Firstcall is bullish on Heritage Foods and has recommended buy rating on the stock with a target price of Rs 560 in its research report dated February 23, 2016.
The research by Firstcall about Heritage Foods says that the Heritage Group was founded in the year 1992 by Mr. Nara Chandrababu Naidu. It is one of the fastest growing Public Listed Companies in India, with five-business divisions-Dairy, Retail, Agri, Bakery and Renewable Energy under its flagship Company Heritage Foods Limited (Formerly known as Heritage Foods (India) Limited). The annual turnover of Heritage Foods crossed Rs 2072.97 crores in financial year 2014-15.
It further reported the presence of Heritage Foods in various states of India. Heritage’s milk and milk products have a market presence in Andhra Pradesh, Telangana, Karnataka, Kerala, Tamil Nadu, Maharastra, Odisha and NCR Delhi and its retail stores across Bangalore, Chennai and Hyderabad. Integrated agri operations are in Chittoor and Medak Districts and these are the backbone to retail operations and the state of art Bakery plant at Uppal, Hyderabad, Telangana.
In 1994, Heritage Foods public Issue was oversubscribed by 54 times. The company is listed on BSE and NSE. The Company has two subsidiary companies, Heritage Foods Retail limited and Heritage Conpro Limited.
Heritage Foods is the only packaging partner for curd for Nestle in South India. The company’s value chain commences right from the grassroots level with over 3 lakh farmers from whom 9 lakh litres of milk is procured daily and delivered to over 15 lakh customers located across India and also various value-added milk products through Heritage Parlours and Heritage Fresh stores.
The company also exports ghee and butter in bulk and consumer packs to Asia, Europe and Gulf countries including Singapore. The vertical integration of linkages between farm level production, procurement and downstream processing and trade has lead to more efficient and effective control of cost and quality as visible in the improved profit and operating margins in the past few quarters.
Firstcall recommends ‘BUY’ in this particular scrip with a target price of Rs. 560.00 for Medium to Long term investment.