Parag Milk Foods gains after stellar Q3 performance

Parag Milk Foods (PMFL) gained 1.61% to Rs 240.25 after the company reported a consolidated net profit of Rs 34.16 crore in Q3 FY24, which is nearly four times as compared with the PAT of Rs 9.26 crore recorded in Q3 FY23.

Revenue during the quarter rose by 8.8% YoY to Rs 800.84 crore.

Total expenses increased by 6% to Rs 773.93 crore in the third quarter as compared with the same period last year. This was primarily on account of higher other expenses (up 22% YoY) and higher finance costs (up 35% YoY).

The growth came on the back of healthy growth in the ghee and the protein category. The softness in the milk prices coupled with improving product mix resulted in sharp expansion in the gross profit margin for the company. Gross profit margin expanded by 520 bps on a YoY basis from 21.1% in Q3 FY23 to 26.5% in Q3 FY24.

EBITDA grew by 80.5% YoY, with an EBITDA margin of 8.6% for Q3 FY24 as against 5.2% in Q3 FY23.

Profit before tax in Q3 FY24 stood at Rs 32.76 crore, which is nearly three times the PBT of Rs 10.64 crore posted in Q3 FY23.

For the quarter, the average milk procurement stood at 17 lakh litres per day; aided by stable global market coupled with good flush season; the milk prices have stabilized. For the quarter the average milk price stood at Rs 32.2 per litre.

The overall business growth was largely broad-based with all channels posting good growth. In line with the targeted initiative of expanding the retail reach and presence, PMFL continues to invest in the sales and distribution (S&D) infrastructure.

Devendra Shah, chairman, PMFL said: It gives me immense pleasure to state that our consolidated revenues for the quarter has grown by 8.8% YoY; whilst our margins and profitability have witnessed strong improvement. The Gross and EBITDA margins have expanded by 520 basis point and 340 basis points to reach 26.3% and 8.6% respectively.

Over the last two quarters, the milk procurement prices have been benign and we expect it to remain stable ahead. Improving consumer sentiments coupled with our continuous focus on the value-added products and the health and nutrition segment is expected to drive healthy performance in future.

Parag Milk Foods is the largest private dairy FMCG company in India. The companys manufacturing plants are located at Manchar (Maharashtra), Palamaner (Andhra Pradesh) and Sonipat (Haryana).

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