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Parag Milk Foods records gross profit of Rs 749 crore in FY24

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The company’s profit after tax stood at 91 crore in FY24 showing 70% YoY growth compared to up PAT of Rs 53 crore in FY23

Bengaluru: Parag Milk Foods Ltd., a manufacturer and marketer of dairy-based branded products in India, has recorded a gross profit (GP) of Rs 749 crore in in the fiscal year (FY) 2024, with a GP margin of 23.9%, compared to Rs 569 crore in FY23 with a GP margin of 19.7%, the company said in a press release on Monday. It led to a 4.2% increase in the overall year-on-year gross profit margin.

The company’s profit after tax stood at 91 crore in FY24 showing 70% YoY growth compared to up PAT of Rs 53 crore in FY23. Additionally, the brand  achieved its highest-ever revenue of Rs 3,139 crore in FY24, marking an 8.5% year-on-year (YoY) growth compared to FY23.

“It gives me immense pleasure to state that our consolidated revenues for FY24 have crossed the milestone of Rs 3,000 crore; along with improvement in margins and profitability. The profit after tax for the year was at Rs 91 crore, with healthy operating cash flows of Rs 99 crore,” said Devendra Shah, chairman of Parag Milk Foods Ltd.

“Over the last few quarters, the milk procurement prices have been benign, and now we expect an upward bias. Despite tailwinds; we are geared up for improving our margin profile,” he added.

Earnings before interest, taxes, depreciation and amortisation (EBITDA) amounted to Rs 222 crore with a margin of 7.1%, compared to FY23’s EBITDA of Rs 163 crore and a margin of 5.7%, resulting in an overall year-on-year EBITDA margin expansion of 1.4%.

In the third quarter of FY24, the company reported revenue from operations of Rs 790 crore and a gross profit (GP) of Rs 194 crore, achieving a GP margin of 24.6%. The EBITDA for the quarter was Rs 44 crore, with an EBITDA margin of 5.6%, and the profit after tax stood at Rs 10 crore.

The company continues to invest in brand building, with overall advertising and promotion spending at 4.2% of revenue for FY24, compared to 2.5% in FY23.

Core categories of ghee and cheese have seen continuous traction throughout the year and have posted a growth of 3.5% YoY. The overall business growth was broad-based with all the distribution channels contributing to the performance. For FY24, the general trade, modern trade and e-commerce posted a growth of 3% YoY and 6% YoY, respectively.

Its consumer brand Avvatar is growing at a 100% compound annual growth rate (CAGR) for two years in a row. 

Recently, the company ventured into the sweets category, under the brand name Gowardhan. “We would continue to enhance our industry-leading research and developments capabilities and infrastructure to drive innovation and delight our consumers across the globe. Our forward integration of the brand ‘Gowardhan’ into the traditional sweets category is an initiative in this direction,” said Shah.

In line with the company’s premiumisation agenda its brand Pride of Cows is aggressively expanding its product portfolio as well as distribution footprint and now is present across seven cities. The company is expanding its subsidiary Bhagyalakshmi Dairy Farm which supplies exclusively under the ‘Pride of Cows’ brand.

The average milk procurement stood at 16 lakh litres per day, aided by a stable global market and a good flush season, resulting in stabilised milk prices. For FY24, the average milk price stood at Rs 33.8 per litre.

“We are inching up on our business process transformation along with driving efficiency across the value chain. With an ensuing expansion and acceleration of the distribution footprint, we plan to incorporate a foreign wholly owned subsidiary in Dubai, to cater the international market,” Shah added.

Founded in 1992, Parag Milk Foods claims to be the largest private dairy FMCG company with a pan India presence. Its manufacturing facilities with in-house technology are located at Manchar in Maharashtra, Palamaner in Andhra Pradesh and Sonipat in Haryana. 

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