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ICICI Securities Report
Dodla Dairy Ltd. has created multiple competitive advantages in the fast growing dairy industry.
Apart from cluster approach in South India, it has developed-
strong brands,
100% direct milk procurement network and
direct distribution model.
The company also focusses on products that generate return on capital employed in excess of cost of capital such as milk and curd, and has negligible/nil presence in cash burning products like ghee, cheese and whey.
Milk procurement in South India is growing at ~10% per annum.
Dodla Dairy has expanded its market share from 0.6% in FY08 to ~1% in FY21.
Considering market growth and market share expansion potential, we model the company to report mid-teens revenue growth in medium term.
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