The company also approves a proposed joint venture with Meadow India Holdings to sell dairy ingredients
Dodla Dairy reported a 44.3 per cent year-on-year decline in consolidated net profit to Rs 36.59 crore in the second quarter of FY27, as rising milk procurement and packaging costs weighed on profitability despite a 17.4 per cent increase in revenue from operations to Rs 1,196.02 crore.
The company’s average milk procurement price rose 15.7 per cent year-on-year to Rs 43.2 per litre during the quarter, outpacing the 8 per cent increase in its milk realisation price to Rs 61.9 per litre. Net profit in the corresponding quarter of the previous financial year stood at Rs 65.67 crore, while revenue was Rs 1,018.82 crore.
Dodla Dairy said the consolidated financial results for the two periods were not comparable following its acquisition of HR Food Processing, effective 1 August 2025.
Higher Input Costs Pressure Margins
The company reported a 41.6 per cent increase in packing material costs, while per-litre overheads rose amid inflationary pressures, the implementation of the new labour code and geopolitical developments.
Dodla increased milk prices by Rs 2.5 per litre during the quarter. However, the revision took effect in the latter half of the period, limiting its impact on second-quarter earnings.
“As the price revision came into effect in the second half of the quarter, its benefit was partially reflected in Q2 FY27,” Dodla Sunil Reddy, managing director, said.
The company also said festive demand shifted to the third quarter of FY27, unlike the previous financial year, when the corresponding demand had fallen in the second quarter.
Milk Sales And Value-Added Products Grow
Dodla Dairy’s average daily milk procurement increased 9.3 per cent year-on-year to 21.3 lakh litres, while daily milk sales volume rose 8.4 per cent to 14.2 lakh litres. Revenue from value-added products grew to Rs 327 crore from Rs 292.8 crore in the year-ago quarter. Curd sales volume increased 23 per cent to 444.7 tonnes a day.
The company’s Africa business, which operates in Kenya and Uganda, recorded revenue growth of 55.9 per cent during the quarter.
Dodla Dairy Plans Joint Venture For Dairy Ingredients
The company’s board, which met on Wednesday to approve the results for the quarter ended 30 September 2026, also approved a proposal to establish a joint venture in India with Meadow India Holdings (MIHL) to market and sell dairy ingredients to business customers.
Dodla Dairy will hold a 40 per cent stake in the proposed venture, while MIHL will own the remaining 60 per cent. The arrangement is subject to the execution of a joint venture agreement and receipt of regulatory approvals.
