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Delhi’s own Delhi Milk Scheme (DMS), which had been on the brink few years back, has made a net profit of Rs 6.65 crore in the 2014-15 financial years on the back of improved realizations and reduction in production cost. The profit is just its second in the over 50 years of operation.
According to a statement furnished by DMS to the department of agriculture, the Scheme had a turnover of Rs 402.13 crore in 2014-15, which was around 23.87 per cent higher than the previous financial year.
In 2013-14, DMS suffered a net loss of Rs 15.88 crore. Department of Agriculture is the nodal ministry under which DMS operates.
Year before that, i.e. in 2012-13, DMS had made cash surplus of around 8-9 crore, which was its first since inception in 1959.
Before this, the scheme, which supplies milk and milk products largely in the national capital suffered consecutive year of loses.
In 2011-12 financial year, DMS had net deficit of around Rs 28.26 crore, while same in 2010-11 was around Rs 8.99 crore and Rs 24.15 crore a year before that.
The non-cash cost of DMS for the 2014-15 financial year was around Rs 2.35 crore, due to which it made a cash profit during 2014-15 of Rs 9 crore.
“Higher production and sales coupled with procurement of milk and condensed skimmed milk at the most competitive and lesser dependence on commodities like skimmed milk powder and white butter has primarily helped improve the bottom line,” B S Beniwal, General Manager, DMS told Business Standard.
He said last year, DMS had to suffer a loss because of low purchase price due to which farmers were reluctant to supply milk to them.
The Scheme usually follows the purchase and sale price fixed by other cooperative and has limited scope to alter them.
“In 2015-16 though, the purchase price is much better and we are purchasing milk at the rate of Rs 34.50 per liter,” Beniwal said.
He said that revenue growth is expected to be maintained in the 2015-16 financial year. DMS has milk production and packaging capacity of 5 lakh litres per day, besides a network of 1,298 outlets in NCR. The government-owned dairy unit has 800 employees, but the milk production is only about 2.75 lakh litres per day.
Delhi is the largest market for Amul with daily sales of over 24 lakh litres. Amul has processing capacity of over 40 lakh litres per day in Delhi-NCR.
