PARAGMILKNSEQ1FY26July 26, 2025

Parag Milk Foods Limited

9,147words

123turns

14analyst exchanges

3executives

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Management on call

Akshali Shah

EXECUTIVE DIRECTOR – PARAG MILK FOODS LIMITED

Rahul Kumar Srivastava

CHIEF OPERATING

Ankit Jain

CHIEF STRATEGY OFFICER– PARAG MILK FOODS LIMITED

Key numbers — 40 extracted

INR 852 crore

ong and promising tone for the year ahead. We delivered our highest ever first quarter revenue of INR 852 crores, reflecting a 12% Y-o-Y growth backed by consistent execution of our focus strategic priority.

12%

e year ahead. We delivered our highest ever first quarter revenue of INR 852 crores, reflecting a 12% Y-o-Y growth backed by consistent execution of our focus strategic priority. This growth was dr

robust volume expansion across our core categories that is cheese, ghee and paneer, which grew by 9% in volume and 14% in value. These categories now contribute to 57% of our total revenue, affirmin

14%

ansion across our core categories that is cheese, ghee and paneer, which grew by 9% in volume and 14% in value. These categories now contribute to 57% of our total revenue, affirming their strength i

57%

ghee and paneer, which grew by 9% in volume and 14% in value. These categories now contribute to 57% of our total revenue, affirming their strength in our portfolio. We continue to retain leadership

22%

rength in our portfolio. We continue to retain leadership position with Gowardhan ghee commanding 22% market share in branded cow- ghee segment and Go cheese holds 35% market share in the cheese categ

35%

n with Gowardhan ghee commanding 22% market share in branded cow- ghee segment and Go cheese holds 35% market share in the cheese category. We have witnessed a strong operational execution despite of

18%

trong operational execution despite of challenging macro factors. Average milk price increased by 18% Y-o-Y to INR 37 per litre, yet we were able to sustain margins and deliver 6% EBITDA growth. With

INR 37

onal execution despite of challenging macro factors. Average milk price increased by 18% Y-o-Y to INR 37 per litre, yet we were able to sustain margins and deliver 6% EBITDA growth. With a margin of 7.7%

price increased by 18% Y-o-Y to INR 37 per litre, yet we were able to sustain margins and deliver 6% EBITDA growth. With a margin of 7.7%, our average milk procurement has now reached to 16.5 lakh l

7.7%

37 per litre, yet we were able to sustain margins and deliver 6% EBITDA growth. With a margin of 7.7%, our average milk procurement has now reached to 16.5 lakh litres per day, marking a 10% increase

16.5 lakh

deliver 6% EBITDA growth. With a margin of 7.7%, our average milk procurement has now reached to 16.5 lakh litres per day, marking a 10% increase over the last quarter. This demonstrates the strength of o

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Guidance — 20 items

Akshali Shah

opening

“We are delighted to share that Q1 FY26 has set a strong and promising tone for the year ahead.”

Akshali Shah

opening

“Our gross profit margins improved sequentially from 25.1% in Q4 FY25 to 27.4% in Q1 FY26.”

Akshali Shah

opening

“Currently it's valued at INR 1,600 crores and it's growing by 30% CAGR.”

Akshali Shah

“Going forward, we are now forayed into a protein snack functional category where we have launched Whey protein bar and we're soon going to expand into products which are similar to that.”

Akshali Shah

“Plus you are talking about exports, the Indian market is growing at almost 30%, 35% CAGR and we see a great potential here in India.”

Kiran D

“I don't have an equivalent number of Q1 FY25 because the company's presentation didn't have it.”

Ankit Jain

“It has remained at 57% of last year versus same as current year Q1 FY26.”

Ankit Jain

“So there is an equal focus on both and hence we do not get into splitting the numbers and in fact there will be additional premium products which are going to come and which will get into this new age business as we move along.”

Ankit Jain

“No, there will be other elements to it as well.”

Bharat Gupta

“So first, can you provide some breakup of revenues in terms of the regional split like what will be the contribution coming in from the North, South, East and West?”

Risks & concerns — 5 flagged

So to give you a regional break-up will be very difficult because we have around five to six route-to-markets which are indifferent in nature.

— Akshali Shah

So to tell you specifically from how much of it is coming from which region would be very difficult to give this break-up.

— Akshali Shah

Just wanted to know on a Y-o-Y basis, there was a marginal decline in the EBITDA percentage due to a higher advertisement and promotion spending.

— Siddharth Vaid

There is a marginal decline and there is a higher Ad pro, which we have specifically called out as per our investor presentation.

— Ankit Jain

But would it be a fair assumption to make that given that your value added products have grown about 50% year-on-year, would your margins have either stagnated or declined marginally, that those entities are currently more of a drag on your margins and the profitability is yet to come?

— Yash Sinha

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Q&A — 14 exchanges

Hi, good evening. Thank you for the opportunity. What I would like to ask is can you elaborate on your Whey protein and sports nutrition strategy? So are you planning any international partnerships or D2C brand expansions in this space?

Akshali Shah

Sorry, your voice was a little foggy. Can you repeat the question? Okay, am I audible right now? Yes, it’s better. Okay, so what I wanted to ask you is can you elaborate on your Whey protein and sports nutrition strategy? So are you planning any international partnerships or D2C brand expansions in this space? Hi, Param. So if you know our Whey protein is probably one of the fastest growing category that we have and we in fact have tailor made and created a Whey protein which is Avvatar and did a lot of research for almost five to six years on developing a product and we did a collab with an i

Hi, thank you so much for the opportunity. I have two clarifying questions.

Management

Okay, perfect. I had two clarifying questions. So just on core categories, we are at INR487 crores this quarter. I don't have an equivalent number of Q1 FY25 because the company's presentation didn't have it. But if I look at Q3 onwards from where you started reporting core category, liquid milk and all that stuff. So core categories was a INR530 crores revenue business. Now in Q1 it is INR487 crores. I am sure we have taken pricing actions, we have increased distribution, we have increased advertising. So what amount of seasonality should we kind of consider because this is actually degrown l

Ankit Jain

Yes, I would like to clarify. Can you see this slide number? I don't know if you have the presentation open. We have this Slide Number 8 where we have given you the previous year breakup as well of core categories. I would like to clarify here. Till last year we were reporting value-added products which was an addition of overall portfolio. So we have classified core categories as ghee, cheese, paneer separately. And we have given the breakup for all the last Q1s for the past four quarter ones. And similarly for the last five years in the similar slide in the investor presentation itself. So o

Yes, thank you for the opportunity. So the first question is if you could just talk about the unit economics of the cow from your BhagyaLakshmi Farm. Typically, let's say what would be the per cow cost, at the time of purchase what would be the lifetime value of the cow, like how many, what would be the yield, potential revenues over the lifetime of the cow? What is the typical lifetime of the cow? And then typically, then what is the residual value of the cow? And a related question would be that on your balance sheet, there are biological assets. So how exactly is the accounting treatment fo

Akshali Shah

Yes, so I think the question was on the yield and the cycle. Rahul Kumar Srivastava: Yes. So we have our own specific needs. So one is that very important for getting the yield. And second is the feeding. So feeding, for feeding we have our own crops, which are converting to silage, which gives a better quality of milk with a better yield per cow. So just to give you the indication that if you the same cow it is in with the farmers, they give out 8 to 10 litres of milk, but in our farm, the average yield goes to 26 litres. So almost three times. So that is that is one with a better protein and

Sure, thank you.

Management

Hi, sorry to correct. It's Bharat Gupta from Fair Value Capital. A couple of questions from my side. So first, can you provide some breakup of revenues in terms of the regional split like what will be the contribution coming in from the North, South, East and West?

Akshali Shah

So to give you a regional break-up will be very difficult because we have around five to six route-to-markets which are indifferent in nature. So to tell you specifically from how much of it is coming from which region would be very difficult to give this break-up. And plus, it's very different for each business category versus if you check the new-age business versus your fresh milk, which is very South and West-centric to Gowardhan and Go cheese, which are very, very different in nature. So we do not share break-up of region-wise. But any market share which you can highlight with respect to

Sure.

Management

Hi, thank you for taking my question. So my first question is about gross margins. So if I look at your listed peers, most of the dairy companies have a gross margin anywhere between 25% to 30%, like high 20s. Whereas we if we look at us, our product mix is mostly on the value added wherein 75% of businesses value add versus 25% being liquid milk or bulk S&P, but still our gross margins are in the similar range of high 20s. So I'm just trying to understand why so, because our value added is like 75% versus 25% for other peers?

Ankit Jain

So, see, while you are comparing versus the listed players, please note that the listed players, there is no direct comparison because most of the listed players are region based players. And they are largely selling milk and curd that to specific geographies, limited geographies as well as largely into ice creams. So if we were to see, there's no direct competition when it comes to ghee or a cheese or the Whey protein kind of products. While your observation is looking at all the financials, but please understand that when we have a Pan India network for these kind of products, there is an in

Good evening. Just wanted to know on a Y-o-Y basis, there was a marginal decline in the EBITDA percentage due to a higher advertisement and promotion spending. So how are you viewing the return on investment on these trends?

Ankit Jain

See, first of all, your observation is right. There is a marginal decline and there is a higher Ad pro, which we have specifically called out as per our investor presentation. How do we look at is more of a return on the Adpro is more on the long term. So we continue to focus on brand building initiatives. That's why we are present across and we are focusing on consumer cheese. We are focusing on Avvatar for all the digital campaigns. There are several campaigns on Pride of Cows. All these get reflected in the of course, the overall revenue growth. And that's where you see the portion on the s

I wanted to broadly understand the variation in gross margin between the core categories. So your core products, your new age products, skimmed milk, etc. Just to kind of understand the movement quarter-on-quarter in your margins?

Ankit Jain

Yes, Yash, I'm sure you will appreciate that the category wise gross margins are core part of the business to operate for the company. And it is maintained at the company level. Even if you were to look at the peers or benchmark, whether Nestle or Marico, you will not be able to get the gross margin at a category level because it is generally the price sensitive information. and of course the company's confidential information. And hence, we would like to abstain from sharing. Okay, that's fair. But would it be a fair assumption to make that given that your value added products have grown abou

Okay. First of all, congratulations to the team, actually. You all have created great brands, which is evident. Now, my question is allow me two minutes to give a context to the question. So, on one hand, we are seeing our B2C channel sales is more than two-thirds. Our value-added product, our contribution to the total revenue again is more than 65%, 70%. Now, this compares to Hatsun of only 30%. While I understand they are regional players and we are national players. But in the previous concall, I think Ankit mentioned that our new-age business actually has more than double the margin of the

Ankit Jain

I would answer each of your questions. See, you started with competition. See, competition is a regional play. Milk has traditionally been a regional play where it is not economical to transport water. So, hence, the dynamics on a regional play with respect to EBITDA margins is absolutely different versus the national player. And that too who spends heavily on the Ad pro, I think make and focusing on building the brand is something a different strategy. So, we are on to maybe you can say a dairy FMCG who wants to create brand, build brand with a focus efforts on brand building initiatives. Als

Thank you very much and all the best.

Ankit Jain

Thank you so much.

Yes, hi there. Thanks for the opportunity. So I just wanted to understand how much of our milk procurement is through agents and how much is from our own distribution network? Rahul Kumar Srivastava: So whatever milk we collect we procure 40% our own and 60% is through agents. And we are trying to increase our own milk procurement because we want to have sustainable milk procurement with the quality. So we are increasing our own milk procurement. So right now it is 40-60, 40 our own and 60%.

Ankit Jain

Also just on a lighter note, both the milk are our own only. From our own network. Rahul Kumar Srivastava: Yes, they are same farmers so it's only just method of channelizing. And the next question, any reason why we have such a higher share from agents? Because what we understand is other players, other listed players majorly procure from their own distribution network which gives them an advantage in pricing and also in terms of supply availability. So why do we have 60% coming from agent network? Rahul Kumar Srivastava: Even if we have what you call it from the other sources, they are just

So a lot of my questions have been answered. So just wanted to just get that. I think in the last call we were thinking like we have a goal of reaching INR10,000 crores revenue. So like I don't want maybe like a short-term guidance, but over the long term we should maintain our guidance like we can grow at 18%, right, sir?

Ankit Jain

Yes. Sorry, you want the breakup of 10,000? Breakup of 10,000? No, I was saying that we have an internal target of, I think, reaching INR10,000 crores revenue. So wanted to know, is that still, like in a play for the next four years or how do we see our revenue growth trajectory, sir? Rahul Kumar Srivastava: This is what we are targeting for next, I would say, next five years from whatever status what we have today. And that is possible because we have all the ingredients to do that. And that's what we have been telling you, the way we are expanding our distribution, the way we are building ou

Speaking time

Ankit Jain

Moderator

Akshali Shah

Resham Mehta

Kiran D

Bharat Gupta

Darshil Jhaveri

Debashish Neogi

Param Vora

Ankush Agarwal

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Opening remarks

Brian D'Penha

Thank you. Good day and good evening to everyone who have joined this call from various geographies and all those who joined us from Mumbai. We have with us today from the Management, Ms. Akshali Shah, our Executive Director, Mr. Rahul Kumar Srivastava, our COO, Mr. Ankit Jain, who is the Chief Strategy Officer and myself Brian D'Penha, Head of Investor Relations. I would now like to hand over the mic to our Executive Director, Ms. Akshali Shah to take this forward.

Akshali Shah

Good evening everyone. It's a pleasure to welcome you all to the Q1 FY26 earnings call for Parag Milk Foods Limited. I hope you and your families are doing well. We are delighted to share that Q1 FY26 has set a strong and promising tone for the year ahead. We delivered our highest ever first quarter revenue of INR 852 crores, reflecting a 12% Y-o-Y growth backed by consistent execution of our focus strategic priority. This growth was driven by robust volume expansion across our core categories that is cheese, ghee and paneer, which grew by 9% in volume and 14% in value. These categories now contribute to 57% of our total revenue, affirming their strength in our portfolio. We continue to retain leadership position with Gowardhan ghee commanding 22% market share in branded cow- ghee segment and Go cheese holds 35% market share in the cheese category. We have witnessed a strong operational execution despite of challenging macro factors. Average milk price increased by 18% Y-o-Y to INR 37

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Parag Milk Foods Limited

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