According to reports from Moneycontrol News, Milkfood Ltd has signed an agreement to sell its dairy plant located at Agwanpur in Moradabad for ₹130 crore. The transaction has resulted in a net cash inflow of ₹116.11 crore after taxes, marking a decisive step in the company's ongoing business reorganisation and deleveraging strategy. The sale generated significant profits, with ₹78.04 crore net profit on land and ₹7.54 crore profit on buildings, while the company reported no loss on the sale of plant and machinery.
As reported by Moneycontrol News, Milkfood plans to use ₹75 crore from the proceeds to repay loans, a move expected to reduce annual finance costs by ₹9.25 crore. The company will also benefit from savings of nearly ₹8.5 crore annually in plant-related overheads, bringing the combined annual benefit to approximately ₹17.75 crore. These measures are expected to lead to an earnings accretion of approximately ₹7.25 per share (face value ₹5), reflecting the immediate financial upside of the asset sale.
According to Moneycontrol News, Sudhir Avasthi, Managing Director of Milkfood Ltd, stated that the transaction reflects a disciplined approach to capital allocation. He emphasized that by monetising a non-core asset, the company is meaningfully reducing debt, improving cash flows and creating financial headroom to pursue growth opportunities. The strategic move demonstrates the company's focus on optimizing its asset portfolio while strengthening its financial position.
As reported by Moneycontrol News, the company plans to invest in new capacities, including ice-cream manufacturing, while also evaluating expansion opportunities in cheese and butter segments, which continue to see strong demand in urban and semi-urban markets. Operationally, Milkfood intends to scale up production at its Patiala facility, with the company estimating that turnover could reach ₹750 crore by FY27, targeting EBITDA margins of around 7 percent.
According to Moneycontrol News, industry watchers view the Moradabad asset sale as part of a wider trend of companies unlocking value from industrial land and manufacturing real estate to strengthen balance sheets and fund growth. The transaction underscores the value of industrial real estate assets in the region, with the company recording a reversal of ₹37.37 crore from revaluation reserves as a non-cash accounting adjustment related to the sale.
