Heritage Foods Limited | 30th Annual Report 2021-22

Over the years, we have endeavoured to maintain high standards of quality in our offerings. Now, we are working towards transforming into a prominent health and nutrition player through our value added products (VAP). In the year under review, the strength and agility of our business model helped us meet our targets and rise above the challenges to start the new financial year on a strong footing. Macroeconomic review The FY 21-22 turned out to be significantly more volatile than expected. While the global economy rebounded faster than projected and demand for dairy products remained strong, the pandemic’s repeated waves left a lasting impact. Supply chain disruptions, escalating prices and runaway inflation, induced by geopolitical upheavals, had widespread ramifications on businesses globally. In India, after the debilitating impact of Covid-19 in 2020-21, the dairy sector rebounded significantly owing to the strong demand revival for milk and value- added products. The demand is likely to increase with the rising population, higher disposable income and higher per-capita consumption. Transforming into a prominent health and nutrition player India, being the world’s largest milk producer, we are seizing every opportunity to capitalise on the growing dairy demand by constantly evaluating our products, distribution channels and supply chain. I am confident our efforts will increase the scalability as well as profitability of our business in the near term, creating value for our stakeholders. Over the years, we have endeavoured to maintain high standards of quality in our offerings. Now, we are working towards transforming into a prominent health and nutrition player through our value added products (VAP). Foraying into new segments In the year under review, we continued to enhance our portfolio of value-added products (VAP), and I am happy to inform that we forayed into new ‘Ready To Eat’ and ‘Heat-n-Eat’ segments and strengthened our VAP proposition by launching spiced butter and cup curd as well as Kesar Shrikhand and Amrakhand in its main markets. Heritage Novandie forayed into yogurt production in Maharashtra and introduced Mamie Yova branded ‘French Yogurt’ along with ‘Yo Pop’, a drinkable yoghurt. We have also focussed on pushing our brand recall higher through franchisee operated parlours and distribution centres, besides an omni-channel network. Financial performance (Standalone) We registered a net revenue of H 26,429 million compared to H 24,070 million in the previous financial year. Our EBITDA and PAT stood at H 1,873 million and H 1,015 at 7.09 % and 3.84 % margins, respectively. For Heritage Nutrivet Limited, wholly- owned subsidiary company registered a revenue of H 946 million. EBITDA stood at H 47 million and PAT stood at H 11 million. Scaling new heights New-age consumers prefer healthier and more responsibly produced food. To cater to these evolving demands, we are striving to deliver healthy products with superior taste. Even as we strengthen the brand, we facilitate financial support for cattle purchase, resulting in rising milk production and employment for farmers. With strong foundations, a diverse portfolio, omni-channel presence and deep social commitments, we remain determined to create sustainable value for all our stakeholders. We aspire to be a nationally recognised brand with a focus on efficient capital management and maximising shareholders’ value. I take this opportunity to thank our team for their dedicated efforts. I will also like to thank our customers and our shareholders for their unwavering belief in us. Together with your support, we will scale newer heights. N. Bhuvaneswari Vice-Chairperson & Managing Director Corporate Overview 11