Fund Raising for A2 based dairy unit at Nagpur

Apr 18, 2020 in Dairy Farming
Posted By : Pranesh Jain


Opportunity: 90% of Nagpur population consumes processed packaged milk while remaining 10% consumes local Gawli's milk. Here’s the key opportunity to serve pure and farm fresh milk from Desi GIR Cows with pure and organic Ghee/Paneer as allied products.

Problem: Mindset of consumer to chose over a brand (being established name) and lack of knowledge on how milk is processed and level of adulteration and chemicalisation of milk by such brands. 
Comparing price of packaged milk with pure and fresh milk from GIR Cows.

Business & Customer PropositionGAU VARDAAN is a disruptive business of changing the way milk is served and consumed by providing pure and fram fresh GIR Cow Milk in glass bottles, as hallmark of purity. We work on home delivery model with presently serving approx 500+ families across Nagpur city. With about 600 GIR Gauvansh, GAU VARDAAN is already leading in Nagpur market with about 375 ltrs/day milk supplies. Additionally we have established customer base for 60-75 kgs/month Bilona Vedic Ghee and 60-75 kgs per month Paneer all served on home delivery basis.

“Nagpur Population – Approx 4.00 million

Average Milk Consumption – 1.2 Million litres/day

Milk Availability – 100% A1 type from brands like Amul, Haldiram, Dinshaw, and Govardhan or local Gawli (in every area) having 5-7 cows per shed.

Potential Market for GAU VARDAAN in 2020

Population: 4 million

Average member/family – 4 i.e. 1 million families

Assuming only 10% of population open to buy A2 milk, potential demand is 100,000 litres/day while supply is only about 375 litres/day.”


Ø  GAU VARDAAN – A2 Type pure and raw farm fresh milk is being packaged in glass bottles under 2-4 degrees centigrade.

Ø  In-house delivery team to deliver milk on Motor-Cycles/Moped carrying 50 ltrs (max capacity) per vehicle. Supplies done early morning 5.30am – 8.00am

Ø  Gau Vardaan has present herd size of adapted 600 GIR Gauvansh and is aiming to adapt another 400-500 GIR Gauvansh for breading at its own farm land, being leased, for fodder, breeding, and plantation.

Ø  Educative marketing is key to address the problem which on conversation makes potential consumer convet to

Ø  Positioning ourselves not on basis of volumes but purely on Quality basis. Purity and Freshness of Milk reaching out to households who appreciate quality over pricing.

Promoter and The TeamAayush Lohia, a 1st generation entrepreneur, MBA in Marketing, belongs to a business family traded in Iron Ore for 13 years before it was his conscious call to serve Desi Cows and human society at large, both. Ideal way to do so was to launch GAU VARDAAN with commercial socio-economic perspective for more effective and efficient handling of such social disturbance where milk which is key food has itself turned to be slow poison due to adulteration.

Identifying the need to preserve and serve Desi Indigenous Cows and the immense benefit of raw and farm fresh milk, Aayush took upon a mission and undertook intense training at GoVigyan Anusandhan Kendra, Deolapar, under the auspice guidance of Shri Sunil Mansingka to understand cows and their habitat. Having Shri Mansingka as his mentor and advisor, Aayush embarked upon the journey to form GAU VARDAAN (Blessings of Mother Cow) which he formed in 2019 after 2 years of detailed study.

Other team members:
Bhushan Jepulkar – Business Head.
Marketing Team – 2 persons
Delivery Team – 10 persons
Mentor & Advisor on-board: Shri Sunil Mansingka, Member Kamdhenu Aayog Yojana and Chief Coordinator of GoVigyan Anusandhan Kendra (Deolapar)

What’s the Edge?Largest single location herd size of 600+ GIR Gauvansh and additional 500 GIR Gauvansh to be added soon.Pure and farm fresh milk from riches breed of indegenous GIR Cows.Non-Processed, free from chemicals/preservatives and milk powder.Home delivery in glass bottles.Pure Bilona Vedic Ghee (wood curd churned) and Organic Paneer free from chemicalsApp based customer service and back-office integration for data analysis.Maximum market coverage with potential to reach 2000 ltrs/day.

Geographical scopeMilk:- Nagpur City: Market size of 15,000 ltrs/day by 2025
Nagpur vicinity: Market size of 5000 ltrs/day by 2025

2025 onwards: Replicate model in key locations across India i.e. Jaipur, Kolkata, Bengaluru, Bhopal, Delhi NCR, Mumbai Metropolitan Region, Lucknow, etc.

Ghee: Pan India and Overseas across major multilevel Supermarket and business collaborations with Nutritionists.

Current Status & Key Business Metrics – Eversince launch dated 4th July 2019
Milk Sales:                              74,044.50 ltr (Rs.5,291,432/-)

Paneer Sales:                         232.68 kg (Rs.93,072/-)

Ghee Sales:                             351 kg (Rs.751,026/-)

GAU VARDAAN is leading in Nagpur with 5 other peers selling 250 – 300 ltrs/day milk and do not have any other products like Ghee/Paneer.

Project details like capacity, present stage etc.

2019-2020 – Soft lauch done on 4th July 2019, 600+ GIR cows adopted (single Gopalak at one location)
: Expected Capacity utilisation - 2000 Ltrs/day Milk production by 31/03/2020
                                                     - 300 Kg/month Traditional Bilona Ghee production
                                                       - 20 kg/day Paneer (cottage cheese) from Pure Desi Cow Milk.
: Current Capacity (post soft launch): 375+ litres/day under make shift arrangement to ensure brand presence in market and gradual marketing to achieve full volume.  Already produced and sold about 250 kgs Ghee and daily producing 2 kg Paneer as trial lots.

Dairy Farm operational from October 2020 onwards

: Acquire 250 - 300 acre farm land in Malegaon Bk (near Gondkheri) on long term lease for 30 years with 50 acres on Hire Purchase model to be bought within 5 year period. 
: Acquire 50-100 acres on Hire Purcashe with 1st 2 years being on lease and buy-out from 3rd year – 5th year or single baloon payment in 4th year.
: Dairy Farm to be developed and ready for operations from FY 2020-2021 onwards.
: Jinjwa plantation to be done for our cow’s grazing with other organic cultivation of fodder like Maize, Jowar and vegetable.s Other bi-products like Organic Compost and Organic Pesticides (made from Gomutra / Gobar) to be produced too.
: Other bi-products like Bio-Gas, Gomutra Arc, Organic veggies to be produced as self-sustainable model using indegenous cows.

Funding required, End use and Exit plan
Required Fund: Rs.30,000,000Tenure: Minimum holding for 7 years, exit between 8th – 10th Year by buy-back Instrument: Preference Shares, both, Convertible and Redeemable Preference Shares.


Exit Route & ROI/Returns to the Investor:  50% Investment under Reedemable Pref. Shares – Issued @ Rs.10 eachAnnual ROI for Redeemable Pref. Shares @ __% pre-fixed dividend p.a.

Ø  Redeemable Preference Shares: Promoters/Company to redeem the shares (fully) at the end of 7th years on its Face Value i.e. issue price at par.


B)    50% Investment under Convertible Pref. Shares - Issued @ Rs.10 each

Ø  Converted to Equity at face value.

Ø  Company/Promoter to buy-back equity holding between 8th – 10th year with a Share Premium (Pre-Fixed Rs.20 per share or NPV whichever is higher) over the issue price.

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