India's dairy majors pivot to value-added products as organised VAP market nearly doubles to Rs 1.46 lakh crore by FY25

Mother Dairy, Amul, Hatsun, Heritage Foods and Milky Mist ramp up curd, ghee, paneer and protein lines for margin growth; Mother Dairy's VAP revenue almost doubled from Rs 10,450 crore (FY20) to Rs 20,300 crore (FY26), now 28% of dairy sales.

— Source publishedMon, 20 Jul, 2026, 12:25 IST·First seen Mon, 20 Jul, 2026, 13:31 IST·Source Business Today · Latest

What happened

Indian dairy majors (Mother Dairy, Amul, Hatsun, Heritage Foods, Milky Mist, Godrej Jersey, Nestlé India, Parag Milk Foods) pivot to value-added products—curd,

Key facts

  • Rs 10,450 crore FY20 VAP revenue
  • Rs 20,300 crore FY26 VAP revenue
  • 28% VAP share of Mother Dairy dairy revenue
  • Rs 85,000 crore FY20 organised VAP market
  • Rs 1.46 lakh crore FY25 organised VAP market
  • Rs 9,973 crore Hatsun FY26 revenue
  • Rs 233 crore Milk Mantra acquisition
  • Rs 4,550 crore Heritage Foods revenue
  • 18% YoY VAP growth Heritage Foods
  • 35.5% VAP contribution Heritage Foods
  • Rs 2,350 crore Milky Mist FY25 revenue
  • Rs 1 lakh crore Amul FY26 revenue
  • $912.9 million India protein supplements market 2025
  • $1.6 billion projected 2034

Why this matters

Rapid VAP growth across Mother Dairy, Amul, Hatsun, Heritage and Milky Mist signals a ripe window for M&A or partnerships targeting niche protein/ghee/paneer brands to accelerate category entry.

What to watch

  • Milk procurement price spikes (monsoon/fodder cost shocks)
  • Entry of FMCG majors (ITC, Nestle) into paneer/protein/ghee segments
  • Mother Dairy or Amul IPO/listing signals requiring margin transparency
  • Consumer price inflation data on ghee/paneer suggesting demand elasticity limits
  • State government dairy cooperative policy changes affecting procurement pricing
  • Track capex announcements from Amul, Mother Dairy, Hatsun for new VAP plant capacity over next 2 quarters
  • Monitor milk procurement price trends (fat/SNF rates) as leading indicator of margin pressure
  • Watch for M&A activity among regional dairy brands as scale players expand VAP distribution
  • Compare quarterly VAP revenue mix disclosures across listed players (Heritage, Hatsun) for share-of-sales trend continuation