Heritage Foods was listed on the NSE on November 27, 1996. In the last five years, the company has given a massive return of more than 250% to its investors. Will Heritage Foods continue to provide such great returns in the future as well? Let’s explore Heritage Foods’ growth potential and Heritage Foods share price target from 2025 to 2050 in this article.
About Heritage Foods
Heritage Foods is an Indian company founded in 1992 by N. Chandrababu Naidu. The company is in the dairy products, cattle feed, and renewable energy business. The company primarily produces milk, curds, butter, ghee, and other dairy products. Heritage Foods has expanded over the years and now sells its products in many states across India. It is known for providing its customers with fresh, high-quality dairy products. The company also promotes sustainability by investing in renewable energy sources such as solar and wind power.
Heritage Foods Business Model
- Milk Sales: Heritage Foods generates revenue by selling milk directly to customers through its retail stores and online platforms.
- Dairy Products: The company turns milk into more profitable products such as curd, butter, ghee, and paneer.
- Retail stores: Heritage Foods operates retail stores that sell dairy and other food products, which boosts its direct sales revenue.
- Institutional Sales: The company provides milk and dairy products in bulk to hotels, restaurants, and other businesses, ensuring consistent sales.
- Exports: Heritage Foods exports dairy products to other countries, increasing revenue from international customers.
- Agri Business: The company manufactures and sells cattle feed to dairy farmers, generating revenue while promoting milk production.
- Franchise Model: Heritage Foods allows franchisees to open stores under its brand, generating revenue through franchise fees and product sales.
- E-commerce: Customers can purchase milk and dairy products online, creating a convenient sales channel and increasing revenue.
- Renewable Energy: Heritage Foods invests in renewable energy projects such as solar and wind power to reduce costs and generate revenue.
Heritage Foods Fundamental Analysis
| Stock Name | Heritage Foods Ltd. |
|---|---|
| NSE Symbol | HERITGFOOD |
| Market Cap | ₹ 3,510 Cr. |
| 52W High | ₹ 728 |
| 52W Low | ₹ 296 |
| Stock P/E | 18.4 |
| Book Value | ₹ 96.1 |
| Dividend Yield | 0.66 % |
| ROCE | 16.2 % |
| ROE | 13.3 |
| Face Value | ₹ 5.00 |
| Shareholders | Mar 2023 | Mar 2024 | Dec 2024 |
|---|---|---|---|
| Promoters | 41.57% | 41.30% | 41.30% |
| FIIs | 1.98% | 2.01% | 6.65% |
| DIIs | 15.90% | 11.74% | 3.98% |
| Public | 40.55% | 44.96% | 48.08% |
| No. of Shareholders | 43,315 | 56,225 | 1,34,476 |
Key Factors Driving Heritage Foods Future Growth
- Rising Income Levels: As people’s incomes rise, they are more willing to spend on Heritage Foods’ premium dairy products.
- Growth in Online Sales: As more people shop for groceries online, Heritage Foods is expanding its digital presence.
- Sustainable and Ethical Practices:Heritage Foods focusses on environmentally friendly and ethical farming practices, which appeal to health-conscious and responsible consumers.
- Expansion into New Markets: Heritage Foods is expanding into new states and regions, which helps to increase sales.
- Government Support for Dairy Industry: Government Support for the Dairy Industry: Government policies and subsidies for dairy farming benefit and help Heritage Foods grow.
- Strong Supply Chain Management: Heritage Foods guarantees fresh and timely delivery of its products, keeping customers happy.
- Strategic partnerships and acquisitions: Heritage Foods is collaborating with other businesses to expand and improve its offerings.
- Rising Awareness of Protein-Rich Diets: More people now prefer dairy for nutrition, resulting in increased demand for Heritage Foods products.
- Effective Marketing and Advertising: Heritage Foods promotes its products effectively via television, social media, and other channels, raising brand awareness.
- Investment in Technology: Heritage Foods invests in modern technology to improve milk processing, packaging, and storage, resulting in higher quality.
Pros of Heritage Foods
- Low PE Ratio Compared to Peers: Heritage Foods has a PE ratio of 19.0, which is lower than the industry average of 30.1, making it relatively undervalued compared to its earnings.
- Low Debt Levels: With a low debt-to-equity ratio of 0.16, Heritage Foods has a minimum dependency on debt, reducing financial risk and interest expenses.
- Increase in DIIs Holding: DIIs holding increased from 3.89% in September 2024 to 3.98% in December 2024, showing a positive outlook towards Heritage Foods by the DIIs.
Cons of Heritage Foods
- Decreasing Profits – Heritage Foods profits are decreasing at a CAGR of 12%. over the last three Years.
- High Price to Book Value: Heritage Foods is trading at a Price-to-Book Value (P/B) ratio of 4.22, which indicates that its stock is significantly overvalued compared to its book value.
- Decrease in FIIs Holding: Foreign Institutional Investors (FIIs) have reduced their holding to 6.65% in December 2024 from 8.27% in September 2024, indicating a decline in FII’s confidence in the company’s future growth prospects.
| Years | Target Price |
|---|---|
| Heritage Foods Share Price Target 2025 | ₹472 to ₹590 |
| Heritage Foods Share Price Target 2026 | ₹570 to ₹770 |
| Heritage Foods Share Price Target 2027 | ₹680 to ₹1000 |
| Heritage Foods Share Price Target 2028 | ₹815 to ₹1300 |
| Heritage Foods Share Price Target 2029 | ₹980 to ₹1700 |
| Heritage Foods Share Price Target 2030 | ₹1200 to ₹2200 |
| Heritage Foods Share Price Target 2035 | ₹2350 to ₹6600 |
| Heritage Foods Share Price Target 2040 | ₹4700 to ₹19800 |
| Heritage Foods Share Price Target 2050 | ₹18800 to ₹118800 |
Conclusion
Heritage Foods has demonstrated strong growth over the years, supported by its diversified business model, expanding market presence, and focus on sustainability. While the company has provided impressive returns in the past, its future performance will depend on factors such as rising consumer demand, technological advancements, and government support for the dairy industry. Despite challenges like declining profits and a high valuation, Heritage Foods’ expansion into new markets, investments in renewable energy, and strategic partnerships position it for long-term growth. For the latest updates, you can visit HERITAGE FOODS official website.
Disclaimer
This article is for educational purposes only. It is not a stock recommendation and should not be treated as such. Please ask your financial advisor before making any investment decision.
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