Mumbai — Heritage Foods Limited reported a nearly 39% decline in consolidated net profit for the quarter ended September 2026, as higher milk procurement costs squeezed profit margins despite strong revenue growth and increased demand for its dairy products.
The company posted a net profit of Rs 31.3 crore for the second quarter of fiscal 2027, down 38.6% from Rs 51 crore in the same period a year earlier, according to a stock exchange filing released Thursday.
Revenue from operations rose 18.6% to Rs 1,320 crore, compared with Rs 1,113 crore in the corresponding quarter last year. The increase was driven by growth in the company’s core milk business and strong sales of value-added dairy products.
Earnings before interest, taxes, depreciation and amortization (EBITDA) fell 4.4% to Rs 73.8 crore from Rs 77.2 crore a year earlier. The company’s EBITDA margin narrowed to 5.6% from 6.9%.
Heritage Foods attributed the decline in profitability primarily to rising milk procurement expenses. The average price paid for milk increased 11% year over year to Rs 47.73 per liter, an increase of Rs 4.74 per liter.
The company said strong market demand, limited growth in milk supplies and higher feed and fodder costs contributed to the increase in procurement prices.
Despite supply challenges during the monsoon season, Heritage Foods reported a 7% increase in milk procurement volumes during the September quarter and 4% growth during the first half of fiscal 2027.
The company said it is working to strengthen relationships with dairy farmers and expand its village-level procurement network to improve milk availability.
Revenue from its core milk business increased 8.5% during the quarter, supported by a 2.5% rise in sales volumes, steady demand in major markets and selective price increases. Average milk selling prices rose 6% to Rs 60.34 per liter.
The company’s value-added dairy products recorded substantially stronger growth, led by lassi and ice cream.
Lassi revenue surged 91% year over year, while ice cream sales climbed 81%. Buttermilk revenue increased 66%, followed by paneer at 38% and curd at 26%.
Sales volumes also rose across these categories. Lassi volumes increased 89%, buttermilk 56%, ice cream 44%, paneer 21% and curd 15% compared with the same quarter last year.
The results highlight the challenges facing Heritage Foods as rising raw material costs continue to pressure profitability even as consumer demand supports expansion across its dairy product portfolio. (Source: IANS)
