Milky Mist takes D-Street leap for national footprint

CHENNAI: Erode-based dairy and packaged food major Milky Mist Foods has marked a significant milestone with its maiden public issue receiving 100% subscription, as the Rs 1,553-crore IPO, including Rs 125 crore of offer for sale, closes today.

For a company that has grown largely through internal accruals since its beginnings in the 1990s, the entry into the capital markets is a defining moment. “We had the guts to reach Dalal Street,” said Sathishkumar T, chairman and managing director, Milky Mist, tracing the company’s journey from paneer manufacturing in 1991 to a diversified packaged food business.

Milky Mist has invested about Rs 2,500 crore in its growth journey without raising external capital until the IPO. Sathishkumar said the company’s “secret sauce” behind more than 30% topline growth was its integrated farmer network of 80,000 milk suppliers and its focus on branded, quality-assured products.

Paneer, traditionally associated with north India, has emerged as one of Milky Mist’s strongest categories in the south. The company claims about 20% of the national paneer market, with 65% of its business coming from the southern side. It has also established a presence in cheese, yoghurt, 1-kg curd and probiotics.

CEO and whole-time director K Rathnam said the company’s strategy of converting surplus milk fat into ghee and butter, while continuously expanding its product portfolio, had strengthened its business model. Its curd launches in markets such as Patna, Ahmedabad and Bihar have gained traction, he said, while a robust supply chain helped overcome gaps in cold-storage infrastructure.

The company’s transformation accelerated with its Rs 480-crore greenfield investment in 2016. “We went fully operational in 2019,” Rathnam said, adding that this expansion laid the foundation for Milky Mist’s ambition of becoming a national brand.

Its second phase of expansion between 2020 and 2025 brought ice creams, probiotics, milkshakes and other long-life products into the portfolio, positioning Milky Mist as a breakfast-to-dinner packaged food company. Paneer volumes have grown 25%, with an additional 100-tonne capacity taking its single-roof manufacturing capacity to 192 tonnes, among the largest in the country.

With exports already reaching 22 countries, the company is now turning its attention to protein-led products. It has acquired 50 acres in Maharashtra and plans to set up another plant there within four years, Rathnam said, signalling that the next phase of Milky Mist’s journey will be about taking its southern success to a truly national footprint.