Financial Performance Overview

Consolidated Financials (Q1 FY27):

  • Revenue: ₹13,381 million (18% YoY growth)
  • EBITDA: ₹619 million
  • EBITDA Margin: 4.6%
  • Profit After Tax: ₹150 million
  • PAT Margin: 1.9%

Operational Highlights

Milk Procurement:

  • Average daily procurement: 18.10 lakh liters per day (2% YoY increase)
  • Milk procurement price: ₹46.61 per liter (7% YoY increase)
  • Milk sales price: ₹58.68 per liter (4% YoY increase)
  • Milk sales volumes remained stable

Value-Added Products (VAP) Performance:

  • VAP revenue: ₹5,636 million (40% YoY growth)
  • Broader VAP portfolio (including consumer pack ghee/butter): ₹6,322 million (39% YoY growth)
  • VAP contribution to revenue: 44% (vs 36% in Q1 FY26)
  • Broader VAP contribution: 49% (vs 41% in Q1 FY26)

Volume Growth by Category (YoY):

  • Paneer: 33%
  • Curd: 26%
  • Ice cream: 25%
  • Butter milk: 60%
  • Lassi: 98%

Price Actions:

  • Value-added products: 5.12% weighted average price increase
  • Milk: 4% price increase YoY
  • Ongoing price hikes implemented across markets in July 2026

Business Segment Performance

Ice Cream Business:

  • Revenue: Crossed ₹550 million (65% YoY growth)
  • Alpenvie brand: 44% growth
  • Get-A-Way brand: 196% growth (near breakeven bottom line)
  • New ice cream facility: ~40% capacity utilization

Heritage Nutrivet Limited (Animal Nutrition):

  • Revenue: ₹728 million (37% YoY growth)
  • PBT: ₹20 million

Strategic Developments

Subsidiary Investments:

  • Heritage Novandie Foods became wholly owned subsidiary (Livo brand)
  • Increased shareholding in Peanut butter and Jelly Limited to 71%

Brand Development:

  • Alpenvie undergoing brand refresh with new identity and SKU launches
  • Nourish+ gaining traction, especially high-protein paneer variant
  • Sampurna A2 Curd, chef's choice curd, and organic milk showing encouraging acceptance

Capacity Expansion:

  • Capex plan for FY27: ~₹250 crores
  • Ongoing projects: paneer facility and ghee facility
  • New ice cream facility operational manufacturing both Alpenvie and Get-A-Way portfolios

Procurement Outlook

Current Market Conditions:

  • Mini flush in April-May 2026 did not materialize as expected
  • Procurement prices increased from March to June 2026
  • Prices currently stable but subject to weather conditions
  • Expected flush season in Q3 (October onwards)

Farmer Network Expansion:

  • Added ~5,000 farmers in Q1 FY27
  • Planning to add another 5,000 farmers in Q2 FY27
  • Focus on village-level collection centers and farmer productivity

Margin Analysis

Gross Margin Pressure:

  • Primary factors: Raw milk price increase, SMP consumption at higher prices, packing material costs
  • Cow milk: ₹43.2/liter (vs ₹42.10 in Q4 FY26)
  • Buffalo milk: ₹65.99/liter (vs ₹61.38 in Q4 FY26)
  • Buffalo milk volumes declined over 20% YoY

Operating Leverage Benefits:

  • Other expenses: 9.01% of revenue (vs 9.64% in Q1 FY26)
  • Employee benefits: 6.74% of revenue (vs 7.21% in Q1 FY26)
  • Total operating leverage improvement: ~1.1%

Market Share & Distribution

Market Position:

  • Gained market share in organized channels across curd, paneer, and butter milk categories
  • Growth drivers: 80% distribution expansion, 20% increased consumer traction
  • No new geographic expansion - growth from existing markets

Loss-Making Segments Improvement:

  • Ghee business EBITDA improved from -12% to -8.5% YoY
  • Loss-making regions showing reduced losses

Management Guidance

Long-term Growth Targets:

  • Revenue growth: Mid-to-high teens (16-17%)
  • Milk volume growth: 7-8%
  • Value-added products growth: ~25%
  • Target EBITDA: High single digits

Short-term Outlook:

  • Procurement prices expected to remain firm
  • Continued price hikes being implemented
  • Q2 FY27 expected to be challenging due to supply tightness

Recognition & Awards

  • Received Investor Relations Excellence Award in F&B category from Investor Relations Society
  • Vice Chairperson & Managing Director Mrs. Bhuvaneswari Nara and Executive Director Mrs. Nara Brahmani recognized among Fortune India's Most Powerful Women 2026

Conference Call Participants

Management Team:

  • Mrs. N Brahmani - Executive Director
  • Dr. M Sambasiva Rao - Whole Time Director
  • Mr. Srideep Kesavan - Chief Executive Officer
  • Mr. A Prabhakara Naidu - Chief Financial Officer
  • Mr. J Samba Murthy - Chief Operating Officer
  • Dr. Brij Mohan - Chief Executive Officer, Heritage Nutrivet Limited
  • Mr. Umakanta Barik - Company Secretary & Compliance Officer

Investor Relations:

  • Ms. Garima Singla - GO India Advisors