AP-based dairy firm eyes Rs 6,000 crore turnover in 5 years

Andhra Pradesh Chief Minister N Chandrababu Naidu set up the Hyderabad-based dairy entity in 1992, which has grown considerably with a presence in 15 states. 

From Rs 4 cr in its first year of operations, it has generated Rs 2,640 cr in 2016-17. Of this, Rs 1,870 cr is from the dairy business, said Brahmani Nara, ED, Heritage Foods, launching its new value-added flavoured milk in seven variants here. 

The firm is now positioning itself as a national player. Its 3.65 per cent equity stake in Future Retail and acquisition of Reliance Retail last month, keeps the company growing and provides access to customers nationally. 

“Future Group will stock Heritage dairy products on its shelves. Earlier, Reliance Retail would not stock our products. Post acquiring Reliance Dairy, they have opened their stores to us all over India,” said Sambasiva Rao, President of the firm. 

This move will boost its domestic footprint as access through modern formats was expanded to 1,000 stores from its earlier 136 Heritage outlets. Brahmani said, the Rs 1 lakh crore value-added products’ category, which constitutes 24 per cent, is expected to contribute 40 per cent of revenues in five years. The focus on this segment would enable the group to achieve its targeted turnover by 2022, she said, anticipating the company’s Y-o-Y growth to be 25 pc over five years. 

With a plan to set up five new facilities involving an outlay of Rs 30 cr for each unit, she said, the company will now enter Punjab, Himachal Pradesh, Madhya Pradesh, Uttarakhand and Uttar Pradesh. Heritage Foods, which has earmarked Rs 90 cr capex for this fiscal, would embark on rebranding and increase marketing spend from 0.5 per cent to 1 per cent of its revenues, Brahmani said. 

Heritage Foods is also in the final stages of formalising a joint venture with a foreign dairy major that would mark its foray into the flavoured yoghurt category, she added.