Plans to invest ₹100 Crore to add a new 60 MT/day facility, taking total paneer capacity from existing 20 MT/day to 80 MT/day; expansion to strengthen flagship category with pan-India distribution
Parag Milk Foods Limited, one of India’s leading dairy and nutrition companies, plans to invest approximately ₹100 crore to expand its paneer manufacturing capacity from existing 20 MT/day to 80 MT/day at Manchar (Maharashtra) and Palamaner (Andhra Pradesh). The expanded facilities will produce both regular and high protein paneer and are expected to be commissioned by June 2027.
Value added products contribute more than 90% of the company’s turnover and Paneer is one of its flagship categories which is growing by 28% per annum over the last two years. The investment builds on Parag’s technology-led innovation in fresh paneer. Its branded paneer offers a shelf life of up to 75 days without preservatives, enabled by its advanced manufacturing and packaging technology.
Paneer is one of the largest categories in Indian dairy. Demand is shifting from unorganised to organised players, which account for only about 5-6% of the category today, as consumers look for higher and more consistent quality. To capitalise on this shift, Parag is quadrupling its capacity. This will allow the company to strengthen its national footprint across both its standard and high-protein ranges.
Parag will use its manufacturing capabilities and pan-India distribution network to make paneer more widely available across General Trade, Modern Trade, Quick Commerce, E-commerce and HoReCa. The combination of manufacturing scale and packaging innovation will support distribution of branded paneer over longer distances and across channels, while maintaining the freshness and quality consumers expect.
The investment is part of Parag’s strategy to build scale in high-growth value-added categories, strengthen its flagship brands and create differentiated products through innovation. It also responds to rising consumer preference for branded, packaged and standardised products.
Rahul Kumar Srivastava, COO, Parag Milk Foods Limited, said:
“Paneer is an important part of the Indian consumer’s diet. We have the manufacturing excellence to maintain the freshness and quality of paneer over an extended period. We are pleased to announce our plan to add 60 MT/day of capacity, taking our overall paneer capacity from 20 MT/day to 80 MT/day. This scale-up will allow us to expand our pan-India distribution and make our paneer available across distribution channels. We see a significant opportunity to strengthen our position in value-added dairy through innovation, scale and wider consumer access.”
According to IMARC report, the Indian paneer market was valued at ₹73,140 crore in 2025 and is projected to reach ₹2.15 lakh crore by 2034, growing at a CAGR of 12.34% between 2026 and 2034. Growth is driven by rising demand for protein-rich foods, a growing preference for branded and packaged dairy, organised retail, and the expansion of e-commerce and quick-commerce channels.
