London. He served as Council Member
of ICAI (2016 2022), was Chairman of Accounting Standards Board and Ex. Officio Member
of NFRA (2019-2022). He was a member of MCA, SEBI and the CFO Forum in the CII. He
was awarded the Business World CFO of the Year for 2021 and among the 100 most
influential CFOs in India by CIMA. He is working as an Executive Director and Group CFO
in Sify Technologies Limited.

5.Mrs. Bhuvaneswari Nara Vice-Chairperson & Managing Director

A B.A. Graduate and a Director for several companies. Is a dynamic leader who has extensive
experience in business and has been successfully steering Heritage Foods Limited towards
growth and better prospects. Joined Heritage in 1994 as whole-time Director and is now
serving as Vice Chairperson & Managing Director. Is guiding and monitoring the overall
workflow of the organization.

6.Mrs. Brahmani Nara Executive Director

Holds a Master's in Business Administration from Stanford University, Bachelor’s in

Electrical Engineering from Santa Clara University, California, USA and Communication
Engineering from Chaitanya Bharathi Institute of Technology, Hyderabad, India. Investment
Associate in Vertex Venture Management Pvt Ltd between 2009-2011 in Singapore. Joined
Heritage in 2011 as Vice President Business Development and is now serving as Executive
Director. Takes care of such vital functions as design, development and implementation of
strategic plans for the organization in a cost-effective and time-efficient manner.
HERITAGE FOOD 2023-24 Annual Report Analysis

HERITAGE FOOD has announced its results for the year ended March 2024. Let us have a
look at the detailed performance review of the company during FY23-24.

HERITAGE FOOD Income Statement Analysis

 Operating income during the year rose 17.1% on a year-on-year (YoY) basis.

 The company's operating profit increased by 54.6% YoY during the fiscal. Operating
profit margins witnessed a fall and down at 5.4% in FY24 as against 4.1% in FY23.

 Depreciation charges increased by 8.3% and finance costs increased by 64.9% YoY,
respectively.

 Other income declined by 0.8% YoY.

 Net profit for the year grew by 83.8% YoY.

 Net profit margins during the year grew from 1.8% in FY23 to 2.8% in FY24.

HERITAGE FOOD Income Statement 2023-24

No. of Months Year Ending 12 Mar-23* 12 Mar-24* % Change

Net Sales Rs m 32,407 37,939 17.1%

Other income Rs m 121 120 -0.8%

Total Revenues Rs m 32,527 38,059 17.0%

Gross profit Rs m 1,316 2,034 54.6%

Depreciation Rs m 561 608 8.3%

Interest Rs m 57 95 64.9%

Profit before tax Rs m 817 1,451 77.5%

Tax Rs m 238 385 62.1%

Profit after tax Rs m 580 1,065 83.8%

 Gross profit margin % 4.1 5.4

Effective tax rate % 29.1 26.6

Net profit margin % 1.8 2.8

HERITAGE FOOD Balance Sheet Analysis

 The company's current liabilities during FY24 down at Rs 3 billion as compared to Rs

3 billion in FY23, thereby witnessing a decrease of -2.4%.

 Long-term debt stood at Rs 751 million as compared to Rs 45 million during FY23, a

growth of 1571.4%.

 Current assets rose 16% and stood at Rs 5 billion, while fixed assets rose 13% and
stood at Rs 8 billion in FY24.

 Overall, the total assets and liabilities for FY24 stood at Rs 13 billion as against Rs 11
billion during FY23, thereby witnessing a growth of 14%.

HERITAGE FOOD Balance Sheet as on March 2024

No. of Months Year Ending 12 Mar-23* 12 Mar-24* % Change

Net worth Rs m 7,227 8,050 11.4

Current Liabilities Rs m 3,146 3,071 -2.4

Long-term Debt Rs m 45 751 1,571.4

Total Liabilities Rs m 11,250 12,811 13.9

 +

Current assets Rs m 4,533 5,250 15.8

Fixed Assets Rs m 6,717 7,561 12.6

Total Assets Rs m 11,250 12,811 13.9

HERITAGE FOOD Cash Flow Statement Analysis

 HERITAGE FOOD's cash flow from operating activities (CFO) during FY24 stood at
Rs 4 billion on a YoY basis.

 Cash flow from investing activities (CFI) during FY24 stood at Rs -3 billion, an
improvement of 204.7% on a YoY basis.

 Cash flow from financial activities (CFF) during FY24 stood at Rs -759 million on a
YoY basis.

 Overall, net cash flows for the company during FY24 stood at Rs 622 million from
the Rs -168 million net cash flows seen during FY23

HERITAGE FOOD Cash Flow Statement 2023-24

No. of
12 12
months %
Particulars
Year Mar- Mar- Change

Ending 23 24

Cash Flow from Operating

Rs m -605 3,899 -
Activities

Cash Flow from Investing

Rs m -826 -2,518 -
Activities

Cash Flow from Financing

Rs m 1,264 -759 -
Activities
Net Cash Flow Rs m -168 622 -
Current Valuations for HERITAGE FOOD

 The trailing twelve-month earnings per share (EPS) of the company stands at Rs 11.5,
an improvement from the EPS of Rs 6.2 recorded last year.

 The price to earnings (P/E) ratio, at the current price of Rs 568.1, stands at 34.1 times
its trailing twelve months earnings.

 The price to book value (P/BV) ratio at current price levels stands at 6.5 times, while
the price to sales ratio stands at 1.4 times.

 The company's price to cash flow (P/CF) ratio stood at 13.8 times its end-of-year
operating cash flow earnings.

Per Share Data/Valuations

No. of Months Year Ending 12 Mar-23* 12 Mar-24*

Sales per share (Unadd.) Rs 349.2 408.8

TTM Earnings per share Rs 6.2 11.5

Diluted earnings per share Rs 6.2 11.5

Price to Cash Flow x 11.7 13.8

TTM P/E ratio x 20.2 34.1

Price / Book Value ratio x 2.1 2.9

Market Cap Rs m 14,874 23,122

Dividends per share (Unadd.) Rs 2.5 2.5

Ratio Analysis for HERITAGE FOOD

 Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.7x during FY24, from
1.4x during FY23. The current ratio measures the company's ability to pay short-term and
long-term obligations.

Interest Coverage Ratio: The company's interest coverage ratio improved and stood at
16.3x during FY24, from 15.3x during FY23. The interest coverage ratio of a company states
how easily a company can pay its interest expense on outstanding debt. A higher ratio is
preferable.

 Profitability Ratios

Return on Equity (ROE): The ROE for the company improved and stood at 13.2% during
FY24, from 8.0% during FY24. The ROE measures the ability of a firm to generate profits
from its shareholders capital in the company.

Return on Capital Employed (ROCE): The ROCE for the company improved and stood at
17.6% during FY24, from 12.0% during FY23. The ROCE measures the ability of a firm to
generate profits from its total capital (shareholder capital plus debt capital) employed in the
company.

Return on Assets (ROA): The ROA of the company improved and stood at 9.1% during
FY24, from 5.7% during FY23. The ROA measures how efficiently the company uses its
assets to generate earnings.

Key Ratio Analysis

No. of MThs Year Ending 12 Mar-23* 12 Mar-24*

Current ratio x 1.4 1.7

Debtors’ Days Days 3 3

Interest coverage x 15.3 16.3

Debt to equity ratio x 0.0 0.1

 Return on assets % 5.7 9.1

Return on equity % 8.0 13.2

Return on capital employed % 12.0 17.6

HERITAGE FOOD Share Price Performance

Over the last one year, HERITAGE FOOD share price has moved up from Rs 264.9 to Rs
568.1, registering a gain of Rs 303.2 or around 114.5%.

Overall, the S&P BSE SENSEX is up 22.6% over the year.

What does the cash flow statement of HERITAGE FOOD reveal?

The cash flow statement is the financial statement that presents the cash inflows and
outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The
ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of HERITAGE FOOD reveals:

 Cash flow from operations increased in FY24 and stood at Rs 3,899 m as compared to
Rs -605 m in FY23.

 Cash flow from investments decreased in FY24 and stood at Rs -2,518 m as compared
to Rs -826 m in FY23.

 Cash flow from financial activity decreased in FY24 and stood at Rs -759 m as
compared to Rs 1,264 m in FY23.
Here's the cash flow statement of HERITAGE FOOD for the past 5 years.

(Rs m) FY20 FY21 FY22 FY23 FY24

From Operations 1,167 1,739 1,479 -605 3,899

From Investments -971 688 -424 -826 -2,518

From Financial Activity -217 -1,913 -927 1,264 -759

Net Cashflow -20 514 128 -168 622

What does the Key Ratio analysis of HERITAGE FOOD reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio

analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of HERITAGE FOOD reveals:

 Operating profit margins witnessed a fall and down at 5.4% in FY24 as against 4.1%
in FY23.

 Net profit margins grew from 1.8% in FY23 to 2.8% in FY24.

 Debt to Equity ratio for FY24 stood at 0.1 as compared to 0.0 in FY23.

Here's the ratio/financial analysis of HERITAGE FOOD for the past 5 years.

FY20 FY21 FY22 FY23 FY24

Operating Profit Margin (%) -14.0 10.6 6.6 4.1 5.4

Net Profit Margin (%) -6.2 6.0 3.6 1.8 2.8

Debt to Equity Ratio (x) 0.4 0.1 0.0 0.0 0.1