Parag Milk Partners TAJSATS Air Catering For Product Supply

Parag Milk is eyeing 10% market share in Delhi-NCR from fresh milk segment in the financial year 2019. The company launched the fresh milk made from 100% cow's milk under the brand Gowardhan in Delhi-NCR region.

Devendra Shah, Chairman of Parag Milk Foods, said, "We are planning to expand our footprint in the Delhi and NCR region in the fresh milk category. We are targeting a 10 per cent market share in the region in the fresh milk segment in the next eight months (August-March)."

Along with Delhi NCR, the company also plans to reach out to the regions within 250-300 km radius of the Sonipat plant. The fresh milk business in the NCR region is worth approximately Rs 1,000 crore.

Shah further said, "North is one of the key priority markets for us. Dairy products consumption is the highest in this region and this expansion will allow us to allow cow's milk reach Delhi-NCR and neighbouring regions."

In the coming weeks, along with fresh milk production, the company will also manufacture products including flavoured milk, buttermilk, lassi, among others. Established in 1992, Parag Milk Foods is a private dairy FMCG company with pan-India presence.

Parag Milk Foods is expecting a dip in revenue growth to up to 15 per cent per annum over the next three years, and will focus on dairy FMCG products in this period.

The company's revenue grew by 17 per cent in the last three years to reach Rs 1,730.7 crore in FY17 and is looking at a CAGR (compounded annual growth rate) of 13-15 per cent in the next three years.

The company is India's largest private dairy with a milk processing capacity of 2 million litres per day.

The future growth will come mainly from traditional products like liquid milk, ghee, paneer and curd, which are expected to grow by 15 per cent, while modern products like UHT milk, flavoured milk, cheese and whey powder may grow by 26 per cent by 2020.

Parag Food plans to increase operation efficiencies by leveraging in-house technological, R&D capabilities and strengthening brands. It is looking at focusing on introducing healthy and nutritious products.

The Union government implemented the Central Scheme National Dairy Plan Phase 1 during 2012-17 to improve productivity of dairy cooperatives through several input activities.

Going ahead, India's milk production is expected to outperform global production and grow at similar 4.2 per cent CAGR going ahead to 185 million MT per annum/507mn litres per day and surpass EU to emerge the largest dairy producer by 2020. It is expected to improve in value terms at 15 per cent CAGR to Rs 9.4 trillion over FY16-20.

The company is betting big on its 100 per cent vegetarian protein product as the country's sports nutrition segment is estimated at Rs 1,500 crore and given the increase in number of health clubs and fitness centres.

UP Chief Minister, Yogi Adityanath stressed on the expansion of milk brand Parag in the state, saying that it can bring prosperity to farmers by increasing their incomes.

Yogi, who took part in a meeting on milk development and dairy farming, said, "For the prosperity of farmers, the Parag milk brand of the state need to be strengthened and developed."

He said, “With popular brand Amul installing more units in UP, it would help the farmers to get better return for their produce and attain self-reliance.”

He also exuded confidence that Amul will lend necessary support for further developing the Parag brand.

He said, "People are ready to even pay more for good milk and if it was made available with the help of dairy processing plants, the market for adulterated goods will die on its own."

He further added that there were immense possibilities for setting up milk processing units in Gorakhpur and surrounding areas.

According to officials, he asked for increasing the capacity of units being set up in Gorakhpur and Varanasi.

R S Sodhi, Managing Director, Amul Dairy, said, "Uttar Pradesh is the biggest milk producing state of the country which is more than double of what is produced in Gujarat."

He said, "Amul has paid Rs 360 crore as milk prices to farmers in UP which is likely to be taken to Rs 3500 crore in the coming years."

Sodhi added, "Amul may provide training and exposure to Parag in every field, including processing and marketing." 

Parag Milk Foods, a dairy company based in Pune, has planned to open 120-150 Gowardhan Shops by the end of FY-16.

It claims to be the second largest share of India's cheese market is available in both packages milk and milk products.

The company is palnning to convert all its existing shops in Maharshtra to uniform format to be designed under Gowardhan Shop.

Mahesh Israni, Chief Marketing Officer, Parag Milk Foods Ltd., said that it is looking forward to open these shops on franchise basis.

It has also planned to expand its existing number of brands from four to seven by the end of next year.

Israni also added, "It will not be just re-branding of the existing Gowardhan dairy whitener. We will be launching an entirely new product of a better quality than the existing one."

Parag will be launching its sixth brand in the category of whey products. "We are about to complete the setting up of a separate factory for the consumer products like protein mix powder," said Devendra Shah, chairman, Parag Milk Foods.

Parag Milk Foods Ltd one of the leading private dairies in India, based in Maharashtra,  launched its fresh cream under the brand name Go, is eyeing household penetration in this largely unorganised segment, apart from institutional sales to drive growth, reported Business Standard.

Parag, which claims to be have a fresh cream product made from cow milk.Fresh cream is a largely unorganised market, with over 85-90 per cent of the market lying in the unorganised segment. The size of the organised market, which is dominated by institutional segment, is estimated to be around Rs 1270 crore and it is growing at a CAGR of 17 per cent between 2007 and 2014.

Devendra Shah, chairman and managing director of the Rs 1500 crore dairy company that is also eyeing to go public in about four to five months time said, "There is huge potential in the fresh cream segment in India as only 20 per cent of the market is organised. There is huge potential to be tapped."

The northern region remains the biggest market for fresh cream with 37 per cent share in total consumption. It is followed by the western & central region with a 26 per cent share, southern region with 23 per cent and lastly the eastern region accounts for 14 per cent share in consumption.

Another significant development, recently Parag has also filed a draft red herring prospectus (DRHP) with the market regulator for its initial public offer (IPO).

Parag has plans to expand its cheese capacity from a current 40 tonnes per day. The cheese market in India is estimated to be about 29,000 tonnes per annum valued at about Rs 850 crore and is clocking a 25 percent growth rate.

Currently, Parag has a 2 million litres per day processing capacity at its two plants Manchar (Maharashtra) and Palamnar (Andhra Pradesh). It procures milk from 23,000 farmers. In FY15 its average milk procurement stood at one million litres per day, growing at 16.5 per cent since 2006.

RI Bureau

Private dairy player Parag Milk Foods has brought Chef Ranveer Brar to promote its Go Cheese and Go Fresh Cream brands.

The brand association has been signed for two years and involves a pan-India communication campaign, stated a release.

To kick start this association the company - its brands include Gowardhan, Go, Pride of Cows and Topp Up - will launch a dedicated YouTube channel and special edition shows, called Good to Go!, on Living Food Channel.

Chef Brar who is presently seen in the Living Food Channel will promote its product through the food he is going to cook on the show.

Today the IPO space is heating up as two firms, Parag Milk Foods and Maini Precision Products, filed draft papers to fund business expansion, reported by PTI.

Both have filed draft documents with markets regulator Sebi to float their initial public offers (IPOs). The public issue of Parag Milk Foods consists of fresh issue of equity shares worth Rs 325 crore and an offer for sale of up to 19,850,000 equity shares.

The net profits are to be utilised for expansion and modernisation as well as investment in subsidiary which will modernise the Bhagyalaxmi Dairy Farm.

The Book Running Lead Managers for Parag Milk IPO are Kotak Mahindra Capital, JM Financial Institutional Securities, IDFC Securities and Motilal Oswal Investment Advisors.

Under the Maini Precision Products' IPO, there would be a fresh issue of equity shares worth Rs 50 crore. Besides, an offer for sale of up to 10 lakh equity shares each would be made by Sudarshan Kumar Maini and Reva Maini.

That apart, up to 9.3 lakh equity shares would be made by Sandeep Kumar Maini and up to 500,000 equity shares each by Gautam Maini and Chetan Kumar Maini. Sudarshan Kumar Maini, Reva Maini, Sandeep Kumar Maini, Gautam Maini and Chetan Kumar Maini are promoters of the company.

The profits of the issue will be utilised for construction of a new building for a manufacturing facility at Nelamangala, for purchase of machinery, part pre-payment of debt and other general corporate purposes.

The Book Running Lead Managers to this Issue are ICICI Securities and IIFL Holdings. The equity shares offered through both the issues are proposed to be listed on the BSE and the NSE.