💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue grew 9.35% YoY to INR 3,432.21 Cr in FY25. In H1 FY26, Core categories (Ghee, Cheese, Paneer) grew 19% YoY to INR 1,099 Cr, New age business (Pride of Cows, Avvatar) grew 68% YoY to INR 167 Cr, Liquid milk grew 8% YoY to INR 182 Cr, and Ingredients/SMP decreased 11% YoY to INR 245 Cr.

Geographic Revenue Split

Not disclosed in available documents, though the company has a subsidiary, Parag Foods Middle East FZE, which is yet to commence operations.

Profitability Margins

Gross Profit reached INR 885 Cr in FY25. Gross Margin improved from 23.6% in Q2 FY25 to 25.8% in Q2 FY26. Net Profit Margin (PAT %) improved from 3.4% in Q2 FY25 to 4.5% in Q2 FY26.

EBITDA Margin

Consolidated EBITDA margin was 8.5% (INR 293 Cr) in FY25, up 130 bps from 7.2% in FY24. In Q2 FY26, EBITDA margin was 8.9% (INR 89 Cr) compared to 8.8% in the previous year.

Capital Expenditure

Not disclosed as a specific future INR value, but the company highlights ongoing R&D investments and capacity management of 15 lakh litres of milk daily.

Credit Rating & Borrowing

Net Debt reduced by INR 125 Cr during H1 FY26 to INR 436 Cr. Finance costs for FY25 were INR 93.12 Cr, up from INR 79.40 Cr in FY24 due to higher operations.

⚙️ Operational Drivers

Raw Materials

Milk (primary raw material), packaging materials, and logistics services. Milk procurement averages 15 lakh litres daily.

Import Sources

Sourced through a direct procurement network and relationships with farmers and aggregators, primarily in India.

Key Suppliers

Not specifically named; procurement is handled through a network of farmers and aggregators.

Capacity Expansion

Current capacity allows for the management of 15 lakh litres of milk daily. Planned expansion is focused on increasing cheese production to provide raw materials for the high-growth protein segment.

Raw Material Costs

Raw material costs are subject to price volatility. In Q2 FY26, the company faced a 16% YoY inflation in cost push (milk collection, packaging, and logistics).

Manufacturing Efficiency

Improved product mix and operational efficiencies contributed to a 130-basis point expansion in EBITDA margin in FY25.

Logistics & Distribution

Logistics costs are part of the 16% YoY cost push experienced in Q2 FY26; specific distribution cost % not disclosed.

📈 Strategic Growth

Expected Growth Rate

16%

Growth Strategy

The 'Parag 2.0' journey focuses on premiumization, increasing the B2C revenue mix (currently 70%), and expanding the 'New Age' protein segment (Avvatar). The company is leveraging its #2 position in cheese to secure raw materials for whey protein production, which grew 68% in H1 FY26.

Products & Services

Ghee, Cheese, Paneer, Liquid Milk, Whey Protein (Avvatar), and Premium Milk (Pride of Cows).

Brand Portfolio

Pride of Cows, Avvatar, and branded cow ghee/cheese products.

New Products/Services

New age business (Pride of Cows and Avvatar) now contributes 9% of overall revenue, up from 6% in the previous year.

Market Expansion

Expansion into the Middle East via Parag Foods Middle East FZE and deepening penetration in HoReCa and modern trade segments.

Market Share & Ranking

Market leader with #1 position in branded cow ghee (22% share) and #2 position in cheese (35% share).

Strategic Alliances

Fourth consecutive year of brand association with the television show KBC (Kaun Banega Crorepati) for high visibility.

🌍 External Factors

Industry Trends

Shift toward value-added dairy (VADP) and health-focused protein products. The industry is evolving from loose milk to branded, packaged dairy products.

Competitive Landscape

High industry competition from both organized and unorganized players; Parag competes through premiumization and a differentiated value proposition.

Competitive Moat

Moat is built on brand equity in core categories (#1 in Ghee, #2 in Cheese) and a robust direct-to-farm procurement network that ensures quality raw material for premium products like Avvatar.

Macro Economic Sensitivity

Highly sensitive to food inflation, specifically milk prices, which saw a 16% YoY increase in Q2 FY26.

Consumer Behavior

Increasing consumer preference for premium, branded, and health-oriented dairy products like whey protein and farm-to-home milk.

Geopolitical Risks

Macroeconomic factors like political changes and currency fluctuations are monitored as part of the economic risk mitigation strategy.

⚖️ Regulatory & Governance

Industry Regulations

Compliant with SEBI (SBEB) Regulations 2021 for ESOPs and Section 129 of the Companies Act for financial reporting.

Environmental Compliance

Not disclosed in absolute INR values.

Taxation Policy Impact

Consolidated Profit After Tax for FY25 was INR 118.79 Cr after accounting for deferred tax of INR 14.99 Cr and MAT credit of INR 1.19 Cr.

⚠️ Risk Analysis

Key Uncertainties

Raw material price volatility (milk) and the ability to maintain margins during inflationary cycles (16% cost push).

Geographic Concentration Risk

Not disclosed, but operations are primarily domestic with an emerging Middle East presence.

Third Party Dependencies

Dependency on a network of milk aggregators and farmers for 15 lakh litres of daily procurement.

Technology Obsolescence Risk

Cyber risk and information security are identified as key categories in the Risk Management Framework.

Credit & Counterparty Risk

Debtor days are stable at 28 days, indicating consistent receivables quality.