Parag Milk Foods Reports Strong Financial Performance for Q2, 2023

Despite the high festive base in the previous year, PMFL's core categories displayed healthy volume and value growth, attributed to innovative branding and an expanded distribution base. Stabilized procurement prices and an improved product mix contributed to a 220 basis point expansion in the Gross Profit Margin (GPM), leading to an EBITDA margin expansion of 160 basis points year-on-year, reaching 7.3%.

The company's overall business health remained strong, with a healthy cash flow from operations of ₹489.3 million for the first half of the fiscal year 2023.

PMFL's strategic brand integration with Kaun Banega Crorepati (KBC) strengthened consumer connections and expanded distribution reach. The collaboration with KBC is expected to enhance reach in tier 2 and tier 3 towns and cities.

Devendra Shah, Chairman of Parag Milk Foods, expressed delight in achieving a healthy revenue growth driven by volume growth and product premiumization. The company is confident in sustaining growth momentum with a positive outlook for profitability in the coming quarters.

Shah also highlighted the company's business transformation drive, partnering with Boston Consulting Group (BCG) to unlock new avenues for growth and streamline operations for long-term sustainability.

Key highlights from core categories include continuous traction in ghee and cheese, posting a growth of 6.2% year-on-year. The Direct to Consumer (D2C) brand Avvatar recorded robust growth of 62.7% year-on-year, driven by a 57% increase in volume. The overall protein portfolio marked market share gains.

The brand Pride of Cows, aligned with the premiumization agenda, continues to witness healthy traction, expanding its product portfolio and distribution footprint. The average milk procurement for the quarter stood at 15 lac litres per day, supported by a stable global market and a good flush season, resulting in stabilized milk prices at ₹35.6 per litre.