Milk Mantra Joins Hatsun Agro as Wholly-Owned Subsidiary in INR 233 Cr Deal The deal is aimed at expanding HAP's presence in Eastern India, particularly in Odisha, where Milk Mantra's flagship brand 'Milky Moo' enjoys a strong market presence.
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Hatsun Agro Product Limited (HAP), a prominent dairy product manufacturer, has announced the acquisition of 100% share capital in Milk Mantra for INR 233 crore (USD 27.5 million).
The deal is aimed at expanding HAP's presence in Eastern India, particularly in Odisha, where Milk Mantra's flagship brand 'Milky Moo' enjoys a strong market presence.
The acquisition will be executed through a series of Share Purchase Agreements (SPAs) and other transaction documents with Milk Mantra's current promoters and shareholders. Following the completion, Milk Mantra will operate as a wholly-owned subsidiary of HAP, as per the company's stock exchange filing.
Milk Mantra, established in 2009, has raised nearly USD 35 million from investors such as Aavishkaar Venture Capital, Fidelity Growth Partners, Neev Fund, Eight Roads Ventures, and US-based DFC.
The Bhubaneswar-based company offers a wide range of products, including milk, curd, cottage cheese, buttermilk, and cattle feed. Despite its innovative branding and strong regional foothold, Milk Mantra has struggled to achieve significant growth. The company's operating revenue stood at INR 276.42 crore in FY24, with a profit of INR 9.78 crore. However, revenue growth has been stagnant over the last three fiscal years, falling short of its ambitious target of INR 1,000 crore by 2026.
Industry analysts view this acquisition as a slump sale, given the valuation of INR 233 crore, which is less than 1x sales. This reflects challenges such as a high reliance on liquid milk, where margins are constrained, and the inability to pivot towards high-value segments like A2 milk. The move aligns with HAP's strategy to strengthen its portfolio and geographical reach at a reasonable cost.
HAP, a Chennai-based publicly listed company, is among India's leading dairy players. The acquisition is expected to bolster its footprint in the Eastern region without causing significant shifts in its stock price. Meanwhile, Milk Mantra faces competition from new-age companies like Country Delight, Akshayakalpa, and Sid's Farm.
This deal underscores the 'grow or die' mantra of the dairy industry, as Milk Mantra's limited scalability and revenue stagnation paved the way for its acquisition. For HAP, the transaction represents a strategic fit, enhancing its market presence and product portfolio in the dynamic Indian dairy sector.
