ITC expands dairy business across Eastern India

Research Analyst: UJVIN NEVATIA (PROPRIETOR: NEVAT INVESTMENTS) | SEBI Registration No.: INH100009628 ITC Limited (

) is expanding its Aashirvaad Svasti dairy business across Bihar, West Bengal and Jharkhand. The company says dairy is among its fastest-growing categories, recording high double-digit growth. What happened? ITC is expanding its portfolio of milk, curd, paneer, lassi and Mishti Doi while exploring healthier dessert products. The company is already the second-largest dairy player in Bihar, where over 80% of consumers still purchase loose milk. It operates seven dairy manufacturing facilities across the three states. Why does it matter? The shift from loose milk to branded dairy offers ITC an opportunity to expand its customer base. Value-added products could also improve its product mix and increase customer spending. ITC's Project Gomukh works with over 40,000 dairy farmers to strengthen milk procurement and quality. My view The opportunity extends beyond selling more milk. ITC can use Aashirvaad's established brand and distribution network to introduce consumers to higher-value dairy products. However, dairy is a procurement-intensive business. Rising milk costs, cold-chain requirements and competition could limit profitability even if revenue grows rapidly. What I am watching next I would track distribution expansion, growth in value-added products, milk procurement costs and dairy margins. These will indicate whether ITC can turn its regional presence into a profitable, scalable business. No Recommendations Source: Business Standard / PTI Disclosure: I, my entity, associates or relatives do not have any holding, position or other material interest in ITC Limited.