Companies

Milk Mantra looks to triple its turnover in the next five years

Shobha Roy Kolkata | Updated on October 17, 2021

Company has an EBITDA margin of over 10 per cent

Bhubaneswar-headquartered dairy company Milk Mantra is looking to scale up its presence in eastern India and strengthen its omni-channel model of distribution even as it prepares to more than triple its turnover to ₹1,000 crore in the next five years.

According to Srikumar Misra, Founder & Executive Chairman, Milk Mantra, the company currently has a turnover of around ₹300 crore and has been profitable for the last two years.

“More than just building a brand in the food space, our idea has been to build a responsible consumer company which could solve the nutrition problem for consumers and do this in line with our ethos of conscious capitalism. We have scaled the brand to ₹300 crore and have been profitable for last two years and we are continuing on that trajectory. We are looking to build a ₹1,000 crore company in the next four-to-five years,” Misra told BusinessLine.

Expansion into Kolkata

The VC funded agri-food start-up, which has a strong presence in Odisha, recently launched operations in West Bengal through a contract manufacturing unit in Kolkata. It would be looking to expanding and investing further in Kolkata.

The company, which produces and distributes milk and milk products under its flagship brand Milky Moo, would look to grow its contract manufacturing operations in Kolkata organically. But it is also open to the idea of acquiring an existing plant for expanding its operations in the State. It currently owns two dairy processing plants in Odisha.

Pandemic impact

The company has an EBITDA margin of over 10 per cent and is hopeful of scaling it up further to close to 15 per cent over the next five years.

The pandemic induced lock-down and the closure of front-line distribution channels impacted its business but it managed to clock around 25–30 per cent growth in business on a y-o-y basis.

Focus on quality

While the Covid induced lock-down may bring about some disruption in business in the short term, it is not likely to impact sentiments in long term. In fact, the larger long term effect of the pandemic has been that consumers have become lot more conscious of quality and are paying more importance to health and wellness. This would augur well for the company, which has been laying emphasis on quality, even though it comes at a premium.

“We operate in the mass premium segment. There is a 15 per cent premium on most of our categories in most markets but the solution we offer is of significantly better quality. We are also able to pass on better prices to our network farmers,” Misra said.

Omni-channel approach

Milk Mantra works with a network of close to 75,000 farmers for sourcing its milk. It is looking to strengthen the supply chain and grow the farmer base by 50 per cent in the next couple of years.

According to Rashima Misra, Co-founder & Executive Director, the company has also been focusing on building an omni-channel approach apart from pushing sales through the traditional distribution network of general and modern trade.

Also see: Why consumers sometimes pay more for less

The company, which was earlier using a white label app for D2C (direct-to-consumer) sales, has recently launched its own D2C dairy & subscription app to directly connect with consumers.

“Two years back when we were looking at innovation and bringing new products, we understood that dairy distribution, particularly in eastern India, is not that evolved. The biggest challenge was accessing and connecting the dots,” she said.

Its products are currently available across 8,000–10,000 general and modern trade outlets in Odisha and Kolkata. It also reaches over 8,000 households through its D2C app.

Published on October 16, 2021

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