iStock has buy call on Heritage Foods with a target price of Rs 400. The current market price of is Rs 279.15. Time period given by analyst is one year when . price can reach defined target.
Heritage Foods Ltd., incorporated in the year 1992, is a Small Cap company (having a market cap of Rs 1285.69 Crore) operating in FMCG sector.
Heritage Foods Ltd. key Products/Revenue Segments include Dairy And Food Processing, Other Operating Revenue and Sale of services for the year ending 31-Mar-2022.
Financials
For the quarter ended 30-06-2022, the company reported a Consolidated Total Income of Rs 823.57 Crore, up 17.93 % from last quarter Total Income of Rs 698.36 Crore and up 26.53 % from last year same quarter Total Income of Rs 650.90 Crore. Company reported net profit after tax of Rs 9.14 Crore in latest quarter.
Investment Rationale
Rising share of value added products and strong up-tick in curd volume sales are the key positives of 1QFY23 result. Revenue grew 26.7% YoY but EBITDA margin declined to 2.9% (lowest in past 44 quarters) due to delayed price hikes. Heritage continued to launch new products during the quarter. It remains believer of Heritage to be a beneficiary of steady value migration from co-operatives and unorganised players to private players. It models Heritage to report PAT CAGR of 30.2% over FY22-FY24 with (1) high single-digit growth in milk procurement and (2) steady increase in the share of value-added product portfolio. It cuts earnings estimates due to delay in price hikes. It stays positive and maintain BUY rating on the stock with a revised DCF-based target price of Rs400 (10x of FY24E EPS; prior TP: Rs450).
Promoter/FII Holdings
Promoters held 39.43 per cent stake in the company as of 30-Jun-2022, while FIIs owned 2.04 per cent, DIIs 14.65 per cent.
Heritage Foods Ltd., incorporated in the year 1992, is a Small Cap company (having a market cap of Rs 1285.69 Crore) operating in FMCG sector.
Heritage Foods Ltd. key Products/Revenue Segments include Dairy And Food Processing, Other Operating Revenue and Sale of services for the year ending 31-Mar-2022.
Financials
For the quarter ended 30-06-2022, the company reported a Consolidated Total Income of Rs 823.57 Crore, up 17.93 % from last quarter Total Income of Rs 698.36 Crore and up 26.53 % from last year same quarter Total Income of Rs 650.90 Crore. Company reported net profit after tax of Rs 9.14 Crore in latest quarter.
Investment Rationale
Rising share of value added products and strong up-tick in curd volume sales are the key positives of 1QFY23 result. Revenue grew 26.7% YoY but EBITDA margin declined to 2.9% (lowest in past 44 quarters) due to delayed price hikes. Heritage continued to launch new products during the quarter. It remains believer of Heritage to be a beneficiary of steady value migration from co-operatives and unorganised players to private players. It models Heritage to report PAT CAGR of 30.2% over FY22-FY24 with (1) high single-digit growth in milk procurement and (2) steady increase in the share of value-added product portfolio. It cuts earnings estimates due to delay in price hikes. It stays positive and maintain BUY rating on the stock with a revised DCF-based target price of Rs400 (10x of FY24E EPS; prior TP: Rs450).
Promoter/FII Holdings
Promoters held 39.43 per cent stake in the company as of 30-Jun-2022, while FIIs owned 2.04 per cent, DIIs 14.65 per cent.
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