Indian processor invests ₹20 crore at Patiala plant and targets ₹30 crore in contract manufacturing revenue following ₹130 crore Moradabad asset sale.
Indian dairy processor Milkfood Limited is expanding its presence in the fast-growing premium dairy market with plans to launch ghee produced exclusively from A2 milk. The strategic move aims to capture shifting consumer preferences in India toward differentiated, clean-label dairy products positioned around heritage provenance, premium quality, and traditional food practices, allowing the company to improve realisations and pivot away from pure volume-led commodity margins.
The A2 ghee rollout forms the cornerstone of Milkfood’s broader corporate roadmap for FY2026-27, which combines premium product innovation with manufacturing upgrades, operational efficiency, and financial discipline. Alongside consumer-facing branded growth, the company is scaling its third-party contract manufacturing (job work) business, projecting roughly ₹30 crore in revenue from this segment during the fiscal year to optimize asset utilization across its processing network.
To support the value-added expansion, Milkfood is executing a ₹20 crore capital expenditure program at its primary manufacturing complex in Patiala, Punjab. The investment includes establishing a dedicated butter processing facility equipped with advanced manufacturing infrastructure, including a Continuous Butter Machine (CBM) and a specialized temperature-controlled butter cold room to increase operational flexibility and throughput.
The capital expansion follows a successful asset monetization completed in FY2025-26, when Milkfood divested its Moradabad processing facility at Agwanpur, Uttar Pradesh, for approximately ₹130 crore. The proceeds were deployed to pay down institutional debt, strengthen working capital liquidity, and fund new processing lines at the centralized Patiala hub to create a more resilient balance sheet.
In tandem with capacity expansion, the processor is advancing sustainability and energy-saving measures at its Punjab facility. Milkfood is transitioning its industrial boiler fuel from conventional rice husk to parali (paddy straw agricultural residue) to lower thermal energy costs while utilizing local agricultural waste, backed by a 500 kWp rooftop solar plant for captive power generation as it targets approximately ₹17 crore in Profit After Tax (PAT) for the fiscal year.
Source: Moneycontrol
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