Milky Mist Dairy Food shares surge 10% on strong Q1 growth

ET Intelligence Group: Shares of Milky Mist Dairy Food were locked in upper circuit of 10% after delivering strong growth in the June 2026 quarter, driven by broad-based momentum across its product portfolio. In the first reporting quarter after listing on bourses in August, EBITDA margin expanded on the back of operational efficiencies, higher volume, an improved product mix, and better pricing realization. The company expects to sustain growth momentum through existing capacities, protein-led products and deeper penetration outside South India.

Yogurt and ice cream emerged as the standout categories, posting year-on-year revenue growth of 153% and 60%, respectively, aided by an extended summer season. Cheese revenue increased 38%, while paneer, the company's largest category, grew 34%. Milky Mist believes that the Perundurai facility still has significant spare capacity and, at current product prices, can potentially support revenue of 3-3.5 times FY26 levels before a new manufacturing facility is required. This provides substantial headroom for growth while supporting operating leverage.

While paneer remains the cornerstone of the business, Milky Mist is increasingly focusing on protein-rich products such as high-protein paneer, high-protein cheese, Greek yogurt and Skyr. It also plans to commission a whey protein concentrate plant over the next 15-18 months, allowing it to extract greater value from the whey generated in its cheese and paneer operations. In addition, it commissioned a 120-tonne-per-day natural cheddar cheese plant during the quarter.


Geographic expansion is another important growth driver. Although South India contributes nearly 69% to revenue, other markets are growing faster and are expected to account for around 40% of the business over time. The company expects to achieve this by strengthening distribution network, expanding cold-chain infrastructure and scaling up milk procurement operations in states such as Karnataka and Maharashtra.

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Milk inflation poses as a key near-term risk. However, the company believes its diversified portfolio of value-added dairy products provides adequate pricing power to manage input-cost pressures. It expects margins to benefit from a richer product mix, better capacity utilisation and continued operational efficiencies.

Overall, Milky Mist's medium-term growth story extends beyond paneer. The focus is increasingly on sweating existing assets, scaling protein products, expanding cheese and yogurt, and increasing penetration outside South India while maintaining profitability growth.