Heritage Foods Q1 FY26 PAT slips 38% to ₹25 crore as milk costs bite despite 18% revenue growth
Net profit fell to ₹25 crore from ₹40.50 crore on higher milk procurement costs (₹46.61/litre), even as revenue rose 18% to ₹1,338.10 crore. Value-added products now 44% of revenue, ice-cream up 65% to ₹55 crore. Raised stakes in Novandie (100%) and Peanutbutter and Jelly (71%).
What happened
Heritage Foods Q1 FY26 net profit fell to ₹25 crore from ₹40.50 crore on higher milk procurement costs, despite 18% revenue growth. Value-added products hit 44%
Key facts
- PAT ₹25 crore
- prev PAT ₹40.50 crore
- revenue ₹1,338.10 crore
- revenue up 18% YoY
- VAP 44% of revenues
- milk procurement price ₹46.61/litre
- milk selling price ₹58.68/litre up 4%
- ice-cream revenue ₹55 crore up 65%
- Novandie stake 100%
- Peanutbutter and Jelly stake 71%
Why this matters
Raising stakes in Novandie to 100% and Peanutbutter and Jelly to 71% underscores a bolt-on strategy to deepen the higher-margin value-added portfolio and reduce reliance on commodity milk.
What to watch
- Milk procurement price trend (₹/litre) in Q2 flush season
- VAP revenue share crossing 45-48%
- Gross/EBITDA margin trajectory next quarter
- Acquisition integration costs and consolidation impact
- Competitive pricing moves from Amul, Hatsun, Dodla
- Push selective price hikes on liquid milk and pass-through to VAP SKUs
- Accelerate ice-cream and yogurt (Novandie/Danone-brands) distribution expansion
- Optimize procurement sourcing and farmer-network contracts to cap milk cost
- Guide investors toward VAP mix as margin narrative to defend the stock