Dairy tech firm Stellapps diversifies into milk procurement

Stellaps Technologies, a digital solutions provider for dairy supply chain has diversified into milk procurement; and has started sourcing milk for large brands such as ITC and CavinKare.

The company, which is building a milk-procurement-network also proposes to provide extension-services including agri-inputs such as feed; fertilisers and supplements to the dairy farmers.

Over the past few months, Stellaps has started milk procurement operations in Kolar district of Karnataka and Eastern Uttar Pradesh. “We are have started procurement in these two-clusters now and plan to setup 18-more such-clusters over the next 12-18 months;” said Ranjith Mukundan, CEO, Stellapps Technologies Pvt Ltd.

Eastern India is a good market

“We see Eastern India as a good market, where there are not too many players;” Mukundan said adding that the company was ramping up procurement operations in the region. Presently, Stellapps procures around 30,000 litres per day of which 18,000 litres is from Eastern UP and rest in Kolar. The company currently operates about 400 milk procurement centres in these two clusters; where at least 100 farmers are actively pouring milk at each of these centres.

Commenting on the diversification strategy, Mukundan said the idea is to enable data-driven premium-market linkages. It will be done by becoming a demand fulfilment partner sourcing high quality assured milk for the consumer brands; launching differentiated milk and milk-based products such as paneer, cheese and flavoured milk among others.

Stellapps has been providing a suite of technology solutions including traceability for automating the Indian dairy sector since 2011. It has over 250 customers including all major private and co-operative dairies. It plans to leverage its existing pan India footprint for the proposed diversification. “We currently digitise about 13.5 million litres of milk flow every day in over 36,000 villages; directly impacting over 3 million registered farmers,” Mukundan said.

I million LPD target in 700 days

Stellapps is targeting procurement of 1-million litres over next 24 months and has started on-boarding talent on pan India basis. It is also in advanced stages of raising a multi-million dollar funding to finance the diversification-plans over the next 18-months.

Incubated at IIT Madras, Stellapps, so far, raised about $20 million from investors including Omnivore, Gates Foundation, Qualcomm, ABB Ventures, WRVI Capital, Blume Ventures and Venture Highway.

Stellapps is planning a supply chain to feed into the top twenty cities and the proposed clusters would be closer to identified cities such as Coimbatore, Vizag, Jaipur, Pune, Lucknow, Kanpur and Patna among others, Mukundan said. T

Leasing Dairy Plants

The company plans to lease out the dairy processing plants and has started identifying capacities near Mysore, Erode, Patna and Lucknow. “We plan to take the processing units on lease basis depending on the volumes and run it on our quality standards,” he said.

Stellapps, which has clocked an annual turnover of over Rs 100 crore, is eyeing Rs 170 crore for the current financial year.