Heritage Foods Ltd. has approved the proposed amalgamation of its subsidiary, Heritage Novandie Foods Limited, with the parent company as part of its strategy to simplify its corporate structure and strengthen its value-added dairy business. The subsidiary operates the company’s yogurt business under the Livo brand, which Heritage Foods describes as one of India’s top five yogurt brands.
The proposed merger is expected to improve operational coordination, optimise administrative costs and integrate Livo more closely with Heritage Foods’ distribution network and dairy operations. The move comes as the company seeks to increase the contribution of value-added dairy products to its overall business, reflecting a broader shift towards differentiated and branded dairy categories.
Value-Added Dairy Revenue Continues to Grow
Heritage Foods has reported an increasing contribution from value-added dairy products, excluding ghee and butter. These categories include products such as yogurt and other dairy offerings that provide opportunities to develop differentiated consumer propositions.
During the second quarter of FY2026–27, value-added dairy products accounted for 35.4% of dairy revenue, compared with 31.3% in the corresponding period a year earlier. For the first half of FY2026–27, their contribution reached 39.6%, up from 33.7% in the previous year’s comparable period.
The company has set a three-year target of approximately 50% revenue contribution from value-added products. Achieving this objective would require continued growth across its product portfolio, stronger distribution and effective integration of its business operations.
| Business indicator | Reported figure |
|---|---|
| Q2 FY2026–27 contribution | 35.4% |
| Q2 previous-year contribution | 31.3% |
| H1 FY2026–27 contribution | 39.6% |
| H1 previous-year contribution | 33.7% |
| Three-year target | Approximately 50% |
Merger Aims to Improve Operational Efficiency
The proposed amalgamation is intended to bring Heritage Novandie Foods more closely within Heritage Foods’ existing organisational and operational framework. Greater integration could help streamline management processes, improve resource utilisation and reduce administrative complexity.
Executive Director Brahmani Nara said the proposed amalgamation is designed to strengthen the company’s value-added dairy platform, enhance operational efficiency and support its next phase of growth.
The integration of Livo’s yogurt operations with the parent company’s wider distribution network could also support the brand’s market development. However, the extent of the benefits will depend on how effectively the merger is implemented and how the business performs after integration.
Diversification Beyond Conventional Dairy Products
Heritage Foods operates across multiple dairy categories, including milk, curd, butter, paneer, yogurt and other dairy products, with operations across 13 states. Its focus on value-added products reflects an effort to expand beyond conventional liquid milk sales and develop a broader branded dairy portfolio.
Yogurt and other differentiated dairy products can provide companies with opportunities to serve varied consumer preferences, strengthen brand recognition and broaden their product offerings. Their growth also places greater emphasis on distribution, product development, quality management and operational execution.
For the wider Indian dairy industry, Heritage Foods’ proposed merger highlights the importance of organisational integration alongside product diversification. Dairy businesses are increasingly looking to build stronger consumer-facing brands and expand their presence in categories beyond liquid milk.
The proposed amalgamation of Heritage Novandie Foods with Heritage Foods represents a strategic step towards these objectives. With value-added products already contributing a growing share of revenue, the company’s progress towards its three-year target will be an important indicator of how effectively it can translate its portfolio strategy into sustained business growth.