Market Downturn? Not for Heritage Foods and Amara Raja – Here’s Why
When the market is falling the shares of companies linked to the Telugu Desam Party (TDP), such as Heritage Foods and Amara Raja Energy & Mobility, soared up to 20%. This sharp increase followed reports that TDP chief Chandrababu Naidu is likely to become the Chief Minister of Andhra Pradesh after his party’s sweeping victory in the election.
Additionally, there is news circulated in the media that he might support the National Democratic Alliance (NDA).
Prime Minister Narendra Modi has secured a third term, but the BJP is short of the 272 majority mark by 32 seats and thus relies on the support of other coalition parties, including JD(U) led by Nitish Kumar, and TDP, led by Chandrababu Naidu.
Amara Raja Energy’s stock was trading 12.5% higher at Rs 1,217.55 on the National Stock Exchange (NSE). The company’s managing director, Galla Jayadev (Jay Galla), a former TDP Parliamentary Party Leader, decided not to run in the Lok Sabha elections this year.
He mentioned, “I have decided not to contest in this general election. My family has a legacy of fighting for people, but it’s not easy to manage public life and entrepreneurship simultaneously. So, I have decided to pause my political life.”
He also stated that he would continue contributing to the country’s development by “investing, innovating, creating employment opportunities, and generating revenue and wealth for the nation.”
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Who is the founder of Heritage Groups?
Heritage Group, founded in 1992 by TDP Chief Chandrababu Naidu, operates in dairy, retail, and agriculture under its flagship company, Heritage Foods. Nara Lokesh, Naidu’s son, is one of the promoters of Heritage Foods, which also has a presence in the cattle feed business through its subsidiary, Heritage Nutrivet Limited (HNL).
Heritage Foods produces dairy products like curd, ghee, paneer, and flavored milk.
After the news of Chandrababu Naidu potentially becoming Andhra Pradesh’s Chief Minister for a fourth term shares of Heritage Foods increaed nearly 20% to a record high of Rs 544 apiece on the NSE due to heavy trading volumes.
This year, Heritage Foods’ stock has seen an impressive rally of nearly 80%, significantly outperforming the benchmark Nifty’s 3% return.
