NEW DELHI: With the GST Council’s decision to impose 5% GST on packaged curd, lassi, buttermilk to foodgrains coming into force, India’s largest dairy Amul has raised prices of some of the products in these categories by Rs 1-4 with effect from July 19.
According to RS Sodhi, managing director of Gujarat Cooperative Milk Marketing Federation (GCMMF), which owns the Amul brand, the price of 400 gm pouch of curd will increase from Rs 30 to Rs 32 and for 1 kg pouch of curd from Rs 65 to Rs 69; 200 gm cup of curd will see a Rs 1 price increase and will cost from earlier Rs 20 to Rs 21 now; 400 gm cup of curd will now be priced Rs 42 as compared to the earlier Rs 40.
At the same time, the price of buttermilk (500 ml pouch) has been increased from Rs 15 to Rs 16 and the price of lassi (170 ml pouch) has gone up Rs 1 and will now cost Rs 11 from earlier Rs 10. The price of 200 ml cup of lassi, 85 gm cup of plain curd, 85 gm of Mishti doi remain unchanged. Other dairies are also expected to increase the prices of these items.
The effective impact of the likely GST levy will be 2-3% on the financials of dairy companies, a note by ICICI securities released earlier had noted. “We model most dairy companies to pass on the impact via price hikes,” it had said.
Curd and lassi account for 15-25% of the revenues of dairy companies under our coverage, according to the brokerage firm, which remained positive on the sector’s growth prospects despite the tax changes.