Heritage Foods (NSEI:HERITGFOOD) - Share price, News & Analysis

Q: What is the Fair Price of HERITGFOOD when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

HERITGFOOD (₹299.95) is trading above our estimate of [[fair value]] (₹128.75)

HERITGFOOD fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	4/6
Past Performance	1/6
Financial Health	6/6
Dividends	5/6

HERITGFOOD Stock Overview

Heritage Foods Limited procures and processes milk and milk products in India.

Rewards

Price-To-Earnings ratio (18.9x) is below the Indian market (21.5x)

Earnings are forecast to grow 28.62% per year

Pays a reliable dividend of 1.67%

Risk Analysis

No risks detected for HERITGFOOD from our risk checks.

Heritage Foods Competitors

Vadilal Industries

BSE:519156

₹17.1b

Dhampur Sugar Mills

BSE:500119

₹15.1b

Apex Frozen Foods

BSE:540692

₹10.9b

Agro Tech Foods

BSE:500215

₹18.6b

Price History & Performance

Summary of all time highs, changes and price drops for Heritage Foods
Historical stock prices
Current Share Price	₹299.95
52 Week High	₹565.00
52 Week Low	₹250.00
Beta	1.02
1 Month Change	4.88%
3 Month Change	4.24%
1 Year Change	-38.13%
3 Year Change	-12.72%
5 Year Change	-52.28%
Change since IPO	14,015.29%

Recent News & Updates

Jul 14

Heritage Foods' (NSE:HERITGFOOD) Dividend Is Being Reduced To ₹2.50

Heritage Foods Limited ( NSE:HERITGFOOD ) has announced that on 4th of August, it will be paying a dividend of₹2.50...

Shareholder Returns

	HERITGFOOD	IN Food	IN Market
7D	7.5%	-1.3%	1.0%
1Y	-38.1%	1.5%	8.0%

Return vs Industry: HERITGFOOD underperformed the Indian Food industry which returned 1.5% over the past year.

Return vs Market: HERITGFOOD underperformed the Indian Market which returned 8% over the past year.

Price Volatility

Is HERITGFOOD's price volatile compared to industry and market?
HERITGFOOD volatility
HERITGFOOD Average Weekly Movement	4.0%
Food Industry Average Movement	7.0%
Market Average Movement	6.6%
10% most volatile stocks in IN Market	9.2%
10% least volatile stocks in IN Market	4.3%

Stable Share Price: HERITGFOOD is less volatile than 75% of Indian stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: HERITGFOOD's weekly volatility (4%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1992	3,009	Srideep Kesavan	https://www.heritagefoods.in

Heritage Foods Limited procures and processes milk and milk products in India. The company operates through Dairy, Renewable Energy, and Feed segment. The Dairy segment produces and markets dairy products, including fresh milk, curd, butter milk, lassi, ice cream, paneer, cooking butter, table butter, flavored milk, UHT milk, sweets, ghee, cheese, cold coffee, cream, skimmed milk powder, frozen desserts, and milk shake.

Heritage Foods Fundamentals Summary

How do Heritage Foods's earnings and revenue compare to its market cap?
HERITGFOOD fundamental statistics
Market Cap	₹13.92b
Earnings (TTM)	₹735.42m
Revenue (TTM)	₹28.54b

18.9x

P/E Ratio

0.5x

P/S Ratio

Is HERITGFOOD overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
HERITGFOOD income statement (TTM)
Revenue	₹28.54b
Cost of Revenue	₹22.71b
Gross Profit	₹5.83b
Other Expenses	₹5.10b
Earnings	₹735.42m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	15.85
Gross Margin	20.43%
Net Profit Margin	2.58%
Debt/Equity Ratio	2.9%

How did HERITGFOOD perform over the long term?

See historical performance and comparison

Dividends

1.7%

Current Dividend Yield

32%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is HERITGFOOD undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for HERITGFOOD?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for HERITGFOOD. This is calculated by dividing HERITGFOOD's market cap by their current preferred multiple.
What is HERITGFOOD's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	₹13.92b

HERITGFOOD key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.5x
Enterprise Value/EBITDA	8.4x
PEG Ratio	0.7x

Price to Earnings Ratio vs Peers

How does HERITGFOOD's PE Ratio compare to its peers?

HERITGFOOD PE Ratio vs Peers

The above table shows the PE ratio for HERITGFOOD vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	41.9x
519156 Vadilal Industries	38.2x	n/a	₹17.1b
500119 Dhampur Sugar Mills	9.9x	39.4%	₹15.1b
540692 Apex Frozen Foods	19.4x	n/a	₹10.9b
500215 Agro Tech Foods	100.2x	n/a	₹18.6b
HERITGFOOD Heritage Foods	18.9x	28.6%	₹13.9b

Price-To-Earnings vs Peers: HERITGFOOD is good value based on its Price-To-Earnings Ratio (18.9x) compared to the peer average (41.9x).

Price to Earnings Ratio vs Industry

How does HERITGFOOD's PE Ratio compare vs other companies in the IN Food Industry?

Price-To-Earnings vs Industry: HERITGFOOD is good value based on its Price-To-Earnings Ratio (18.9x) compared to the Indian Food industry average (23.3x)

Price to Earnings Ratio vs Fair Ratio

What is HERITGFOOD's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

HERITGFOOD PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	18.9x
Fair PE Ratio	25.3x

Price-To-Earnings vs Fair Ratio: HERITGFOOD is good value based on its Price-To-Earnings Ratio (18.9x) compared to the estimated Fair Price-To-Earnings Ratio (25.3x).

Share Price vs Fair Value

What is the Fair Price of HERITGFOOD when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: HERITGFOOD (₹299.95) is trading above our estimate of fair value (₹128.75)

Significantly Below Fair Value: HERITGFOOD is trading above our estimate of fair value.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.

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Future Growth

How is Heritage Foods forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

28.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: HERITGFOOD's forecast earnings growth (28.6% per year) is above the savings rate (6.8%).

Earnings vs Market: HERITGFOOD's earnings (28.6% per year) are forecast to grow faster than the Indian market (18.7% per year).

High Growth Earnings: HERITGFOOD's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: HERITGFOOD's revenue (12.2% per year) is forecast to grow faster than the Indian market (10.8% per year).

High Growth Revenue: HERITGFOOD's revenue (12.2% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: HERITGFOOD's Return on Equity is forecast to be low in 3 years time (18.1%).

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Past Performance

How has Heritage Foods performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-2.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: HERITGFOOD has high quality earnings.

Growing Profit Margin: HERITGFOOD's current net profit margins (2.6%) are lower than last year (3.4%).

Past Earnings Growth Analysis

Earnings Trend: HERITGFOOD's earnings have declined by 2.2% per year over the past 5 years.

Accelerating Growth: HERITGFOOD's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: HERITGFOOD had negative earnings growth (-12.9%) over the past year, making it difficult to compare to the Food industry average (13.7%).

Return on Equity

High ROE: HERITGFOOD's Return on Equity (11.2%) is considered low.

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Financial Health

How is Heritage Foods's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: HERITGFOOD's short term assets (₹2.9B) exceed its short term liabilities (₹1.8B).

Long Term Liabilities: HERITGFOOD's short term assets (₹2.9B) exceed its long term liabilities (₹624.5M).

Debt to Equity History and Analysis

Debt Level: HERITGFOOD has more cash than its total debt.

Reducing Debt: HERITGFOOD's debt to equity ratio has reduced from 51% to 2.9% over the past 5 years.

Debt Coverage: HERITGFOOD's debt is well covered by operating cash flow (768.3%).

Interest Coverage: HERITGFOOD's interest payments on its debt are well covered by EBIT (54.5x coverage).

Balance Sheet

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Dividend

What is Heritage Foods's current dividend yield, its reliability and sustainability?

Dividend Score

5/6

Dividend Score 5/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

1.67%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: HERITGFOOD's dividend (1.67%) is higher than the bottom 25% of dividend payers in the Indian market (0.39%).

High Dividend: HERITGFOOD's dividend (1.67%) is low compared to the top 25% of dividend payers in the Indian market (1.71%).

Stability and Growth of Payments

Stable Dividend: HERITGFOOD's dividends per share have been stable in the past 10 years.

Growing Dividend: HERITGFOOD's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (31.5%), HERITGFOOD's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its low cash payout ratio (22.9%), HERITGFOOD's dividend payments are well covered by cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

4.5yrs

Average management tenure

CEO

Srideep Kesavan

1.08yrs

Tenure

₹10,190,000

Compensation

Mr. Srideep Nair Kesavan is Chief Executive Officer of Heritage Foods Limited from July 2021. Prior to joining Heritage Foods, Kesavan held leadership positions at Coca-Cola for 14 years & Olam Internation...

Leadership Team

Experienced Management: HERITGFOOD's management team is considered experienced (4.5 years average tenure).

Board Members

Experienced Board: HERITGFOOD's board of directors are considered experienced (8.8 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/09 00:00
End of Day Share Price	2022/08/08 00:00
Earnings	2022/06/30
Annual Earnings	2022/03/31