Parag Milk Foods Hits Record Revenue; Profit Dips Amidst Inflation

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Author Kavya Nair | Published at:
Parag Milk Foods Hits Record Revenue; Profit Dips Amidst Inflation
Overview

Parag Milk Foods achieved its highest-ever quarterly revenue of INR 1,013 Cr in Q3 FY26, a 14% YoY jump fueled by 8% volume growth and strong performance in core categories and its 'New Age Business' (+123% YoY). However, soaring milk prices (+20% YoY) compressed margins, leading to a 3% EBITDA fall and an 18% YoY decline in reported Profit After Tax (PAT) to INR 30 Cr. For 9M FY26, revenue grew 14% to INR 2,872 Cr, with PAT up 11% to INR 103 Cr.

📉 The Financial Deep Dive

Parag Milk Foods Limited (PMFL) announced its Q3 FY26 results, showcasing robust top-line growth alongside significant profitability challenges. The company posted its highest-ever quarterly revenue of INR 1,013 Cr for the quarter ended December 31, 2025, marking a substantial 14% year-over-year (YoY) increase. This growth was underpinned by an 8% YoY volume expansion, with core categories like Ghee, Cheese, and Paneer witnessing a 21% value growth and 12% volume increase. The high-growth 'New Age Business' segment, encompassing Pride of Cows and Avvatar, surged by an impressive 123% YoY, contributing 9% to the year-to-date revenue.

However, the surge in commodity prices, particularly a 20% YoY increase in milk prices, significantly impacted profitability. Gross Profit rose 9% YoY to INR 262 Cr, but Gross Profit Margin (GPM) contracted to 25.9% from 27.2% YoY. EBITDA saw a 3% YoY decline to INR 77 Cr, with the EBITDA margin shrinking to 7.6% from 9.0% YoY. Reported Profit After Tax (PAT) fell 18% YoY to INR 30 Cr, although PAT adjusted for exceptional items (PAT bei) stood at INR 35 Cr, down 2% YoY.

For the nine-month period ended FY26 (9M FY26), revenue reached INR 2,872 Cr, a 14% YoY growth. Gross Profit grew 15% YoY to INR 755 Cr, with GPM seeing a marginal improvement to 26.3% from 26.0% YoY. EBITDA grew 6% YoY to INR 232 Cr, but the margin was 8.1% compared to 8.7% YoY. PAT for 9M FY26 rose 11% YoY to INR 103 Cr, with PAT (bei) growing 17% YoY to INR 109 Cr.

Sequentially, PMFL managed to maintain its gross margin at 25.9% despite a 6.5% rise in milk prices from Q2 to Q3 FY26, leveraging pricing strategies and portfolio mix.

🚩 Risks & Outlook

The primary risk identified is the persistent commodity inflation, especially in milk prices, which is expected to continue. Management remains confident in navigating these challenges through brand strength, product innovation, and disciplined distribution expansion. Strategic priorities focus on new product development and premiumization.

Note: Specific details on the balance sheet, cash flow statement, net debt, or key financial ratios like ROE/ROCE were not provided in this release.

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