Milkfood is stepping up its push into India’s premium dairy market, with plans to launch A2 milk ghee and invest around Rs 20 crore in its Patiala manufacturing facility as the company looks to drive value-added growth in FY2026-27.
Milkfood Limited is sharpening its focus on premium and value-added dairy products as changing consumer preferences create opportunities beyond traditional milk and dairy staples.
The company plans to introduce ghee made from A2 milk, positioning the product toward consumers seeking differentiated dairy offerings associated with quality, provenance and traditional food practices.
The proposed launch is part of Milkfood’s broader strategy for FY2026-27, which combines premium product development with manufacturing expansion, improved asset utilisation, energy-cost optimisation and tighter financial discipline.
To support its expansion, Milkfood is investing approximately Rs 20 crore at its Patiala plant to establish a dedicated butter manufacturing facility.
The capital expenditure includes a Continuous Butter Machine and Butter Cold Room, along with other critical processing infrastructure. The company expects the investment to strengthen butter production capabilities, improve manufacturing flexibility and increase capacity utilisation.
The Patiala expansion is designed to provide additional capacity as Milkfood broadens its portfolio of value-added dairy products.
Rather than relying solely on volume growth, the company is increasingly targeting categories where differentiation can support higher realisations and greater value addition.
Milkfood’s expansion plans are also being supported by the monetisation of existing assets.
During FY2025-26, the company sold its Moradabad plant at Agwanpur for approximately Rs. 130 crore. The proceeds were used for loan repayment, working capital requirements and capital expenditure at the Patiala facility.
The move allows Milkfood to redirect capital toward its current growth priorities while reducing financial leverage and strengthening liquidity.
Alongside its expansion plans, Milkfood is pursuing measures to reduce energy costs and improve operational efficiency.
The company is transitioning its boiler fuel from rice husk to parali, or paddy straw and other agricultural waste, with the aim of improving the use of agricultural residue while optimising energy expenses.
Milkfood is also installing a 500 kWp solar power plant for captive consumption as part of its efforts to improve energy efficiency.
Job Work Business Adds another Growth Lever
The company is also expanding its job work business and expects revenue from the segment to reach approximately Rs .30 crore in FY2026-27.
Together, the A2 ghee launch, Patiala investment, asset monetisation, renewable-energy initiatives and expansion of job work point to a strategy focused on balancing growth with financial discipline.
For Milkfood, the broader bet is clear: combine its existing dairy manufacturing base with premium products and more efficient operations to capture greater value from India’s evolving dairy market.