Dairy Sector Check - Strong Potential For Margin Expansion To Continue In H1 FY25E: ICICI Securities

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..ICICI Securities Report.Trends in milk prices:Wholesale milk prices have remained elevated YoY in March 2024.Milk prices in south India have inflated 5.9% YoY in March-24, after remaining in a deflationary trend in CY23 andskimmed milk powder prices have increased 4.2% YoY in March-24 but corrected month-on-month. We note milk supply has remained strong even in March-24, indicating lower/ stable milk procurement prices. We also note dairy companies are accumulating SMP inventory at lower levels. It can help in maintaining profitability even if there is a rise in milk procurement prices. Hence, we believe there is strong potential to expand margins YoY even in H1 FY25E. We remain constructive on the sector led by its strong return ratios (more than cost of capital) across cycles and likely higher margins in H1 FY25E. We have Buy rating on Heritage Foods Ltd., Add on Dodla Dairy Ltd. and Hold on Hatsun Agro Products Ltd..Click on the attachment to read the full report:.Dynamatic Technologies - On The Runway; Set To Soar Further; ICICI Securities Initiates Coverage With Buy.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Dairy Sector Check - Strong Potential For Margin Expansion To Continue In H1 FY25E: ICICI Securities

We have Buy rating on Heritage Foods, Add on Dodla Dairy and Hold on Hatsun Agro Products.

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