Synopsis: Dodla Dairy reported its highest-ever quarterly revenue of Rs. 1,197.9 crore in Q1 FY27, driven by strong milk procurement, robust growth in value-added products and improving sales volumes. While higher milk procurement prices weighed on margins, the company continued expanding through acquisitions, capacity additions and new product launches to support long-term growth.
Shares of Dodla Dairy Limited are likely to remain in focus after the company reported its highest-ever quarterly revenue for Q1 FY27, supported by double-digit growth in milk procurement, higher sales volumes and strong demand for value-added dairy products. Alongside its financial performance, the company continued executing an aggressive expansion strategy through capacity additions, acquisitions and new product launches.
Dodla Dairy Limited has a total market capitalization of approximately Rs. 6237 crore. The company’s shares were trading at Rs. 1039 apiece on the stock exchange, down by 2.08 percent. The stock has declined 3.90 percent over the last five trading sessions and declined 7.33 percent over the past month. It touched a 52-week high of Rs. 1500 and a 52-week low of Rs. 964.
Q1 FY27 Financial Performance
Dodla Dairy reported consolidated revenue from operations of Rs. 1,197.9 crore in Q1 FY27, registering a 19 percent YoY growth from Rs. 1,006.9 crore in the corresponding quarter last year. This marks the highest quarterly revenue in the company’s history.
Gross profit increased to Rs. 278.3 crore, up 7.2 percent YoY, although the gross margin moderated to 23.2 percent from 25.8 percent due to elevated milk procurement costs. EBITDA stood at Rs. 64.9 crore, while the EBITDA margin came in at 5.4 percent. Net profit declined 35.4 percent YoY to Rs. 40.6 crore, primarily because raw milk prices, employee costs, transportation expenses and packaging material costs increased faster than selling prices during the quarter.
One of the biggest positives during the quarter was the strong growth in operational volumes. Milk procurement reached a record 21.1 lakh litres per day (LLPD), growing 13 percent YoY, while milk sales increased 14.5 percent YoY to 13.6 LLPD. Higher procurement ensures the company has sufficient milk availability for future demand while strengthening relationships with farmers.
The company also witnessed exceptional traction in its value-added products (VAP) portfolio. Sales of value-added products rose to Rs. 414.7 crore, contributing 34.6 percent of total revenue. Curd volumes surged 41.4 percent YoY to their highest-ever level, while products such as buttermilk, flavoured milk, paneer, lassi and ice cream delivered strong growth during the extended summer season. These products generally earn better margins than plain milk and improve the company’s long-term profitability.
Why did profits decline despite higher revenue?
Although revenue reached a record high, profitability came under pressure because milk procurement prices increased much faster than the prices charged to customers. The average milk procurement price increased 10.4 percent YoY to Rs. 41.3 per litre, while realization prices rose only 3.9 percent to Rs. 59.4 per litre. Additionally, employee costs increased following changes in labour regulations, transport and fuel expenses rose due to a higher share of liquid milk sales and packaging material costs surged nearly 48 percent because of geopolitical factors and changes in product mix.
Management believes these pressures are temporary and expects procurement prices to gradually normalize from the second quarter as milk supply improves across the industry.
Expansion strategy remains aggressive
Despite near-term margin pressure, Dodla Dairy continues investing aggressively for future growth. The company has announced a Rs. 590+ crore capital expenditure plan between FY26 and FY28 to significantly expand its manufacturing capacity and strengthen its distribution network. A major part of this investment includes a Rs. 280 crore greenfield dairy project in Maharashtra, which is expected to become operational by the end of FY27 and add 10 LLPD of processing capacity. The facility will initially focus on skimmed milk powder and butter before expanding into higher-margin value-added products and cattle feed.
The company is also expanding internationally through a greenfield dairy project in Uganda with a planned investment of Rs. 60 crore, while continuing to strengthen its African operations. In addition, it recently acquired OSAM Dairy for Rs. 247.2 crore, enabling its entry into fast-growing markets such as Bihar and Jharkhand while improving its presence in eastern India.
During the quarter, the Board approved an investment of approximately Rs. 11.6 crore for a 2 percent stake in Sids Farm Private Limited, a fast-growing direct-to-consumer premium dairy brand. This investment supports Dodla’s strategy of expanding into premium dairy categories and strengthening its presence in urban markets.
The company also launched several new products, including new ice cream variants, flavoured milk and Sabja lassi, further strengthening its premium product portfolio and increasing its focus on higher-margin categories.
Incorporated in 1995, Dodla Dairy Limited is an integrated dairy company headquartered in Telangana. The company procures milk across five states and markets branded milk and value-added dairy products across 11 states. Its product portfolio includes milk, curd, butter, ghee, paneer, cheese, flavoured milk, yogurt, lassi and ice cream. Dodla operates an extensive procurement and processing network comprising milk chilling centres, processing plants and distribution infrastructure, while also expanding through acquisitions and international operations in Africa.
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