Milk Revolution
Aug 08, 2015
Milk Revolution
Major PlayersParag Milk
Foods
Heritage
FoodsAmul
Mother Dairy
Danone Foods & Bevera
ges
Nestle
Andhra Pradesh Dairy
Development Co-operative Federation
Fonterra
Tirumala Milk
products
Creamline Dairy Products
Rajasthan Co-
operative Dairy
Federation
Milkfed Punjab
Co-operative
s
Dairy Market
Rabobank expects the organized dairy market to more than double from the current $10 Billion(app 60000 crores)to $ 24 Billion(144000 crore)by 2020
The demand for milk is likely to reach 180 million tonne by 2022 from the current 128 million tonne
(NDDB)
To supply to the market average incremental increase of 5 Mn tonne/annum over the next 15 years would be needed
Milk Mania
Product Portfolio
Milk Powder
Milk
Creamline Dairy
Products
Rajasthan Co-operative
Dairy Federation
Ghee
Cheese
Gulab Jamun
Dahi/Yoghurt
Dairy WhitenerChass
Parag Milk Foods
Bread Spreads
MilkChees
e
UHT Milk
Beverage
Range
AMUL Pro
Ice-Crea
m
Paneer
Dahi
Ghee
Milk Powders nutramul
Mithai Range
Mithai Mate
Chocolates
Fresh Cream
Pouch Butter Milk
AMUL
Milk Products-
FreshMilk
Milk Products-Long Shelf Life
Ice-Cream
Beverages
Heritage Foods
Flavored Milk
Ghee
Basundi Butter
Sweets
Paneer
Tirumala Milk Products
Milk powder Curd Butter
Milk
Lassi Junnu
Ice-Cream
Milk Tetra Pack
Problems faced
High Investment 250-300 Crores required to set up a
plant that can produce 5-6 lakh liters of milk per day
Inadequate Livestock population in India
1950-155 million 2010-199 million
Low margin on Liquid Milk Business A dairy player makes just about 4-5%
margin
Low yielding Indian cows The yield of Indian cows at 1600 kg per
annual lactation is close to negligible compared with the global average of 9000 per annual lactation.
Break-even after a long time Ex:Parag Milk Foods took 6-7 years to
break-even the business
Value-Added Products
Ghee
Paneer
Milk Powder
Ice-Cream
Yoghurt
Butter
Cheese
Case Study-Parag Milk Foods
Introduced in 2008More
consumption of cheese
Demand due to International Pizza
Chains entering India
• 48% market share in premium cheese segment
• Parag Milk Foods has decided to increase their cheese capacity to 100 million tonne.
Cheese Segment
Founded in 1973Founder-Varghese KurienMilk Man of India)Parent-GCMMF
GCMMF-An overview
Members-17 District Cooperatives Milk producers Union(16 Members+1(Nominal Member)No of Producer members-3.18 MillionNo of Village Societies-16914Total Milk handling capacity-16.8 Million litres/dayMilk Collection-12.7 Million liters(on an average-2012-13)Cattlefeed Manufacturing capaity-5890 mts/daySales Turnover-Rs.13735 Crores(2012-13)(US $2.54 Billion)
THE RETURN ON VALUE ADDED PRODUCTS(VAP) (AMUL CASE STUDY)
Offices across nation
Effects of VAP on Milk
• Atleast 30% of the Milk procured by 2018 will come from outside Gujarat
• AMUL sells 15 lakh units of Packaged Lassi & Butter Milk daily
• AMUL started sourcing Milk outside Gujarat from states such as Maharashtra Rajasthan,Uttar Pradesh,Madhya Pradesh,Haryana(Due to demand in VAP)
External Investors
Motilal Oswal PE -60 Cr (2008)
IDFC PE-155 Cr(2012)
IFC-27.9 Cr(2008)
Kotak Ventures-35 Cr(2008)
Premji Invest(2013)
BritanniaIndia
Agribusiness Fund-140 Cr(2013)
Hatsun Agro-65 Cr(2013)
Parag Milk Foods
Modern Dairies Heritage Foods
Fonterra Prabhat DairyJyothi Dairy
Tirumala Milk Products
Carlyle-119.4 Cr(2009)
Indocon Agro
Nestle(2013)
Neo Anurena TristarAmbit
Pragma(2012)
Karnataka Milk Federation Brand “Nandini”
It is the second largest dairy co-operative amongst the dairy cooperatives in the country
KMF has 13 Milk Unions
Product Portfolio
Curds & other
fermented products
Milk Milk Powd
er
Ghee &
Butter
Ice-Cream & Frozen
Desserts
Milk Sweet
s
ChocolateUHT
Milk
Anup George RebelloAsst.Manager
The Catholic Syrian Bank Ltd