Parag Milk Foods up 7% on launching a new product in its premium category

The curd market has witnessed significant growth in the recent past on account of a burgeoning number of health-conscious consumers in India, the company said.
Shares of Parag Milk Foods rallied as much as 7 per cent to Rs 111.70 apiece on the BSE on Friday after the company introduced a new product to its premium category. 

At 01:15 PM, the stock was trading over 3 per cent higher at Rs 107.50 on the BSE. The stock had hit a 52-week high of Rs 177 on the BSE on September 24, 2019, while its 52-week low level stands at Rs 48.50, hit on March 19, 2020. 

Parag Milk Foods, which runs brands such as ‘Gowardhan’, ‘Go’, ‘Pride of Cows’ (POC), ‘Avvatar’ today launched Pride of Cows Curd, Full of Love. "Pride of Cows Curd is made from pure Pride of Cows milk and is derived from the Company’s own farm. The curd will be delivered to the consumer’s doorstep through a completely contact-free process that involves a full automated milking and production system and a cold chain network that maintains a constant temperature throughout in order to retain the curd’s flavor and aroma," the company said in its press release

The curd market has witnessed significant growth in the recent past on account of a burgeoning number of health-conscious consumers in India. With the health benefits associated with curd, such as its high-protein content and gut-friendly nature with all the goodness of milk, the curd market is bound to grow rapidly in the coming years, the press release added. 

Meanwhile, the profit margins of dairy companies are expected to increase in the September quarter after a sharp contraction in the March and June quarters because of demand destruction following the Covid-19 outbreak. CLICK HERE TO READ FULL REPORT

According to the analysts with ICICI Securities, dairy companies with strong business moats such as brands, distribution network, and healthy balance sheet to enjoy a lower cost of capital as there will not be any (material) change in risk premium. 

"With lower interest rates, the dairy companies may enjoy a better return on equity (RoE) as interest cost will be lower. With likely better return ratios and reduction in the cost of capital, the spread will expand resulting in higher economic value added (EVA) creation," it said in a sector update report on July 22. 

The brokerage has a "HOLD" rating on Parag Milk and Hatsun Agro and a "BUY" call on Heritage Foods. 



Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel