Revenue growth masks 35% PAT collapse; margin recovery depends on price-pass timing

EBITDA margin collapsed to 5.4% vs 8.2% a year ago; 280 bps decline. Q1 YoY PAT fell 35.4%

Milk sales price only rose ₹2.2/liter YoY despite ₹3.9/liter procurement cost hike. Pricing lagged 44% of cost inflation

Delivered ₹1,197.9 Cr, 19.0% YoY growth confirmed

Analysts pressed hard: India DDL only 3% volume growth vs prior 8-9%. Africa & Maharashtra drove blended 13% growth

Confirmed ₹414.7 crores VAP ex-bulk, 40.6% LTL growth supported

Call confirms both revenue and EBITDA figures and growth rates

Prior 7-8% target; Q1 delivered 5.4%. Management now says recovery from Q2. Guidance track record weakened by 280 bps miss

Core India DDL procurement only 3% YoY (ex-OSAM). Prior implied 8-10%. Slowdown driven by pricing strategy (not expanding in high-price geographies like Andhra)

Still expect 7-8% by EoFY27, but now emphasize gradual pass-through from Q2. Q1 miss pushed recovery date out by 1 quarter

Emphasize Maharashtra +10%, but India overall 3% and selective growth (not expanding in Andhra due to competitive pricing). Supplier relationships strong but geog expansion cautious

Confident 7-8% EBITDA maintained despite cyclical pressure; seasonal, not structural reset. Price pass-through underway

Andhra, Karnataka maintained (not degrowthing) but not expanding due to high competitive pricing; strategy is selective. Maharashtra +10%, Africa +28%

Africa & Orga done 70-80% already. Dodla still catching up; took ₹1+ hike in May, ₹2 more in July, plan 2.5% in Q2. Most corrections done

No major expansion planned; growing from ₹16 Cr to ₹22 Cr Q1 on existing capacity. Wait & see this year; plan later

Plan 2-2.5% more in Q2, targeting 4-5% for full year on milk. Blended (VAP) will be higher

Yes, target maintained 8-10% volume growth; pricing passed gradually, so growth continues

Amul, Nandini taken ghee/milk hikes. National cooperatives will follow. TN gap ₹10+, KA gap ₹6-7. We took ₹2 avg across regions

Normalization = no decline expected, just stabilization at ₹41/liter. May-June-July all flat around ₹41.20. No seasonal drop yet

Summer months, milk demand lower (shift to VAP). Africa milk +33% YoY. India milk 10.4L (seasonal). Normal trend resuming Q2

Africa on track to hit 100% targets (volume & EBITDA). Feed 25%+ growth. DDL already corrected pricing from mid-July. El-Niño weather impact, but no structural inventory issue

Africa stays ~10% (won't surge further without acquisitions). VAP: maintain 10% volume growth targeting; DDL 70-80%, overseas 15%, OSAM 8-10%

Core markets: maintain share, not push given high cooperatives gaps (TN, KA). Maharashtra milk balancing only 2L local sales. Geographic rotation strategy. 10% blended target

100% direct farmer payment (nearly). Animal data hard to track; farmer avg increasing steadily. Dodla feed users do 14L vs non-users 11L per farmer

Assumes continued India momentum + Africa scaling. Price hikes 4-5% target achievable but dependent on competitive landscape & demand elasticity

Gradual pass-through of ₹2-2.5% milk + 3-4% VAP hikes Q2-Q3 expected to recover margin. Assumes procurement stabilizes at current ₹41/L

No leverage needed; ₹689 Cr cash sufficient. Maharashtra on timeline, Kenya utilization ramping 80%, Uganda full capacity planned Greenfield

Dodla's ₹10+ price gap in TN, ₹6-7 in KA vs cooperatives will narrow if Amul/Mother Dairy take hikes. Current 4-5% FY27 hike plan may face volume pushback

Milk procurement costs elevated at ₹41.3/L vs ₹37.4/L prior year. Management expects normalization but says May-June-July all flat ~₹41.20/L. If monsoon disruption continues, prices stay high, margin recovery delayed

India DDL standalone milk procurement only 3% YoY (ex-OSAM). Analysts noted growth has slowed from prior 8-9%. Geographic expansion constrained by high cooperatives pricing (TN, KA) and selective capacity strategy

Q1 EBITDA margin 5.4% vs 7-8% prior guidance (280 bps miss). Management blamed cyclical/seasonal pressure and pricing lag, but recovery now pushed to Q2+. If Q2 misses again, credibility erodes; investor sentiment on margin recovery guidance would deteriorate

If procurement costs stay elevated and milk supply remains muted (not flushing), company may need to build inventory or become net buyer at high prices, stressing working capital. However, ₹689 Cr cash provides buffer