Parag Milk Foods has announced plans to invest approximately ₹100 crore to quadruple its paneer manufacturing capacity from the existing 20 MT per day to 80 MT per day, as the company looks to expand its presence in India’s organised paneer market.
The expansion will be undertaken at the company’s facilities in Manchar, Maharashtra, and Palamaner, Andhra Pradesh. The additional capacity is expected to be commissioned by June 2027 and will include production of both regular and high-protein paneer.
The company said the investment will add 60 MT per day of paneer capacity. The expansion is planned through a combination of brownfield and greenfield initiatives and is expected to be funded through internal accruals, borrowings or lease arrangements.
Paneer is one of Parag Milk Foods’ flagship value-added dairy categories. The company said its paneer business has grown 28% over the past two years, while value-added products account for more than 90% of its turnover.
Parag said the expansion is aimed at addressing near-full utilisation of its existing paneer capacity and responding to a shift in demand from unorganised to organised players. According to the company, organised players currently account for only around 5–6% of the Indian paneer category, indicating substantial room for branded and organised products to expand.
The company also highlighted its technology-led approach to fresh paneer manufacturing. Its branded paneer has a shelf life of up to 75 days without preservatives, supported by its manufacturing and packaging technology.
With the additional capacity, Parag Milk Foods plans to increase paneer availability through General Trade, Modern Trade, Quick Commerce, e-commerce and Hotel, Restaurant and Catering (HoReCa) channels. The company said its pan-India distribution network will support the wider market reach.
The company’s latest expansion comes as it continues to strengthen its value-added dairy portfolio. In Q1 FY27, Parag Milk Foods reported consolidated revenue of ₹945 crore, an 11% year-on-year increase, while consolidated net profit declined 20% to ₹22 crore.
The planned capacity addition reflects the company’s focus on paneer as a growth category and its strategy of combining manufacturing scale, product innovation and wider distribution to build its presence in organised dairy.
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