India based HR Food Processing, the owner of Osam Dairy, has raised INR450m ($6.6m) in a new funding round to expand its milk production capacities.
Lok Capital and existing investor Aavishkaar led the Series B funding round, reported The Hindu Business Line.
Based in Ranchi in Jharkhand state, HR Food Processing had earlier raised INR150m ($2.2m) from Aavishkaar in 2013.
The dairy start-up began its commercial operations in May and has been manufacturing its products under the Osam Dairy brand.
HR Food Processing’s products include two milk varieties, curds, paneer, lassis, butter milk and a milk-based sweet called peda under the Osam Dairy range, reported the live mint.
HR Food Processing CEO and co-founder Abhinav Shah was quoted by the publication as saying: “Like most other dairy markets, we compete against state-run cooperatives. Today, private sector players have a belief that there is a great opportunity for them, given the demand supply gap and the huge customer requirement for quality products.”
Currently HR Food Processing has two dairy processing plants at Ranchi and Jamshedpur. While the Ranchi dairy factory can produce 80,000ltrs of milk per day, the other plant at Jamshedpur, a recent acquisition, has a processing capacity of 1,20,000ltrs of milk per day.
However, the Jamshedpur dairy factory is currently under renovation and is likely to begin commercial production by April 2017
Proceeds from the new funding round will also be utilized by HR Food Processing to boost its distribution network.
As of now, the dairy company is confined to parts of Jharkhand state with over a hundred distributors and presence in 3,000 retail units.
It is looking to cover the entire state of Jharkhand by the early part of 2017 besides expanding its footprint in the neighbouring state of Bihar.
