Shares of Heritage Foods fell another 5% today to ₹627.30 apiece, extending their downward trend for the third consecutive session as investors engaged in profit booking. The company’s shares had recently gained attention for their remarkable performance, soaring 70% in just seven sessions between June 4 and June 10.
This dramatic rise was closely tied to the political landscape, as optimism surged following the Telugu Desam Party (TDP) securing a significant majority in the 2024 Andhra Pradesh assembly elections.
The stock’s rally began immediately after exit polls projected the return of N. Chandrababu Naidu, the founder of Heritage Foods, as Chief Minister of Andhra Pradesh.
The TDP’s alliance with Pawan Kalyan and the BJP resulted in a record 164 seats, leaving the ruling YSRCP with just 11 seats out of the 175 total in the state assembly. Consequently, the YS Jagan-led party even lost the status of opposition in the assembly, as a party needs at least 18 seats to attain this status.
This landslide victory not only propelled the stock but also significantly bolstered the family’s fortunes. The TDP, led by Naidu, has also been instrumental in forming the central government, holding the second-highest number of MP seats in the NDA after the BJP.
Despite Chandrababu Naidu not directly owning a stake in Heritage Foods, the strong connection between his political success and the company’s performance has been evident in the market’s reaction.
Naidu family members, including Bhuvaneswari Nara (wife), Nara Lokesh (son), N. Brahmani (daughter-in-law), and Devaansh Nara (grandson), along with other promoters, collectively hold a 41.3% stake in the company as of Q4FY24, according to Trendlyne data.
Meanwhile, Chandrababu Naidu is set to take the oath as Chief Minister of Andhra Pradesh along with the 24 ministers in his cabinet today, June 12. The event will be held at 11:27 a.m. at Kesarapalli IT Park near Gannavaram airport in Krishna district.
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