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Parag Milk Foods invests Rs 100 cr. Go Fruit yoghurt in six variants to spur future growth
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Thursday, 11 November, 2010, 08 : 00 AM [IST]
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MV Chandrashekar, Bangalore
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Parag Milk Foods has pumped in Rs 100 crore to set up milk and cheese facilities in Andhra Pradesh and Maharashtra. The products are sold under the brand name ‘Gowardhan’ and ‘Go’ range covering an entire spectrum of milk, skim milk powder, ghee, processed cheese, butter, dahi and proprietary foods like dairy whitener and gulab mix powder.
Of the Rs 100 crore, Rs 60 crore was sourced through Motilal Oswal Private Equity Advisors Pvt Ltd. to set up the milk plant at Palamner, Chitoor district in Andhra Pradesh. The company invested Rs 40 crore sourced through internal accruals to establish a cheese facility at Manchar, 60 km from Pune. There was already a milk facility at the location. The company claims the facility is the largest cheese plant in Asia.
The Palamner plant for milk has a capacity of 5 lakh litres per day with provision to double the capacity. The focus of production other than milk would be its value added versions like ghee, curd (dahi) and its new product ‘Go Fruit-fusion.
The company initiated a soft launch in Bangalore on Wednesday of its novel product Fruit-Dahi fusion known as ‘Go Fruit ’ in six variants of mango, pineapple, mix berry, litchi, banana and strawberry priced at Rs 20 for 125 gram. The product is made from cent per cent cow’s milk with no artificial flavourings with a shelf life of 15 days and is positioned as a ‘pick-me- energizer’.
The market is pegged at 50 tonnes and Nestle is the key player in the segment with a national presence along with Amul which also has flavoured yoghurt. Nilgiris too has a similar offering marketed out of its own outlets. Therefore, Go Fruit will have an edge in the segment, stated Rahul Akkara, vice-president, marketing, Parag Milk Foods.
The flavoured and fruit dahi segment has clocked a 30 percent year-on-year growth which indicates the product acceptability. Our product is already available in outlets at Mumbai and has shown a positive response. In Bangalore, since 70 per cent of the sales occur at modern retail outlets, the company will embark on a product sampling sessions at corporate offices, clubs among other locations. In the last 15 days, Parag has managed to register sales to the tune of one tonne with Go Fruit. A unique feature is the offering of a foldable plastic spoon in the pack.
The company is also known for its mozzarella cheese used by leading pizza outlets including Domino’s and US Pizza. It is also the largest exporter in the country for mozzarella cheese, about 250 tonnes to Hong Kong, Korea and Philippines. To the US, ghee in 500 grams and one litre jars are exported, informed VPS Malik, general manager, (sales-institution), Parag Milk Foods.
Sharing the future growth efforts for Parag, Akkara stated now the focus would be the southern markets of Chennai, Hyderabad and Bangalore. Currently, the company sources milk from the one lakh farmers in Maharashtra and will make efforts to identify many more from the agrarian community. There are also 3,500 Jersey cows at Manchar and plans are under way to launch premium quality milk in certain parts of the country. It is also offering its facility for contract production of Dahi and cheese for Britannia.
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