Parag Milk posts 56% YoY fall in Q4 PAT; EBITDA margin at 5.6%

Parag Milk Foods has reported 56.1% fall in consolidated net profit to Rs 9.81 crore on a 1.4% fall in net sales to Rs 790.12 crore in Q4 FY24 as compared with Q4 FY23.

Profit before tax in Q4 FY24 stood at Rs 13.53 crore, down by 18% from Rs 16.49 crore in Q4 FY23.

Consolidated EBITDA declined by 5.21% YoY to Rs 44 crore and consolidated EBITDA margin fell by 20 basis points YoY to 5.6% in Q4 FY24.

For FY24, Parag Milk Foods has reported net profit and revenue of Rs 90.58 crore (up 70.1% YoY) and Rs 3,138.70 crore (up 8.5% YoY), respectively.

 

Parag Milk Foods said that the business performance for FY24 signifies focus on sustainable profitable growth. The revenue has crossed Rs 3,000 crore mark on the back of strong brand equity and competitive market positioning. The focus on margin expansion continues with overall GP margin expansion of 4.2% YoY.

The performance outlines robust operating cash flows of Rs 99 crore for FY24. The company has bolstered its abilities in the rapidly growing new-age channels like Modern Trade and E-commerce, both of which have contributed to the overall growth.

The company has capitalized on the benign milk prices and expanded its gross margin profile along with premiumization and improvement in the value-added product portfolio. The company continues to invest in brand building with the overall advertising & promotion spends at 4.2% for FY24 vs 2.5% in FY23.

Core categories of Ghee and Cheese have seen continuous traction throughout the year and have posted a growth of 3.5 % YoY. For FY24, the general trade, modern trade & e-commerce posted a growth of 3% YoY, 6% YoY, respectively.

The average milk procurement stood at 16 lakh litres per day; aided by stable global market coupled with good flush season; the milk prices have stabilized. For FY24 the average milk price stood at Rs 33.8 per litre.

Devendra Shah, chairman, Parag Milk Foods, said: It gives me an immense pleasure to state that our consolidated revenues for FY24 have crossed the milestone of Rs 3,000 crore; along with improvement in margins and profitability.

The profit after tax for the year was at Rs 91 crore, with healthy operating cash flows of Rs 99 crore. Over the last few quarters, the milk procurement prices have been benign, and now we expect an upward bias. Despite of tailwinds; we are geared up for improving our margin profile.

We would continue to enhance our industry-leading R&D capabilities and infrastructure to drive innovation and delight our consumers across the globe. Our forward integration of brand Gowardhan into the traditional sweets category is an initiative in this direction. The initial response of the prototype is very positive and encouraging and we aim to target a bigger launch around the festivities. We are inching up on our business process transformation along with driving efficiency across the value chain. With an ensuing expansion and acceleration of the distribution footprint, we plan to incorporate a foreign wholly owned subsidiary (WOS) in Dubai, to cater the international market.

Parag Milk Foods is the largest private dairy FMCG company with a pan India presence. Under brand Gowardhan, the company offers traditional products like Ghee, Dahi, Paneer, etc. Under the brand name Go the company offers products like Cheese, UHT Milk, Buttermilk, Lassi, Yoghurt etc. Pride of Cows, the flagship brand of Parag Milk Foods was introduced with a proposition of farm to home concept targeted towards customers seeking premium quality dairy products. The company has also ventured into the B2C segment for Whey Protein with the brand Avvatar.

The scrip rose 0.81% to end at Rs 214.55 on the BSE on Saturday.

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