Dodla Dairy Targets 15% CAGR Topline Growth In Next Five Years: MD Sunil Reddy

Dodla Dairy is aiming for a double-digit growth in revenue in the current financial year with Ebitda margins of 8 to 10%. The Hyderabad-based milk products company expects its revenue to grow by 15% in FY 2025-26, led by a fall in procurement prices, according to its Managing Director Sunil Reddy.

“We normally say that we will have that 15% growth in terms of revenue and also maintain our Ebitda margin between 8% and 10%. We will go up in Ebitda by another percentage or two in the coming quarter itself because of the reduction in procurement prices,” he said during a conversation with NDTV Profit on Tuesday. 

The company is targeting a 15% compound annual growth rate (CAGR) in topline over the next five years. 

“We should maintain a 15% growth trajectory for the next five years in terms of revenue. A longer-term view is a 15% CAGR on topline and on an absolute number basis, even the bottomline will grow along those numbers,” the MD said.

In Q1FY26, Dodla Dairy’s Ebitda margins fell to 8.2% from 11.5% in the same period last year. Its consolidated profit after tax (PAT) dropped 3.3% year-on-year (YoY) to Rs 62.9 crore in Q1FY26 from Rs 65 crore in Q1FY25. Its Ebitda declined 21.5% YoY to Rs 82.5 crore in Q1FY26 from Rs 105.1 crore in Q1FY25. 

The company’s revenue increased 10.5% YoY to Rs 1,006.9 crore in Q1FY26 against Rs 911.61 crore in the year-ago quarter.

Reddy clarified that the comparison with the previous year was against an unusually "phenomenal quarter."

"Last year was a substantially large increase because we had just moved into being a net seller of commodity," he explained and added that the first quarter's performance was more of a "rationalising" phase.

On the expansion front, Dodla Dairy is moving forward with its plan for strategic inorganic and organic growth. The company has approved acquisition of HR Food Processing to gain a foothold in the eastern statees. It is also working on a new greenfield plant in Maharashtra with a capacity of over 10 lakh litres. These initiatives will be funded entirely through internal accruals.

"We have enough of internal accruals with us. We have around Rs 750 crores of cash with us and we're deploying that cash," Reddy confirmed, ruling out any need to raise fresh capital.

Shares of Dodla Dairy were trading flat at Rs 1,331.5 apiece, up 0.02%, on the NSE in the pre-closing session on Tuesday at 3:14 p.m. In comparison, the benchmark Nifty50 stood at 25,061.4, down 0.12%.