Despite the positive revenue and volume figures, the company’s EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) saw a slight decline of 3.6%, dropping to ₹92.8 crore from ₹96.3 crore in Q2 FY25. The Managing Director, Dodla Sunil Reddy, attributed this temporary margin pressure to the recent acquisition of OSAM Dairy business. Reddy noted that the acquired entity currently operates at lower margins, impacting the overall group profitability, although the acquisition’s contribution was included for two months of the reporting period.

A key factor supporting the profit recovery and volume expansion was a significant shift in Dodla Dairy’s product mix. The company strategically reduced the contribution from bulk sales, instead focusing on growth driven by liquid milk and higher-margin value-added products (VAP). These VAPs include key revenue drivers such as curd, ghee, lassi, flavored milk, and ice cream. This portfolio reorientation resulted in a strong improvement in gross profit, which offset the modest overall revenue growth and the initial margin strain from the OSAM acquisition.

Looking at the broader financial performance, Reddy highlighted the company’s enduring strength, noting that Dodla Dairy has successfully maintained a Compound Annual Growth Rate (CAGR) above 15% in both revenue and EBITDA over the last two years, and an even stronger CAGR over 22% in PAT. This sustained performance underscores the success of the company’s underlying business strategies. Additionally, the company’s non-Indian operations, specifically its Africa segment, along with the Orgafeed segment, continued to demonstrate robust growth, albeit with temporary margin pressures in Kenya due to strategic product pricing designed to gain market share.