Mother Dairy is no more a Delhi/NCR-centric brand. Having started off the national expansion plan, the company’s dairy products will be available in almost all the states in one year. The brand will also enlarge its basket of milk-based products by adding dry milk products and more regional milk-based sweets.
Value-added milk products contribute Rs 700 crore to the Rs 5,500 crore Mother Dairy Fruit and Vegetable. According to Subhasis Basu, business head of dairy products, the segment has been growing at a CAGR of 30 per cent over the past two years. “We expect the segment to grow at the same CAGR for the next four to five years and touch a turnover of Rs 2,000 crore,” he said.
In the past few months, Mother Dairy has been actively launching its ice-creams in most of the north, west and some of the eastern states. The product is now being rolled out in the southern states as well.
In the Rs 1,800 crore ice-cream market, currently dominated by Amul and Kwality Walls, Mother Dairy wants to be at the top slot in five years.
Further, the company is working on making its other milk-based products available across the country. “Ice-creams and fresh dairy products need separate supply chains as the latter has a shorter shelf life. While ice-creams can be supplied far due to the longer shelf life, fresh products like curd, flavoured milk, yogurt and other sweetened milk products need production hubs in every region. Local procurement and production ensures the quality and freshness of the products and also cuts cost on logistics,” said Basu.
The company is in the process of launching regional production units for fresh dairy products and providing end-to-end cold chain solution for both ice creams and fresh milk products. The company would either set up its own facilities, add production lines to existing ones or make use of vendor units as per the availability in each market. In the south, it owns a unit for liquid milk in Tirupati and has a 60-acre property for vegetables and fruits in Bangalore.
“Ice-creams and fresh dairy products contribute 50:50 to the turnover of the segment. Even as the segment grows to a size of Rs 2,000 crore, the ratio should remain almost the same. However, the scope for growth in fresh dairy products is higher as the portfolio will get bigger in the coming days with the addition of new products,” said Basu.
Milk powder is one product the company is exploring currently. Further, it wants to introduce more regional milk and curd-based delicacies to appeal to different markets.