KMF eyes new markets, exports to achieve ₹25,000-crore sales

In talks to buy dairy plant in western India to expand base

January 23, 2020 10:51 pm | Updated 10:51 pm IST - MUMBAI

Karnataka Milk Federation (KMF), the second-largest milk co-operative after Amul and which manufactures and retails its products under the Nandini brand, has announced plans to penetrate new markets and enhance milk procurement by over 20% in six months to meet the projected demand.

The company has chalked out plans to increase the milk output to 1 crore litres per day, a top official said.

“In consultation with our chairman, we have decided to increase procurement of milk to 1 crore litres per day within six months, from 80,000 lakh litres per day. We will do this by getting more co-operatives under our fold and increasing the number of cows our farmers have,” B.C. Sateesh, managing director, KMF, said in an interview. He said KMF, which was focussing on value-added milk products for better yields, was planning to supply these products all over India in the next 18 months. “Currently, except for four States, we are present everywhere. Our aim is to cover the whole of India and we are doing it,” he said.

KMF is also laying emphasis on exports. After finding success in the Singapore market, KMF has initiated talks with suppliers in West Asia to export cow ghee, which is in demand there.

“The UAE market is very promising and we will start exports to that country shortly. It is a ₹300-crore market for ghee and we expect good response,” Mr. Sateesh said. Currently the company has 100 types of products in its portfolio which will be introduced in different markets in phases, he said.

KMF is increasing its presence in Maharashtra and is close to acquiring a dairy plant. Negotiations are on with three companies and an announcement is imminent. “I have visited facilities in Panvel near Mumbai and Goa. I am going to see a facility in Pune. We will be announcing the acquisition soon. There is also proposal for contract manufacturing,” he said.

After successfully introducing Nandini branded milk and milk products in Maharashtra, mainly Mumbai, about three years ago, KMF has now introduced Nandini cheese. Initially it will focus on the institutional market of Mumbai which comprises hotels, restaurants, cafés and B2B sector.

It is targeting a 20% market share of cheese of this institutional segment in Mumbai within two years, top executives said.

KMF, which has a turnover of over ₹15,000 crore, is eyeing ₹25,000 crore in sales over years.

Having invested ₹2,000 crore in building plant and infrastructure, KMF will now invest ₹100 crore every year on both green field and brown field expansion within Karnataka and elsewhere, officials said.

“Nandini’s cheese manufacturing plant is spread across 45 acres and has come with an investment of ₹600 crore. We expect to capture major chunk of institutional cheese market in Maharashtra,” M.T. Kulkarni, marketing director, KMF, said.

“Our cheese plant has a capacity 40 metric tonnes per day, which can be increased by ten-fold,” he said.

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