Private equity backed dairy firm Parag Milk Foods has earmarked Rs 120 crore ($19.5 million) for its expansion plan for the coming financial year where it is aiming to up its production capacity by over a third to 27 lakh tonne per annum.
This would be a significant ramp up from Rs 75 crore that it has already invested for expansion during FY15.
Parag Milk Foods is currently exporting a fifth of its output to a clutch of over two dozen countries and aiming to increase its export share further in FY16. The firm wants to expand its presence in Gulf countries and Singapore, in particular.
The firm is also expanding the basket of its value added products and as part of it entering healthy beverages segment with whey protein drinks. It is also entering milk cream category under GO Cream brand.
The dairy firm has also appointed Bharat Kedia as chief financial officer (CFO) after Manoj Saraf quit to join Future Consumer as head of the finance wing.
Kedia comes after a stint at Publicis Group. Prior to that he served in the finance unit of several country and regional units of beverage giant Coca Cola in Europe.
Meanwhile, the firm has also unveiled a new logo. “Many people did not know that certain brands belonged to our company hence this logo will represent our matured identity,” said Devendra Shah, chairman of Parag Milk Foods.
Established in 1992 by Shah, Parag is one of India’s largest private dairy companies. The firm produces liquid milk and value added products like UHT milk, cheese, butter, ghee (clarified butter), paneer (cottage cheese), yoghurt, curd, lassi, flavoured milk, dairy whitener and milk powder, which are sold under the brands ‘GO’, ‘Gowardhan’ and ‘Top Up’.
In September 2012, IDFC Alternatives invested $29 million in Parag Milk Foods in a deal which also saw previous investor Motilal Oswal Private Equity make a partial exit on its four-year-old investment. The PE firm had invested Rs 55 crore in Parag back in 2008 through its India Business Excellence Fund.
The company was previously looking at an IPO but does not have any immediate plans and expects strategic sale for the PE investors who have invested in it.
One year ago Lactalis bought Tirumala Milk in the largest acquisition deal in the dairy space in the country. It is also said to have opened the market for more such strategic sales, especially for many PE-backed private dairy firms.
(Edited by Joby Puthuparampil Johnson)