India's Heritage Foods posts two-fold surge in Q1 profit on higher milk demand, prices

Hatsun Agro Product

31/07/2023 14:53

BENGALURU, July 31 (Reuters) - India's Heritage Foods
 HEFI.NS  posted a first-quarter profit on Monday that more than
doubled, as higher milk prices and sales boosted revenue.
    The Hyderabad-based dairy products company said its
consolidated net profit stood at 167.4 million rupees ($2
million) for the quarter ended June 30, compared with 72.8
million rupees a year earlier. 
    Milk prices in India hit a peak during the June quarter as a
muted production season and heat waves resulted in lower output,
analysts at ICICI Securities said. 
    The average selling price of milk shot up 11% year-on-year,
boosting the company's revenue from the dairy business - its
biggest segment - by 12% to 9.13 billion rupees. 
    The segment, which comprises both milk and milk-based
products, also contributed more than 98% to the company's total
revenue, while earnings before interest, taxes, depreciation and
amortization (EBITDA) surged 67.9%.
    The rise in revenue helped soften the impact of an 11% rise
in total expenses to 9.01 billion rupees, led by an 11% increase
in the cost of material consumed. Average milk procurement rose
9% to 1.52 million litres per day during the quarter.
    Heritage Foods, which counts ice cream, buttermilk and ghee
among its products, said its total revenue from operations rose
12.5% to 9.24 billion rupees.
    Earlier this month, peer Hatsun Agro product  HAPL.NS  said
it posted a 54% rise in its June-quarter profit.
    Shares of the dairy producer closed down 6.75% at 246.75
rupees after the results. 
    
($1 = 82.2670 Indian rupees)

 (Reporting by Kashish Tandon in Bengaluru; Editing by Sonia
Cheema and Janane Venkatraman)
 ((Kashish.Tandon@thomsonreuters.com;))