MUMBAI: Parag Milk Foods plans to invest approximately ₹100 crore to expand its paneer manufacturing capacity by 60 tonnes per day (MT/day) across its facilities in Manchar, Maharashtra, and Palamaner, Andhra Pradesh, the company said on Tuesday.
The expansion will increase the company’s overall paneer production capacity from the current 20 MT/day to 80 MT/day, representing a fourfold increase. The expanded facilities are expected to be commissioned by June 2027.
Expansion to Cover Regular and High-Protein Paneer
According to the company, the additional capacity will be used to manufacture both regular paneer and high-protein paneer.
Parag Milk Foods COO Rahul Kumar Srivastava said the capacity expansion would support wider distribution of the company’s paneer products across India and increase their availability through different retail and distribution channels.
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The company said the investment reflects its strategy of expanding its presence in value-added dairy products through increased manufacturing capacity, product innovation and wider market access.
Paneer Reported as a Key Growth Category
Parag Milk Foods said value-added products account for more than 90% of its turnover, with paneer among its flagship categories.
According to the company, its paneer business has recorded an annual growth rate of approximately 28% over the past two years.
The planned capacity expansion comes as organised dairy companies seek to increase their presence in categories traditionally dominated by smaller and unorganised producers.
Company Targets Growing Organised Paneer Market
Parag Milk Foods said organised players currently account for only around 5–6% of the paneer category, leaving significant room for expansion.
The company intends to use the additional capacity to serve growing demand for standardised-quality paneer, while expanding its national distribution network across both conventional and high-protein products.
The move also reflects a broader shift in the dairy industry towards value-added and protein-focused products, as manufacturers invest in products positioned around convenience, nutrition and consistent quality.
Capacity Expansion to Strengthen National Distribution
With the proposed addition of 60 MT/day, Parag Milk Foods will have substantially higher paneer manufacturing capacity once the projects are commissioned.
The company said the expanded production base will support its efforts to increase pan-India availability and strengthen its position in the organised value-added dairy segment.
The actual contribution of the new capacity to sales and market share will depend on commissioning timelines, utilisation levels, distribution expansion and consumer demand after the facilities become operational.
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