India today presents a field of opportunity. The government's continuous thrust to strengthen the country's economy through policies and regulations, infrastructure development, capital spending, etc., have contributed to GDP growth of over 8% in 2023-24. This has set a strong foundation to realise the Viksit Bharat vision. During the year in review, the company harnessed its strengths and benefitted from a strong industry environment, thus registering a stellar financial performance for the year. The company's consolidated revenue rose by 17.1% to ₹37,939 million in 2023-24. EBIDTA increased by 51.6% to ₹2,095 million with an EBIDTA margin of 5.52%. Likewise, net profit charted a strong growth of 83.6% to ₹1,065 million. On the operational front, our average milk procurement grew by 11% YoY to 1.55 MLPD, indicating our improving procurement and processing capabilities. We have built an overall 2.78 MLPD milk processing capacity, indicating our preparedness for future growth. The highlight of this past year was our success in growing the share of the value-added product segment. Revenue from these products grew by 18.7% to ₹11,063 million, against ₹9,322 million in the previous year. Furthermore, revenue from the fat products and ice cream segment grew by 102.9% and 38.4% to ₹3,046 million and ₹761 million, respectively, for the year. This shows growing consumer affinity for our products and also mirrors the premiumisation trend playing out in the consumption space. Revenue from milk registered an impressive 8.1% growth to ₹22,190 million during the year, which is creditable considering a high base. With a commitment to providing nutritious, delicious and enjoyable products to our consumers, we launched several products under Heritage brands in 2023-24, including toned and skimmed milk, new ice cream variants, new flavoured curds, new variants of fresh milk, etc. The launch pipeline for the current year is strong too, especially as we see an opportunity in healthy variants of traditional sweets using millets, etc. Dairy farmers are the backbone of our enterprise. Truly, their success is our success. In fact, the company was started with the noble objective of serving the farming community in India. We have strived to empower our dairy farmers through many development-centric initiatives, such as free veterinary care, provision for subsidised cattle feed, cattle insurance, etc. Furthermore, Heritage VET+ app has helped revolutionise farm communities through providing knowledge and insights about animal care, diseases, etc., right in the hands of farmers. Having built the institutional strengths necessary to operate a successful dairy enterprise, we have formulated a multi-pronged growth strategy that will help unlock the full potential of our buisness. Some of these include: • Prudent investment in village-level milk collection infrastructure • Growing the share of value-added products, especially considering growing consumer inclination towards branded, healthier and nutritious alternatives • Enter new geographies and enlarge our presence in existing ones, especially on the back of our strong distribution network • Expand our product portfolio, centered around consumer delight • Fortify our farmer empowerment activities, enabling them to increase their livelihood, etc. Overall, our aspiration is to be a nationally-recognised brand distinguished by our healthy, nutritious, fresh and accessible dairy products. In closing, I take this opportunity to appreciate the support and cooperation of all our stakeholders. You been instrumental in contributing to build what the company is today. N. Bhuvaneswari Vice-Chairperson & Managing Director STRATEGIC REVIEW STATUTORY REPORT FINANCIAL STATEMENTS 17 HERITAGE FOODS LTD | 32ND ANNUAL REPORT 2023-24
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