The core engine of this growth was the company’s strategic focus on its Value-Added Products (VAP) portfolio. VAP revenue expanded by a robust 18% to INR 4,132.00 crore, now contributing a substantial 38% to the company’s total sales. High-growth categories, including curd, paneer, drinkables, and ice cream, all registered double-digit growth. This successful portfolio premiumization strategy allows Heritage Foods to mitigate risks associated with volatile commodity milk prices.

Despite the strong revenue growth, the company faced considerable pressure on profitability margins. The EBITDA margin declined by 122 basis points, primarily due to a 6.3% increase in milk procurement costs which outpaced a more modest 4.5% rise in realizations (selling prices). Nonetheless, efficient cost management and strategic execution ensured that Profit After Tax (PAT) grew by 5% for the quarter, demonstrating controlled profitability during a cost-intensive period.

Operationally, the company maintained its market presence, with milk sales growing by 1.1% to 12.1 lakh liters per day. Furthermore, Heritage Foods significantly expanded its market reach, adding 6,000 new retail outlets and increasing its distribution network by 60 points. Strong financial and operational performance was also observed in the subsidiary, Heritage Nutrivet, which reported a 34% revenue increase and an impressive 80% growth in PBT.