Heritage Foods Limited

STATUTORY REPORTS MDA 29 th Annual Report 2020-21 | 101 CORPORATE OVERVIEW Heritage Foods Limited (the Company) being considered as the one of the top nutrition provider having the vision for a better future, a future where everyone enjoys the bene fi ts of positive sociability and living well through responsible consumption and easy access to good nutrition. Where our people, consumers, customers, suppliers and all of the communities we touch thrive and prosper and it’s this vision that helps guide our decision making at every level of the organisation. We do this through nutrition initiatives like Our Goodness Promise, which celebrates the existing goodness of our products, and illustrates our commitment to further improve their nutritional valued by supplying processed milk and other value added products to consumers in the urban areas. We now have over 29 years of legacy in the Indian dairy space. The Company has adopted Indian Accounting Standard (Ind AS) noti fi ed under the Companies (Indian Accounting Standard) Rules 2015 as amended from time to time and accordingly the Standalone & Consolidated Financial Statements have been prepared in accordance with Ind AS prescribed under Section 133 of the Companies Act, 2013 read with the Rules made thereunder. The Management accepts responsibility for the integrity and objectivity of the fi nancial statements, as well as for the various estimates and judgments used therein. These estimates and judgments relating to fi nancial statements are prudently made to re fl ect in a true and fair manner in line with the form and substance of transactions. This also enables in reasonably presenting the Company’s state of a ff airs and statement of pro fi t & loss and cash fl ows for the year ended March 31, 2021. GLOBAL ECONOMY The global economy witnessed an unprecedented crisis in 2020 as the outbreak of the novel coronavirus (COVID-19) in China towards the end of 2019 spread rapidly across the globe. The rising human toll worldwide and the millions of people that remain unemployed have resulted in the extreme social and economic strain that the global community still confronts. While ensuing lockdowns announced by all major economies played a critical role in saving lives, they resulted in severe damage to economic activities, thereby plunging the world economy into a recession. As per the International Monetary Fund (IMF), the global economy contracted by 3.3%vis-à-vis 2.8%growth registered in 2019. While Advanced Economies (AEs) declined by 4.7%, with Management Discussion & Analysis (MD&A) the USA and Europe contracting by 3.5% and 6.6% respectively, Emerging Markets and Developing Economies (EMDEs) clocked a relatively less contraction of 2.2%, the improvement largely re fl ects rebound in the Chinese economy in the second half of CY 2020 post successful containment of virus spread in the country. (Source: IMF WEO) Global Economic Growth: Actual and Projections (%) Particulars 2019 2020 2021(P) 2022(P) Global output 2.8 (3.3) 6.0 4.4 Advanced Economies 1.6 (4.7) 5.1 3.6 Emerging Markets and Developing Economies (EMDEs) 3.6 (2.2) 6.7 5.0 Source: IMFWorldEconomicOutlook, April 2021, P=Projections Following the devastating health and economic crisis, the global economy appears to be emerging from one of its deepest recessions and beginning a subdued recovery. Substantial fi scal and monetary stimulus packages enforced by the governments and central banks across the globe have been playing a pivotal role in the economic recovery. Successful vaccination programs will boost investor sentiment and will lead to kickstart private capital in fl ows and fi xed capital formation. Backed by improving macro-economic indicators, the IMF estimates the global economy to grow at 6.0% in 2021. However, limiting the spread of the new strain of the virus; providing relief to vulnerable populations; and overcoming vaccine-related challenges are key policy priorities.(Source: IMF WEO April, 2021) INDIAN ECONOMY The Indian economy is estimated to have contracted by 8.0% in FY 2020-21 as against 4.0% growth recorded in FY 2019-20, marking a recession since 1980. Overall economic slowdown, led by COVID-19 onstage followed by stringent lockdowns severely impacted economic activity, bringing manufacturing and trading activities to a screeching halt. Prolonged lowdown exacerbated existing vulnerabilities of the country including the weakened fi nancial sector, private investments/ and consumption demand. The escalating second wave of coronavirus infections present a risk to the growth forecast for FY 2021-22 as the re-imposition of virus management measures is expected to curb economic activity and could dampen market and consumer sentiment. The Government announced a special comprehensive package of ` 20 lakh crore, equivalent to 10% of India’s GDP under ‘Self- Reliant India’ movement to revive the country’s languishing