Dodla Dairy Ltd (NSE: DODLA) Q1 2026 Earnings Call dated Jul. 21, 2025
Corporate Participants:
Unidentified Speaker
Sunil Reddy — Managing Director
Venkat Krishna Reddy Busireddy — Chief Executive Officer
Murali Mohan Raju Reddycherla — Chief Financial Officer
Analysts:
Unidentified Participant
Aniruddha Joshi — Analyst
Deepak Lalwani — Analyst
AbAbhishek Mathur — Analyst
Rajat Setiya — Analyst
Praveen Kumar — Analyst
Aditya — Analyst
Disha Giria — Analyst
Kiran Kumar — Analyst
Parikshit Gupta — Analyst
Presentation:
operator
It. It. It. Sam. Ladies and Gentlemen, good day and welcome to the Dhurla Dairy Limited Q1FY26 earnings conference call. This conference call may contain forward looking statements about the company which are based on the beliefs, opinions and expectations of the company as on date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in the lesson only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touchstone phone.
I now hand the conference over to Mr. Sunil Reddy from Todla Dairy Ltd. Thank you. And over to you sir.
Sunil Reddy — Managing Director
Thank you very much. Good afternoon. On behalf of Dogla Dairy Ltd. I extend a warm welcome to everyone joining us on our call today. On this call I’m joined by our CEO Mr. BVK Reddy, CFO Mahmoudli Mohand Raju and SGA, our investor relation advisors. I hope everyone had an opportunity to go through the financial results and investor presentation which have been uploaded on the stock exchanges and on the company website. We began FY26 with our quarterly revenues crossing the thousand crore mark for the first time. During the quarter we registered the Highest revenue of 1007 crores on a year on year basis growth of 10.5% and an EBITDA margin of 8.2% and a fat margin of 6.2%.
This performance comes amidst changing seasonal patterns where we witness early rains dampening the summer demand for value added products like curd flavored milk, ice cream et cetera. During the period among the VAS products, bulk sales for S and P and butter were higher than usual and as we took a decision to liquidate the inventory in view of such decline in price environment to maintain balance sheet hygiene. Additionally main is accompanied by the higher milk supply leading to a decline in milk prices on a sequential basis but they remained higher compared to Q1 of financial year 25.
On a year on year basis, procurement prices have grown faster than the milk realization prices. As a result of these multiple factors, the the margin profile remained under pressure during Q1FY26. We expect this trend to improve in Q2FY26 as the full impact of lower procurement prices will be reflected in the current quarter. In Africa we saw a healthy growth in terms of revenue of 26.9% on a year on year basis and an EBITDA margin of 13% which is lower as compared to Q1 of last year. The primary reason for the faster growth of revenue and lower EBITDA margin is the start of a new Kenya plant where we currently focus on capturing the milk market at a strategic pricing of products.
Sunil Reddy — Managing Director
In addition to this, we have also witnessed an increase in procurement prices compared to Q1FY25 in both Kenya and Uganda. Once again we have enough market share. We will see the gradual improvement in profitability of our Africa business also coming to orgasm. This business continues to witness positive trend and deliver promising numbers. The revenue for the quarter grew by 29.4% and EBITDA grew by 84.4%. EBITDA margins now stand at 17.6%. The overall capacity utilization level of the dairy business is in the vicinity of 70 to 75%. And as we discussed previously, we’re looking for a strategic expansion of our capacity as well as our footprint.
With this expansion, we expect the seasonality impact to minimize to a certain extent. In line with this framework, our board recently approved the acquisition of 100% stake in HR Food Processing Private Limited. The company operates on the premium brand Osam and has established a strong presence in Bihar and Jharkhand. This transaction is consistent with a predefined inorganic growth plan. Further, our greenfield expansion of the rupees 280 from Maharashtra aimed at tie upping the potential Shola food market is on track. With the daily procurement in the region already reaching around 2.6 lakh liters per day, we are developing a fully integrated facility with a capacity of 10 lakhs.
With this brief I will now hand over to our CEO Mr. B.V. kreddy. Thank you very much.
Venkat Krishna Reddy Busireddy — Chief Executive Officer
Thank you Sunil sir. During the quarter our meat procurement was the highest ever level of around 18.000 liters per day on average. This is in line with our net seller strategy where we continue to raise our procurement levels whenever there is a favorable procurement conditions available in the market. Procurement was around 17.6 lakh liters per day in the same period as the last year. Average procurement cost fusion of FY26 was 37.38 per liter which was around 34.15 per liter. Over the same period of the last year, the average Procurement cost in Q4FY25 was 37 point.
The average milk sales for the quarter were 11.9 lakh liters per day, an increase of 4.9% as compared to Q1 of FY25. While comparing the financial performance of Q1FY26 with FY2125 there were seasonal variations particularly due to early monsoon. Number of rainy days were more in FY26 and which is about 10 days higher than the compared to the FY Q1 25 impacting the mix of our WAP product portfolio as well as the reduction in milk prices as explained by our MB necessary. Overall our WAP sales contribution during this quarter stood at 36.2% of sales. Curved sales took 4.52.3 metric tonnes with a degrowth of 3.2 on year on year basis.
Venkat Krishna Reddy Busireddy — Chief Executive Officer
Bulk sales during FY F1Q26 stood in of 57.7 crores which was 35.5 crores of the same period of the last year. We need to keep in mind that this performance is coming on top of higher comparable basis as we registered a strong growth in MQ1FY25. Hence if you look at the performance of last two years the staggered numbers are fairly attractive. Now coming to Agafield business it is performing exceptionally well and we see lot of potential for scaling of this business as we are only catering 35 to 40% of our farmers and we expect this number to raise further.
Going ahead. Aura Field is not only providing the strategic edge while maintaining relationship with the farmers but it is also strongly positioned to deliver faster growth in the coming years. Overall our focus remains intact on enhancing our procurement strength, widening our product portfolio and expanding our distribution with new as well as existing markets. So with the proposed OSAM acquisition and Maharasha expansion, our long term aim is to deliver accelerated growth while maintaining a healthy profitability across the business. Now I would request our CFO Mr. Mughali Mohan Raju to share your financial highlights.
Murali Mohan Raju Reddycherla — Chief Financial Officer
Thank you Mr. B.V. karu and a very good afternoon to all the participants on the call talking about quarterly performance in Q1FY26. Revenue from operations to date,07 crores in Q1FY26 compared to 912 crores in Q1FY25 marking the highest ever revenue in any quarter. With a year on year growth of 10.5%. We delivered a gross profit of 260 crores in Q1FY26 margin stood at 25.8%. Employee expenses in Q1FY26 increased 19.4% to 47 crores compared to Q1 in the previous year primarily due to annual increments under addition of new employees at various divisions such as procurement team, sales team and expansion of the Kenya plant etc.
Increase in other expenses include higher advertisement costs, transportation and increment of contract employees. EBITDA for the quarter to date 83 crores with a margin of 8.2%. This quarter our depreciation expense came in at 17.8 crores compared to 18.2 crores in Q1FY25. The other income increased 114% from 7 crores in Q1FY25 to 17 crores due to interest income on investment and a provision reversal amount of on flavored milk gst. There was a decrease in our tax expense as a result of multiple factors such as reversal of deferred tax on long term capital gains on investment refunds related to previous year taxes, absence of deferred tax impact on cash balance in the subsidiary in the current year and lower profit.
We delivered a net profit of 63 crores for this quarter with a net profit of margin of 6.2% on the balance sheet spread in Q2. We expect to utilize our cash balance towards inventory buildup during flush season and the outcome acquisition which is expected to complete in the next few days. With this we conclude the presentation and open the floor for further discussion. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question, press Star and one on the Touchstone telephone. If you wish to remove yourself from the question queue you may Press Star and two participants are requested to use handsets while asking a question.
operator
Ladies and gentlemen, we will wait for a moment while the question queue assembles. We have a first question from the line of Mr. Aniruddha Joshi from ICICI Securities. Please go ahead.
Aniruddha Joshi
Yeah, thanks sir. Thanks for the opportunity. In terms of milk prices at least we had seen some from some of the channels that milk prices have corrected. With early monsoon settling in. So do you see that probably the July prices are also in a way lower than what prices we had seen. In June quarter And that should lead. To relatively better profitability in coming in rest of the full year.
Aniruddha Joshi
That is question one. Secondly, we have seen some of the cooperatives have raised prices but the private pairs have not yet fully exercised the pricing power. So how much price hikes we can. Take to maintain the margins or we. Would like to go for market share gains by taking the advantage of that. And lastly, what will be the inventory of excess S P and butter left.
Aniruddha Joshi
On the June balance sheet now? Yeah, that’s it from my side.
Sunil Reddy
We do think that the procurement prices have corrected and it is looking good for this coming quarter where we are confident that we will be able to improve our margins over the last quarter. The second question regarding our increasing of selling prices. Whatever selling price increase we have taken was not enough in terms of the procurement price hike that happened in the first quarter. But I think with the second quarter milk procurement prices coming down we will not be taking that much of a milk price increase.
But I think the product mix will improve and we can see an overall improvement in the realization front also. And the third question regarding inventory. As of now there is no significant buildup of inventory. Depending on the various season pans out we should be equivalent to the same as last period. I think specifics. Murali can go ahead and give you the specifics.
Murali Mohan Raju Reddycherla
Yeah. With regard to the inventory sir, as of now we are having better only 99 crores as against 155 crores of last year June 24. So the substantial deduction even the scheme port also last year we have around 144 crores. But now we have only 17 crores. So that was even in March also from 43 crores it came down to 17 of skim milk powder. Even in the gutter also from 19 crores it is a reduction to 9 crores.
Murali Mohan Raju Reddycherla
And one more already. See Mr. Sunrit is clarified about regarding the procurement. If you see last year in the first quarter, you know the lowest procurement in Africa and lowest procurement that ever. Lowest procurement even in India also. So subsequently in the second and third quarter even India also is one of the procurement prices and in Africa also has gone up. So now you know from April to April we have corrected only some 3040 paisa. April and May we have done some 90 paisa. And then July also we have done another 58 to 60 paisa.
Now overall you know that that is reflecting in the month of July though prices slowly see it is coming down definitely quarter two and three. It will reflect the profitability the overall console.
Aniruddha Joshi
Is it? Yes, yes sir.
Aniruddha Joshi
This is very helpful. Just one last question. What will be the internal guesstimate as far as the lost sales will be means? I guess many product like beverages, ice cream, curd revenue.
Murali Mohan Raju Reddycherla
Because of unseasonal rains. So we have not got any growth in curd. Lucky L. We have lost a lot of volume. Even there’s no curd growth. Buttermilk. So all that you know where you see gap. You know we. We have maintained almost like last year numbers are 1 or 2% lesser than the last year numbers. So see that growth, you know, see normally what we get in a month of April, May so that we do not get.
Aniruddha Joshi
Okay, okay, fine.
Sunil Reddy
We got our Growth in milk. But we didn’t get the growth in curd, which is high profit curd. I think we had a degrowth in terms of the first quarter. Comparatively it was around 3% I think if I’m right. Yes, but you know, normally now we will have a very good growth in the first quarter. See, that has not happened because of unseasonal rains.
Aniruddha Joshi
Okay, fine.
Aniruddha Joshi
Last question from my side. You want to call out the impact in any particular state or is it across all the key states in south India as well as Maharashtra?
Sunil Reddy
Yeah, across all the states.
Sunil Reddy
There’s all the states. But depending on an apple to apple comparison of the state averages, some states, others will have a larger volume, might have had some benefit. And some states where we have a larger volume, we might have had a little adverse effect in terms of let’s say Tamil Nadu prices comparatively so slightly better than the prices of Karnataka. Ours is almost a little what we are getting as mill. So there will be that little advantage of one state having higher. But for us it might have gone a little other way around. That will also add to a percentage or two differentials which normally are there.
Oh, okay, sure.
Aniruddha Joshi
Sir, this is very helpful many times. Okay, thank you.
operator
Thank you. The next question is from the line of Deepak from Unifi Capital. Please go ahead.
Deepak Lalwani
Hello sir. Thank you for the opportunity. So first question. In the liquid milk sales of 11.9. Lakh liters per day you can break up how much is India and what has been the India growth in this quarter? And similarly for procurement, if you can break up how much is India and the procurement growth in India, please. I. Think can you take that and give the breakup of both India and.
Murali Mohan Raju Reddycherla
Yeah, sure sir. I’ll do standalone. Liquid milk was grown by. Which is around 2.9%.
Deepak Lalwani
How much quantity?
Murali Mohan Raju Reddycherla
Quantity India, sir, 10.27 lakhs. Okay, that was there. And which has grown by 3% in the value and revenue by 6%. And with regard to the Africa milk value, around 1.6 lakh now has against 1.35 lakh of last year. That is almost a 19% of growth in the volume. And with regard to the value this year it is 81 crores. Last year it is 64 crores. That is 26% of growth in the office. That is fine.
Deepak Lalwani
Yes. Can you give the procurement number? Okay. Africa procurement number LPD sir, it is 1.98.
Murali Mohan Raju Reddycherla
Yeah, yeah. Procurement sales in almost the same number the first quarter average sales including our yogurt is 1 lakh 97,000 meters our procurement also is close to that one 1,98,000 sir. And India standalone it is 16.75 per procurement as against last year of 15.9. In India we are growing at say 2, 3%, you know, and our performance is moving at a higher rate.
Sunil Reddy
You know, the question here is that B2C sales visa vis selling in the B2C market. So firstly, how do you take up this challenge of B2B versus B2C and is there an eventual goal to reduce prices? Because we are looking in a price sensitive market. So is there an eventual goal to reduce prices and eventually. So any strategy on volumes that you can call out from your end, how can the volume growth improve? Because adversely there with the range, milk volume should not have come grown, it should have actually come down.
Sunil Reddy
We were able to manage growth of milk because of interventions that we have done like advertising deeper penetration into markets we had. That is why we did get the 3,4% growth in terms of liquid make volume third as a consumption pattern. Once the monsoons, the rains come and people stop eating curd. So that significant drop of the curd volume is the reason why you will see that overall number not being there. If the curd had not shrunk and it had maintained even the feel of whatever the numbers were, we would have seen that 78% of volume growth coming from the curd index alone.
It’s a value added product. I think coming to the B2B. B2B for us will only be single powder as the base go ahead. Because we are actively pursuing improving our consumer G sales. We have also improved our because of getting to modern trade and having more presence. Regarding pricing, I don’t think there will be an undercutting of pricing as much as to take on the market share. It won’t.
Sunil Reddy
It will be that they’re not trying to over premiumize our product versus the cooperative. We are trying to maintain a sort of a mass premium, not a super premium. And I think pricing that is the reason we are keeping where it is and not reducing the price for volumes here.
Deepak Lalwani
So in a hypothetical scenario, if the prices are going down currently, the assumption that we should be working with is a lower volume growth of say 3, 4% and you’ll be able to maintain prices. That’s the call out that you’re making, right?
Sunil Reddy
Yes. The growth percentage will be a little higher and the procurement prices will come down. So that is what it will be. It will come back to the same volume wise 7, 8% and value wise, maybe between the 10 to 15% of 12, 13%.
Deepak Lalwani
Understood. And secondly, I wanted to check in the B2B sales that we did in this quarter. Were there any write offs that we took. Effect?
Sunil Reddy
We have sold out only in the June. We have called something little at the market price lesser than our carrying value flowing stock. Everything is at the market price. How much loss did we incur in the June days? Sir, if you can quantify that June. It is around 1.2 crore.
Deepak Lalwani
And today we are carrying about 100 crores of SFP and supple inventory, right?
Sunil Reddy
Yes. Overall it is a 17 plus 9. The closing inventory is only 23 crores put together SMP as well as this thing, there is no much stock. And on an average every day we consume 10, 10 for internal consumption. So we don’t think so anything is there left for us to sell as a B2B.
Deepak Lalwani
So one last question I had. This is a combination of our subsidiary performance. So you mentioned that Africa had an issue with regards to procurement price and Kenya underutilization. So if you can touch up on that, on how the outlook will look like. And secondly, Orga paid has been a remarkable margin performance. So should we expect this margin trend to continue or should it normalize to a certain level?
Sunil Reddy
Yeah, see first, you know we’ll go to Africa. Africa. Because now last year, April only we started Kenyan operation and we got a very good numbers. So and also last year, you know, see the first quarter the prices, procurement prices were very low.
But you know, second quarter prices have gone up. But you know, since this quarter, you know prices are very stable there also. And last year overall, last year to last year, you know we got a volume of, you know, 35tec 6000l. So volumes are in the last couple of months, you know, the volume is stable now. It is now, you know, around, you know, 2 lakhs, 1.6 lakhs is a milk and 40,000 is a yogurt. See the volumes are very stable and the procurement prices also this year are very stable in Africa. And compared to last year, this year you know we see better profit margin in Africa.
And r. Yes, still there is a scope now right now we are catering only 35 to 40% of our own farmers. And month on month, year on year we keep on increasing. And still we have a lot of scope here because plant capacity utilization is less than 45, less than 50% only. So this year also we have taken aggressive number and part of the period we are hoping that, you know, this number will continue this financial year also.
Sunil Reddy
With regard to the margin, maybe this quarter, we have a very good performance of 17.6 as against average of last year, around 15%. So probably there may be 1% here or there, but we are intact with the volume or the margins.
Deepak Lalwani
Okay, understood. I’ll call back in the queue for more questions. Thanks.
operator
Thank you. The next question is from the line of Mr. Abhishek Mathur from Systematics. Please go ahead.
AbAbhishek Mathur
Yeah, hi sir. Thank you for the opportunity. Just wanted to check in the WAP segment, are we now seeing some kind of a growth revival in the month of July or even in June, did we see some kind of a revival. Versus April and May? And secondly in Africa, is there a sense we are getting on any intensification of competition which is happening or is it stability on that front also? Also wanted to check why the procurement cost in Africa has gone up. Reasons behind that. Thanks.
Sunil Reddy
Here, you know, so the first week of July last, you know, again last couple of days onwards, you know, it is raining but you know, first to 10, 12 days, you know, July was somewhat, you know, good growth actually as far as Indian numbers is concerned, sales numbers and Africa, you know, see the now, you know, it is very stable. Procurement also is very stable. And we are expecting by year end, you know, further volume growth will get in Africa. There is also, you know, enough number of diaries are there. But you know, we have consolidated our position that you know, we will able to take growth in market also.
Venkat Krishna Reddy Busireddy
Right. So there’s nothing specific that we want to call out in terms of competition intensifying or anything. It’s stable is what you’re saying.
Venkat Krishna Reddy Busireddy
Are living with the competition. There’s no problem. Especially in Uganda, you know, yogurt, you know, there’s not much players where we have taken almost, you know, number one position in Uganda. Yogurt is concerned there, you know, yogurt we have keep on consolidating and year on year we’re getting a good growth there in Africa. In Kenya, you know, there’s a number of places are more compared to Uganda in legendary sales. But in spite of that, you know, we have established our brand. So we were able to take numbers with a good growth.
Venkat Krishna Reddy Busireddy
So coming to the basic thing is yes, we will have the regular growth as what we are maintaining between plant capacity and growth in Kenya. Uganda also will continue to grow depending on the profitability is again like how we are paying the price. For example, last year same quarter we had significantly low price. That is why in the first quarter you would have seen a huge profitability and the following quarters with a sort of maintained and muted down this year. We didn’t see that huge in the first quarter. But we will maintain the same profitability level as we go forward for other quarters which will be an improvement over the previous year quarter.
Venkat Krishna Reddy Busireddy
Abhishek. Sir. There’s a sort of disturbance in your life.
AbAbhishek Mathur
Yes, sir.
Venkat Krishna Reddy Busireddy
Anything else guys?
AbAbhishek Mathur
Yeah. Sir, are you able to hear me now?
Venkat Krishna Reddy Busireddy
Yeah. Yes. Yeah. So I was. Yeah. I was saying, sir, that in the. India VAP segment you’re saying that we. Are seeing somewhat good growth or stable growth in the month of July in. The last two weeks. Is that the right takeaway? Yeah. Yeah. Right. Yeah, the first two weeks.
AbAbhishek Mathur
Understood. And lastly, sir, if you just a bookkeeping question. If you can help with the overall console realizations.
Murali Mohan Raju Reddycherla
The overall. The VAP console realizations and the India Africa realizations, please. India imagination console is 62.78 overall for the quarter component. Standalone it is 63.24. Africa 59.25. And Arga fees it is not of the milk, it is a fee. It is 24.70. Consider the vac consolidation please. V Console realization. Okay. Realization is basically the VA overall 60 to 60 rupees
AbAbhishek Mathur
. Yeah, thanks. So that’s all for the excluding part. Sure, thanks.
operator
Thank you. The next question is from the line of Mr. Rajat Sitia from. I thought BMS. Please go ahead.
Rajat Setiya
Hi. Thanks for the opportunity. Sir, what is the. What is driving the high margins in Ora feed? We used to be at 12 13% and now we are doing 17 18%. Also 75% is the raw material. So availability of raw material and the price is very stable. So that is there. And the selling side also see not much of fluctuation. 12% in the cost of procurement, cost of mix of all raw materials. But the sales realization was reduced only by 6%. So there is a delta of 6% which was in turn resulted into the overall margin improvement.
Rajat Setiya
For this year. I think last year margins were higher as well. So is it largely because last year also raw material prices were down more than the realization?
Murali Mohan Raju Reddycherla
Yeah. So last year also because an average of 18.8 of per kg, it was reduced to 17.6 for the last Q4 of FY24 that has further reduced by 17.3. So quarter on quarter the prices are reducing it. And out of that some of the amount we are also passing on to the partners. If any extra amount is there, that was building up in the margins.
Rajat Setiya
So if the raw material prices go up a lot, our margins There that will be a challenge, right?
Rajat Setiya
Generally we will pass it on. Okay. So we don’t expect there will be any more volatility more than 1 or 2%. So with the volume increase I think we are absolute wise will grow. Only we don’t have a forcing any degrade in the margins in absolute amount. And what are generally the factors that drive the raw material prices here?
Venkat Krishna Reddy Busireddy
Normally no see the yes sir main is your main maze and risers qrp. These are the major items. Okay, okay, understood. And in regards to Africa, I could not understand the explanation around the increase in procurement prices. Is that seasonal increase in procurement price? No, see Africa also if you see last year procurement price first quarter was very low. Then subsequently now because second quarter has gone up. See if you see first quarter to second quarter there is a 10 rupees variation. And then you know, they somehow stable the second and third and fourth quarter now.
So somewhat it is stabilized now. Fourth quarter two now this year, first quarter now there is one rupee one and half rupees reduction in the overall procurement bank. So that’s why now even in the month of July also procurement is very stable even in Uganda, Kenya also. Now this year also there’s a sufficient range. So we don’t foresee any kind of volatility like last year. Last year there’s a huge variation in the procurement purchase. What you’re saying it’s stable now but I think in Q1 you have mentioned that procurement cost were higher. No. Last year no, see very abnormally, very low.
Actually see that, that has seen that has reflected in high profit, high profit in the first quarter of last year. But you know this year somewhat very stable first quarter to second quarter you will not see much of variation. But last year, you know, first quarter we made 18 crores and second quarter we made only 5 crores EBITDA. But you know, this year, you know, you see it is not looking like that. You may have variation of only 1 crore less than 1 crore this way, that way because the purchase price is. I didn’t get you.
Venkat Krishna Reddy Busireddy
Can you repeat the question?
AbAbhishek Mathur
Yeah, I’m saying what are the flush and lean seasons in both the countries. So there are two months now these are clutch only. And then you know, August, September, October will be a lean again one and see November, December, January there will be flush. So there will be three months plus and three months will be lean again. Three months plus three months will be lean there. Okay. And the December one you said is a flush, right? Yes, October, November, you know, up to December it will be flush. It is the same for both the countries, right? Yeah, more or less.
One month this way, that way. Sometimes, you know, rains, you know, delayed, you know, 15 days. One month this way, that way. All right, thank you so much.
operator
Thank you. Ladies and gentlemen. In order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to one or two per participant. Should you have a follow up question, we would request you to rejoin the queue. The next question is from the line of Mr. Praveen Kumar from Aquitas Capital. Please go ahead.
Praveen Kumar
Yes, thanks for the opportunity. I had a couple of questions. The first one was looking at your procurement volumes which are going up over time, especially in India from pickup in Maharashtra and elsewhere. On one side of procurement volumes are doing well, whereas on the other side, year to year there continues to be.
Unidentified Speaker
The seasonal kind of volatility which is somewhat unpredictable in nature. So in this kind of a construct, where your procurement volume going up and. There is seasonal volatility leading to demand unpredictability.
Praveen Kumar
How do you manage margins from a strategic perspective? Can you, can you walk us through that?
Venkat Krishna Reddy Busireddy
Yeah. So basically the volume market growth, volatility, it will only become more and more stable once we have enough of volume of our own without depending too much on commodity. For the B2C business, we are also growing in terms of the value added part of the business which is basically trying to sell G as a value added product into the B2C and our other smaller volume growth in terms of our punnet which has almost doubled in sales volume or the combination of these more and more procurement that we get, we will consume because the leader to leader consumption will not necessarily be the same because the requirement of what purchase meter we are doing to what selling meters we are doing is different.
For example, if you are buying the Purchase meter at 4.2 or 4.3% fat, our selling will be around 4.6 or 4.7 based on the product. To manage the balancing of the both, we will need more and more procurement which will be at least, no, let’s say 8 to 10% more than our sales volume is also comfortably taken care of by our own captive requirement of balancing what we require. It is only the seasonality. When the issue comes in terms of how long are you hold, sometimes the seasons are not favorable for you. Is when we come to this one off commodity price sale that we are doing.
Otherwise we’ll try to match mostly between our own requirement and our own sale and we cannot match it precisely to start with the thing, every day it will be there or every quarter it will be there. So now we are going with the US that we will have ample link with us because a couple of years ago we ran short of fat and we had to withdraw from G share for example. So we will not be. We will be going back to not to withdraw product and continue to sell them in the B2C market. So that is the reason why we are going for more volume and the volatility will only be sort of evened out more if we are able to get that volume and to be organized.
Venkat Krishna Reddy Busireddy
Understood. Thanks for that.
Praveen Kumar
The other question was on the OSAM acquisition. See on that the gross margins there. Is a couple of it about 2% kind of a differential between the within Dodla and Osam. So can you walk us through what.
Venkat Krishna Reddy Busireddy
Is there a plan for convergence of. These grass margins over time and if.
Praveen Kumar
So what you will be doing about that?
Venkat Krishna Reddy Busireddy
Basically for us, BBK will give you the most specifics of the improvement as we go forward. I think the east markets for example BR and Jartan are from the GDP point of view it will take another couple of years as those states also grow for premiumization to have increasing the gross margins as we go forward. But on the other side we have the ability of further improvement and recognization in the operating structure of cost also which will give us an improvement. So with both of these I think it might not be dramatically higher than what we are operating in the Karakadan market But at least we’ll try to bring it up to those levels or sign those down.
Praveen Kumar
Thanks for that.
Venkat Krishna Reddy Busireddy
Thank you.
operator
Thank you. The next question is from the line of Mr. Aditya from securities Innovation Management Private Limited. Please go ahead.
Aditya
Hi sir, thanks for the opportunity. My question was on gross margins. So on a QOQ basis our gross margins have reduced by around 1.5%. But if I look at your procurement prices they are stable QOQ and we. Have a higher share of VAP in. This quarter as compared to Q4. So why have the gross margins reduced on the Q business? The VAP is also inclusive of our bulk sale of butter and powder. Muri, can you give us evidence please?
Venkat Krishna Reddy Busireddy
Yeah, sure sir. So basically for Q on so the margins of minor reduction are there basically because of the sale of fat and butter and smt. That was only one of the reason. And generally in the Q1 we have a value as a product but that was reduced like either butter, milk or the LY or the C. These are the key Reason for that. Realization value at product of 3rd and Ry and other consumer products we had sold more of the fat because the lower realization the number grew. But the margin took a beating because of the flip in the mix of product.
Aditya
No.
Aditya
But sir, when I look at on Q basis our bag sales was around. So.
Venkat Krishna Reddy Busireddy
Even though the procurement price is one of the factors, another factor is also consumption. If you see from Q3 to Q4 the prices have increased from Q4 to Q1. From the mid of the May onwards it it started falling down. So what happens is the inventory, whatever we built up in Q4 also will have an impact on the Q1. That is the reason what happens is there will be a minor variation of the consumption also will be there. It is not only the procurement. Because like we always say that 10% or more than our procurement is on consumption.
Whatever the last May 2nd fortnight to June also will spillover of the previous inventory will be there. So that is the reason there will be a minor variation of 1% of the market.
Venkat Krishna Reddy Busireddy
So because of carry forwarding the inventory. Because the inventory of the last fourth quarter you have consumed in the first quarter. Total bulk sale of Q4 is only 38 crores last quarter. And this quarter it is around 57 crores. So here itself is around 20 crores higher. Was there that also need a higher consumption. The margins whatever we have in the bulk will not be there in the normal business is normally higher.
Aditya
Got it. And also if I look at your. Procurement price for this quarter was around 37.38. So now what were the cocaine prices in July? Is it lower than this? Yeah, this is running July you’re asking?
Venkat Krishna Reddy Busireddy
Yes. Yeah, running July. Running July is 36.90 in Africa.
Aditya
You mentioned that we had an issue. Of under utilization in Kenya. But what I recollect was we were already supplying milk to Kenya from a UANDA plant. So just wanted to understand why is there being such underutilization happening in Kenya plant?
Venkat Krishna Reddy Busireddy
Yeah, see earlier you know we used to supply milk from Uganda. But you know, after it, you know Kenyan government put a break as they stopped giving in a permits. So one year almost they have stopped giving a permit. That’s why now see in 2023 we acquired a plant in Kenya. Then subsequently that took 5, 6 months to revamp that plant and start last year.
So now, now and all now also they are not giving freely permits. Whenever there is a strategy only they’re giving a permits to import from Uganda. So that’s why that is a problem. See Uganda milk Coming to Kenya, you know it is not stable. As per the requirement they’re giving the permits. If there is a huge shortage, they are permitting otherwise now five, six months, they’re putting almost no, zero. Yeah. And what is the utilization at a Kenyan plant currently? Now Kenyan plant we are packing around 65 to 70,000 liters. That capacity we can go maximum feet are 1.3 1.5.
Venkat Krishna Reddy Busireddy
Can you repeat the question?
Aditya
Card sales in rupee terms for this.
Murali Mohan Raju Reddycherla
Quarter. Is 2,29 crores.
operator
Okay, sir, thanks. Thank you. The next question is from the line of Mr. Rihan Syed from three Netra managers. Please go ahead.
Unidentified Participant
Yeah, good evening and thank you for. Giving me the opportunity. Of. Your voice is muffling. Can you repeat the question? Yeah, I’m talking about working capital cycle. Yeah, working capital. There will not be any major works of the inventory because data should be cash and carry. So we have a sufficient cash balance. If any inventory has to be built up, that will be met from our cash balances. Okay.
Unidentified Speaker
Can you repeat it? Your voice is margin, the guiding margin. Are you asking about profit margin of gross profit margin for the quarter it is 25.78 at a consolidated level and EBITDA margin is at around 8.19 and part margin is around 6.24. That’s right. 27. So that guidance number what we are saying is in absolute terms we will grow between around 15 to 20%. That is what we are expecting it.
Unidentified Participant
Yeah.
Unidentified Speaker
Similar.
operator
Thank you. The next question is from the line of Disha Giria from Ashika Institutional Duke. Please go ahead. Hi sir. My first question would be what would.
Disha Giria
Be the VAP sales growth year on year excluding the bulk sales and SMP. So value growth is 289 crores. Now as against last period is 278 the project growth. So if you talk about As a percentage 4% is the growth excluding bulk. Okay. So you mentioned previously that our Lassie sales, our Lassie volume had gone down drastically during the first quarter. And what would be your strategy going forward to revive that sales? Or are we seeing range in same. In this quarter already?
Venkat Krishna Reddy Busireddy
Normally now in the month of April, May when temperature is very high, the numbers are. Normally it will be very high. But you know in the month of from June onwards, you know numbers normally always it will be down. So if I’m selling a la buttermilk, you know in the month of June, July, August it will be only 10. It will come down to 10% only.
Unidentified Speaker
Yeah. So it is totally weather driven LA and buttermilk yeah, basically buttermilk. Madam, last time we have done around 45,000 liters. This time it was only 32,000 meters. And even last year also it is around 15,000 and it was around 14,000. So basically the major impact have happened in the buttermilk. Okay. And card generally we get a growth. That growth has not come. We little reduction there is not much. It is around 5%. 3% is the degrowth like what you mentioned earlier in the car.
Disha Giria
Okay, so my last question is in terms of gross profit. While I understand there was high procurement cost both in India and in Kenya. If I compare our standalone gross profit.
Unidentified Speaker
Decline with our closest competitor, our Decline is almost 2x of their decline in the same period. So I mean could you help me understand the same. If you see that.
Unidentified Speaker
Area advantage of Tamil Nadu being more and some competitors where we have apple to apple, it will be almost the same at least coming from an EBITDA level. Because gross sometimes depends on the way people do the costing. At an EBITDA level, competitors who are in the same region as what we have would be the same in terms of the decline in EBITDA from where they were. Some competitors who have more of higher volume from a particular state have the advantage of that state and their margins are a little better than the other competitors who are equal in this case.
Unidentified Speaker
So the our highest procurement comes from Andhra Pradesh, right? I think it is Karnataka followed by.
Disha Giria
All right. Understood sir.
operator
Thank you. Thank you. The next question is from the line of Mr. Kiran Kumar from Green Investors. Please go ahead.
Kiran Kumar
Good afternoon. Thanks for the opportunity. Am I audible? So my question is standalone business. I would like to know the revenue. Of a milk and current of standalone for Q1 versus Q5. Q1 25 standalone milk revenue is around 538. You are not here. 538Cr re. Okay. Last quarter same quarter. So 6% of growth in the revenue. Okay. Okay. Coming to. Coming to basically 2.4 crores current year. Last year. Last quarter it is a 210 crores. There is a 3% deduction.
Unidentified Speaker
Okay. Other than car excluding fact current unit is 76 crores. Last quarter it is 42 crores. And third quarter current quarter it is 45. Last quarter it is 41 crores. So 76 crores vap minus cr. Yeah. And 35 is 35 is fat and fat products. Basically butter and juice.
Kiran Kumar
I got it. Okay.
Unidentified Speaker
So we give this confirm if bulk. Total like bulk sale is only from standalone or. We don’t do any bulk. Sell in the Africa okay.
Parikshit Gupta
Thank you. That was my question. Thank you. Thank you. The next question is from the line of Parikshit Gupta from Fair Value Capital. Please go ahead. Thank you for the opportunity. I just want to confirm in terms of growth you mentioned a 15 to 20% growth. In terms of value. Correct.
Parikshit Gupta
15 to 20% in absolute growth. It has a T level. Understood. And in terms of top line, did you. What. What was that number?
Unidentified Speaker
And it will be 10 to 15%. Okay. And can you also tell me, you know a breakup, how much of it are you expecting from value added from liquid milk, Africa or Grafeed? If you can give a sense around that, please.
Unidentified Speaker
See. I think Africa will be on the higher teams. Orgasm will also be in the higher teams of growth. And India will be in that not 10 to 14%, 15% kind of a growth rate. So that is what we will look at it. We cannot be very precise because of seasonality. But we normally target as a.
Parikshit Gupta
Understood. In terms of my second question. Can. You please repeat that?
Unidentified Speaker
India will be politics. That’s what.
Parikshit Gupta
Understood. And does this also the India number. Does it also also include the OSAM brand? The contribution from additional revenue from osam.
Unidentified Speaker
We are not yet considered osam. Without OSAM is where we are looking at this. Lower teams of India. With OSAM it should be up a little on the higher teens. At the same within the 15% of growth.
operator
And just my last question. Can you also tell me about the regional revenue split? I do understand that it is primarily in the south. But can you bifurcate it for me a little, please?
Unidentified Speaker
Revenue. Overall revenue, sir. From Karnataka. Okay. We will have around 259 crores. Karnataka it is 279 crores. Tamil Nadu, it is 149 crores. Telangana, it is 119 crores. Excluding bulk. So bulk we have done around 57 crores. And from. In terms of the growth, which states do you think would be the greatest contributor to it? I just want to understand which states are doing expected to do well versus which months might be a laggard here. So excluding that it is almost 9.6. What we have grown it in India. Part of that 11% is 80 growth followed by. Sorry, Telangana 11.7. Tamil Nadu 10.3. Karnataka is 7.2. This is value. And going forward we expect to follow the status quo. Similar to that. Sorry, Similar growth. We are expecting it.
Parikshit Gupta
Understood. Those were all my questions. Thank you again. Thank you. As there are no further questions from the participants. I now hand the conference over to the management for closing comments.
Sunil Reddy
I would like to thank all the investors who came on the call. Thank you very much. If you have any other questions or you can always get in touch with our investor relation team from sba. Thank you.
operator
On behalf of Dodla Dairy limited that concludes this conference. Thank you for joining us. And you may now disconnect your lines.