Axis Capital Limited, ICICI Securities Limited
Dodla Dairy Limited was incorporated on May 15 1995 at Hyderabad. Dodla Dairy is an integrated dairy company based in south India primarily deriving all of their revenue for Fiscal 2020 and for the 9 months period ended December 31, 2020 from the sale of milk and dairy based Value Added Products (“VAPs”) in the branded consumer market. Its Indian operations are mainly undertaken under the brand name of “Dodla”, “Dodla Dairy”, and “KC+” whereas it serves overseas market under the brand name of “Dodla Dairy”, “Dairy Top”, and “Dodla+”. Telangana, Andhra Pradesh, Karnataka, Tamil Nadu, and Maharashtra are the key Indian market segments served by the company while in the overseas market, it mainly serves countries like Uganda and Kenya. It has a total of 13 processing plants to process raw material into packaged milk and manufacture dairy-based value-added products. The firm has a strong distribution network of 40 sales offices, 3336 distribution agents, 863 milk distributors, and 449 product distributors across 11 states in India. Dodla Sunil Reddy, Dodla Sesha Reddy, and Dodla Family trust are the company promoters.
For year/ period ended ( in Cr.)
|31 Mar 2021||31 Mar 2020||31 Mar 2019|
|Profit After Tax||49.87||62.76||56.85|
The Company has performed very well & reported super earnings in the pandemic period of FY21. Based on the FY20 earnings the issue is priced at P/E multiple 51 times which fully priced. The company plans to add milk products going forward which makes it a long term bet. Investors may consider an investment with a long term perspective.