To set up a processing plant with a capacity of 8-10 lakh litres of milk per day
Parag Milk Foods, a Maharashtra-based dairy firm, is planning to raise Rs.400-500 crore in the next three years for its pan-India expansion.
The expansion includes setting up a processing plant with a capacity of 8-10 lakh litres of milk a day in the eastern or north-eastern part of the country.
It has so far received investments of over Rs.300 crore from IFC, IDFC and Motilal Oswal. While IDFC put in Rs.150 crore, IFC chipped in with Rs.90 crore and the latter Rs.75 crore.
The firm, which set up its second dairy plant at Palamaner in Andhra Pradesh with an investment of Rs.200 crore, is looking at similar investments in the third plant. It has a facility at Manchar in Maharashtra.
The company, however, has not decided yet to raise the funds through the PE route or through an initial public offering. “We are looking at a time frame of three years to raise the funds. Our internal accruals would do for the ongoing expansion plans,” Devendra Shah, Chairman of Parag Milk Foods, said. The firm targeted a turnover of Rs.2,100 crore in 2015-16 against Rs.1,450 crore last year.
Addressing a press conference here on Tuesday, he said the Rs.80,000-crore dairy market in the country offered good scope for value-added products.
“We are aiming to become a top-5 dairy firm in the next three-five years. We are focused on valued dairy products that contribute 80 per cent of the turnover,” he said. The firm targets a contribution of Rs.200 crore from Andhra Pradesh and Telangana.
Parag Milk Foods’ Chief Marketing Officer Mahesh Israni said that the company planned to increase its capacity to three million litres a day in the next three years.
Business Line
