Heritage Foods Limited | 30th Annual Report 2021-22

Financial Statements Company Overview Statutory Reports 97 attributed to numerous forces. The ice-cream market in India is expected to grow at a CAGR of 17.3 per cent during FY 2021- 2026. Fat Products Ɣ Ghee Ghee, which is widely used in Indian cooking, is the pure butter fat left over after the milk solids and water are removed from butter. It is very fragrant with a rich taste and is the second largest consumed dairy product in India, after liquid milk. The ghee market in India is expected to exhibit strong growth during FY 2021-2026. Ɣ Butter Heritage butter is made from best quality fresh cream and contains no added ingredients other than salt. Manufactured in state-of-the-art processing plants with utmost care to ensure goodness, the table butter market in India is expected to grow at a CAGR of 19 percent during FY 2021-2026. Ɣ Cream The Indian cream market exhibited strong growth during FY 2015-2020. Cream is a dairy product which is used to give a smooth texture and consistency to food products. Nowadays, it is widely used in the preparation of various dishes, desserts and beverages such as ice-creams, salads, sweet meals, tea, coffee, etc. The Indian cream market is likely to grow at a CAGR of around 15 per cent during FY 2021-2026. Distribution The Company has a wide distribution network that ensures that its products are available across the country. Heritage parlours and Heritage distribution centres are franchised stores and distribution wings that sell the whole line of items offered by the Company. It considers every distribution outlet as an ambassador of the Heritage brand. Through these distribution arms, it ensures that consumers receive high-quality goods and services. As on March 31, 2022, the Company had 6,464 agents/distributors in general trade, 859 Heritage parlours and 65 Heritage distribution centres in 11 states across India. Heritage products are available in all modern retail stores and e-commerce channels. Empowering Farmer Community Growth and welfare of the farmer community is at the core of the Company’s operations. The Company is on a continual quest to empower the farmers by procuring milk at mutually beneficial costs, encouraging best practices around the quality and quantity of milk and providing support services to help them improve their milk yields by organising free veterinary check-ups and vaccination drives for the cattle. Extending farm loans and cattle insurance and providing nutritional livestock feed at subsidised rates are other significant steps adopted by the Company. All these interventions have enabled it to forge strong relationships with farmers. Review of Operations Tangible Results: Financial year Revenue from operation ( ` in Million) EBIDTA ( ` in Million) PAT ( ` in Million) FY22 26,429 1,873 1,015 FY21 24,070 2,565 # 1,452 FY20 26,811 (769) # (1,600) # FY19 24,823 1,924 834 FY18 23,440 1,333 604 # EBITDA and PAT is after considering the Fair value gain on FVTPL equity shares and loss due to changes in derivative liabilities of Investments in FRL. Revenue Trend The Company is gradually targeting to grow contribution of value added products to consolidate top line. Curd will continue to remain the largest component of value- added product segment, contributing to over 79% share to the value-added segment. Other products constitute buttermilk, flavored milk, lassi, paneer and ice creams/frozen dessert. Dairy Vertical: The Dairy division accounting for 99.98% of revenue is the flagship business vertical of the Company. The 5-year revenue of the dairy vertical is given below: Dairy Revenue MDA