When the seven bidders surveyed Danone’s only dairy facility in India, roughly the size of a football field, they thought it was tiny. But they were there for what it could produce—15 tonnes of thick, stirred, fruit-flavoured yoghurt every day. What’s more, its location on the outskirts of Delhi made it an ideal choice for distribution in north India. Crucially, acquiring the plant would give the new owners the advantage of entering the market before their competitors; a similar facility to Danone’s would take about a year to set up. Parag Milk Foods, whose Rs 30 crore ($4.4 million) bid was successful, seems to have understood the need to act fast if it is to succeed in the yoghurt sector.

Yoghurt, dahi’s strained, thicker and more nutritious cousin, is fast becoming the most attractive dairy product for Indian consumers and producers alike. Now readily stocked in most stores, a number of city dwellers have made yoghurt a part of their lifestyle. Apart from being tasty, it also aids in digestion, making it an ideal snack, especially in summers. The yoghurt producers, too, prefer selling yoghurt rather than dahi because consumers are willing to shell out a lot more for the former. It’s also a bet on the future, because estimates suggest that number of yoghurt consumers will double in the next three years.

All of this has been encouraging enough for Parag to double down on yoghurt. However, it must be remembered that Parag’s entry was made possible because Danone, the French dairy giant, threw in the towel. Danone decided to sell its facility and shut down its dairy operations in the country this April, around a decade after entering the Indian market.

“It failed because it played both sides of the coin. It tried to compete with dairy cooperatives in capturing mass market through dahi and vied for premium payers with Greek yoghurt,” said the founder of a health food startup, who did not want to be named. “Danone may have been overconfident targeting the high-end consumer without delivering an innovative product that deserved the premium,” he added.

Danone had introduced dahi, a range of yoghurt—both flavoured and Greek, and probiotic drink Yakult (as part of joint venture with Yakult). Barring Yakult, which Danone is continuing, these products largely failed to entice customers. With neither an exceptional product, nor a compelling brand story and at a markedly higher cost, Indian customers simply didn’t bite.

Now that Parag has won the bid for Danone’s state-of-the-art yoghurt plant, is one of India’s largest private dairies prepared to deliver where Danone failed?

Why sell milk, when you can make it better?

AUTHOR

Ruhi Kandhari

Ruhi writes on the impact of healthcare policies, trends in the healthcare sector and developments on the implementation of Electronic Health Records in India. She has an M. Sc. in Development Studies from the London School of Economics.

View Full Profile

Subscribe to read this story

The Ken is the only business subscription you need. Questions?

 

Premium

  • 5 original and reported longform business stories every week
  • Access to ONLY India edition
  • Close to 250 exclusive stories every year
  • Full access to over 5 years of paywalled stories
  • Pick up to 5 premium subscriber newsletters
  • 4 original and reported longform business stories each week
  • Access to ONLY Southeast Asia edition
  • Close to 200 exclusive stories every year
  • Full access to all paywalled stories since March 2020
  • Pick up to 5 premium subscriber newsletters

Rs. 2,750 /year

$ 120 /year

India Edition
Subscribe Subscribe
Most Asked For

Borderless

  • 8 original and reported longform business stories each week
  • Access to both India and Southeast Asia editions
  • Close to 400 exclusive stories every year
  • Full access to over 5 years of paywalled stories across India and Southeast Asia
  • Unlimited access to all premium subscriber newsletters
  • Visual Stories

Rs. 4,200 /year

Subscribe
 

Echelon

  • 8 original and reported longform business stories each week
  • Access to both India and Southeast Asia editions
  • Close to 400 exclusive stories every year
  • Full access to over 5 years of paywalled stories across India and Southeast Asia
  • Unlimited access to all premium subscriber newsletters
  • Visual Stories
  • Bonus annual gift subscription
  • Priority access to all new products and features

Rs. 8,474 /year

Subscribe
Or

Questions?

What kind of subscription plans do you offer?

We have three types of subscriptions
- Premium which gives you access to either the India or the Southeast Asia edition.
- Borderless which gives you complete access to The Ken across both editions
- Echelon which gives you complete access to The Ken across both editions along with a bonus gift subscription

What do I get if I subscribe?

The Premium edition gives you access to stories in that edition along with any five subscriber-only newsletters of your choice.

The Borderless and Echelon subscription gives you complete access to The Ken across editions and unlimited access to as many newsletters as you like.

What topics do you usually write about?

We publish sharp, original and reported stories on technology, business and healthcare. Our stories are forward-looking, analytical and directional — supported by data, visualisations and infographics. We use language and narrative that is accessible to even lay readers. And we optimise for quality over quantity, every single time.

Our specialised subscriber-only newsletters are written by our expert, award-winning journalists and cover a range of topics across finance, retail, clean energy, cryptocurrency, ed-tech and many more.

How many newsletters do you have?

We are constantly adding specialised subscriber-only newsletters all the time. All of these are written by our team of award-winning journalists on a specialised topic.

You can see the list of newsletters that we publish over here.

Does a Premium subscription to your Indian edition get me access to the Southeast Asia edition? Or vice-versa?

Afraid not. Each edition is separate with its own subscription plan. The India edition publishes stories focused on India. The Southeast Asia edition is focused on Southeast Asia. We may occasionally cross-publish stories from one edition to the other.

We recommend the Borderless or the Echelon Plan which will give you access to stories across both editions.

Do you have a mobile app?

Yes! We have a top-rated mobile app on both iOS and Android which allows you to read on-the-go and has some amazing features like the ability to bookmark stories, save on your device, dark mode, and much more. It’s really the best way to read The Ken.

Is there a free trial?

You can sign up for a free account to experience The Ken and understand our products better. We’ll send you some free stories and newsletters occasionally, and you can access our archive of previously published free stories. You can stay on the free account as long as you’d like.

The vast majority of our stories, articles and newsletters can be accessed only by a paid subscription.

Do you offer any discounts?

Sorry, no. Our journalism is funded completely by our subscribers. We believe that quality journalism comes at a price, and readers trust and pay us so that we can remain independent.

Do you offer refunds?

No. We allow you to sample our journalism for free before signing up, and after you do, we stand by its quality. But we do not offer refunds.

I am facing some trouble purchasing a subscription. What can I do?

Just write to us at [email protected] with details. We’ll help you out.

I have a few more questions. How can I reach out to you?

Sure. Just email us at [email protected] or follow us on Twitter.