Dodla Dairy Limited has informed the Exchange about Transcript
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Dodla Dairy is acquiring 100% of HR Food Processing Pvt Ltd, which operates the premium dairy brand 'Osam' in Bihar and Jharkhand, for an equity value of INR 271 crore (enterprise value INR 247.2 crore plus net cash INR 23.8 crore). The deal is fully cash, funded from Dodla's existing net cash balance, and is expected to close in 1-2 months. Osam's unaudited FY25 sales were INR 282.6 crore with a 25% gross margin, 5% EBITDA margin, and 3.2% PAT margin; the company has 25,000+ farmers, 1,000+ collection centres, 19 chilling centres, and two operational plants running at 70-75% capacity utilization. Management expects to lift margins and PAT to 15-20% levels over time using Dodla's operational expertise, while continuing its existing India organic growth target of 10% volume and 15% value growth. The sellers are exiting mainly because their private equity investors had reached the end of fund life, and a 3-year non-compete applies to the founders.
Shareholders should view this as a strategic, fully funded entry into East India with no leverage added. Margin upside from Osam is the key upside lever, but near-term consolidated margins may be modestly diluted given Osam's 5% EBITDA versus Dodla's higher base; management is confident of an upward trajectory rather than any margin hit.