As India’s dairy market grows, brands are looking beyond volume to create value through protein, premiumisation, functional nutrition and new consumption formats.
For dairy brands, the next phase of growth is taking shape in the products they are building around their core portfolios. Protein-rich formats, Greek and flavoured yoghurt, lactose-free milk, premium cheese and functional dairy are opening up new opportunities to serve consumers with more specific needs and preferences. What was once a category largely defined by everyday staples is now seeing brands compete through product differentiation, premium offerings and new consumption occasions.
According to Mordor Intelligence, India’s dairy market expanded from $31.07 billion in 2025 to $31.95 billion in 2026 and is projected to reach $44.48 billion by 2031, registering a CAGR of 6.84% between 2026 and 2031. Rising disposable incomes, the expansion of organised retail and wider cold-chain coverage are supporting this transition towards value-added products and higher-value segments.
The shift is visible across both established dairy companies and newer, premium-focused players. Amul, Mother Dairy, Heritage Foods, Parag Milk Foods, Milky Mist, Hatsun Agro Product, Nandini, Godrej Jersey and Akshayakalpa Organic are extending their portfolios beyond traditional staples, while specialised players such as smöoy India are creating new consumption occasions around frozen yoghurt.
What Are Dairy Brands Bringing?
Protein has become a prominent innovation territory in dairy over the past two to three years. Amul has expanded its high-protein portfolio across milk, paneer, buttermilk, lassi and milkshakes, while Mother Dairy has entered the segment with its Pro range. Heritage Foods has also strengthened its value-added portfolio with high-protein paneer and specialised yoghurt offerings. Together, these launches reflect how brands are positioning dairy not only as an everyday source of nourishment, but also as a product addressing more specific interests in fitness, satiety and functional nutrition.
Premiumisation, meanwhile, is creating opportunities beyond protein-led innovation. Parag Milk Foods continues to develop Pride of Cows through premium milk, Greek yoghurt and high-protein products. Akshayakalpa Organic has expanded from organic milk into A2 dairy, Greek yoghurt, cheese and high-protein offerings. Godrej Jersey has built its value-added portfolio across yoghurt, flavoured milk, paneer, lassi, buttermilk and ice cream. Meanwhile, smöoy India is bringing frozen yoghurt into the mix, adding a more experiential and indulgent format to dairy consumption.
Beyond Basic Dairy
The shift from traditional dairy staples to value-added products is becoming increasingly visible across the category, as brands create new consumption occasions around familiar products such as curd, paneer, and milk. For Godrej Jersey, the opportunity is not necessarily to replace these staples, but to make them more relevant to changing consumer needs through affordability, convenience, nutrition and variety.
Godrej Jersey’s focus is on moving products such as curd and paneer from largely unorganised consumption into more organised channels. Gaurav Pande, CEO, Creamline Dairy Products Ltd. (Godrej Group), explains that Curd consumption is already deeply embedded in Indian food habits. The job is to convert the great latent demand from unorganised to organised channels.
Paneer, meanwhile, presents an opportunity to increase both household penetration and consumption frequency. The company is therefore placing greater emphasis on consumer education alongside product innovation. Its ₹99 High-Protein Paneer, offering 30 grams of protein per pack, is positioned to make protein-rich paneer accessible to a wider set of households. Godrej Jersey has also partnered with food content creators such as Chef Teja to demonstrate everyday ways of incorporating paneer into meals across South India.
“In the case of Paneer, there is an opportunity to drive penetration of in-home consumption of Paneer as well as increase frequency of consumption by making it more central to the plate.” This makes education an important part of the brand’s approach, with content creators helping consumers explore new ways of using the product,” he adds further.
Flavoured milk is another area where the company sees room for growth. The category is among the fastest-growing segments of its business, with a protein-fortified range currently in development. “A protein-led product proposition, and not just flavours, is expected to be a major driver of growth for this category in the future,” notes Pande, signalling a broader move towards nutrition-led innovation within established dairy formats.
Building Value-Added Growth
Heritage Foods is taking a broader approach to the same category shift, increasing its focus on value-added products as consumers seek greater quality, convenience and variety from products that are already part of their diets.
Srideep Kesavan, CEO, Heritage Foods, explains that historically, the dairy sector was largely viewed as a commodity business, with liquid milk accounting for a significant share of industry volumes. But the category is changing and the brand is seeing a clear opportunity to build a stronger portfolio around consumers’ evolving needs.
Heritage Food’s value-added products (VAP) portfolio now contributes around 45% of revenue, with the segment growing faster than its traditional business. Curd, paneer, buttermilk, lassi, ice creams and ghee are emerging as important growth drivers. The company has also reported strong growth across paneer, curd, buttermilk and lassi, reflecting the wider movement towards value-added dairy.
“These are not unfamiliar products. They are products that have always been part of Indian diets, but we are seeing consumers demand greater quality, convenience and variety within these categories,” says Kesavan.
The expansion is also being supported by investments in capacity, including ice cream and flavoured milk, as Heritage Foods builds out its wider VAP portfolio. At the same time, nutrition is becoming another layer of innovation. Products such as Heritage Nourish+ High-Protein Curd, which provides 25 grams of protein in a 400-gram pack, and A-One Probiotic Buttermilk are bringing protein and probiotic propositions into familiar dairy formats.
As Kesavan puts it, “The next phase of dairy growth will come from taking products consumers already trust and making them more nutritious, convenient and relevant to contemporary lifestyles.”
Health Meets Experience
As dairy brands move beyond everyday staples, health and wellness are becoming increasingly important to product development. Yet the shift is not as simple as removing sugar or adding a functional ingredient. For brands such as Akshayakalpa Organic and smöoy India, the challenge is to make healthier choices work within the realities of taste, convenience, packaging and the overall consumption experience.
Akshayakalpa Organic, an organic dairy brand, focuses on balancing health with taste, which remains one of the biggest challenges in developing products for a wider consumer base. Shashi Kumar, CEO & Founder, Akshayakalpa Organic, points out that sugar continues to play an important role in how consumers perceive taste, creating a natural limitation for brands attempting to build products with cleaner nutritional profiles. “Most of the taste in products today is derived from sugar. If you are saying that you don’t want to make any products with added sugar, you are actually eliminating a segment of customers because they need taste,” he says.
The brand’s approach to innovation also extends beyond the product itself. Packaging has become an important part of the sustainability conversation, particularly for a category such as milk where eliminating packaging is not currently practical.
“We can’t do plastic-free packaging yet. It still needs to be packaged. So, what changes can you bring to the consumer lifecycle?” asks Kumar. Akshayakalpa is addressing this through its “Give Back Your Milk Pack” campaign, under which milk packs purchased through its direct channel are collected from consumers for recycling. The company is also exploring alternatives to conventional plastic packaging.
Gable-top packaging, which uses paperboard with a PE coating, is one format Kumar identifies as having the potential to reduce plastic usage in milk packaging. “These are the kinds of innovations we need to look at because milk packaging generates a lot of plastic, and we need to do something about it,” he states.
Making Every Cup Different
While health and sustainability are influencing innovation in traditional dairy, newer formats are finding another route to repeat consumption: experience. In frozen yoghurt, brands are using flavours, toppings and customisation to turn a relatively simple product into an interactive consumption occasion.
smöoy India, a Spanish frozen yoghurt brand, believes that repeat consumption is therefore not dependent on the core product alone. Sangeeta Nagar, Director, smöoy India, says that product innovations provide consumers an incentive to come back, while toppings and flavours help to make every time a unique experience.
The physical retail environment becomes equally important in this model. From ease of selection and product discovery to the ability to experiment with combinations, the store experience can influence whether frozen yoghurt becomes an occasional purchase or a repeatable habit. “The retail experience is equally as important as the other elements in the equation,” Nagar says. For smöoy, factors such as how attractive the outlet is, how easily consumers can make a choice, opportunities to discover new combinations and the social nature of the experience all contribute to repeat consumption.
Familiar Formats, New Occasions
From frozen yoghurt and flavoured milk to high-protein products, paneer and packaged curd, brands are finding that innovation works best when it builds on familiarity while adding new reasons to consume. One of the key learnings for smöoy India has been that the consumers are open to experimentation when they have a familiar starting point. Nagar says Indian consumers are willing to experiment with known flavours and different preparations, particularly when they are given the opportunity to create something themselves.
The brand has applied this insight to its frozen yoghurt proposition, where popular flavours provide an entry point before consumers move towards newer combinations. “The process usually starts with a popular taste and then brings in customers searching for the new,” she adds.
Kumar asserts that Akshayakalpa Organic is looking at products that can create a renewed connection between adults and milk. “The category is evolving. The focus is: can we get an adult who has actually stopped drinking milk to start drinking milk again? The only way is protein.”
Kesavan describes the shift as one where consumers are adapting traditional dairy to changing lifestyles rather than abandoning it. He notes that the cheese of India is paneer, and the yoghurt of India is curd.
This balance between the familiar and the new is also shaping where brands see the biggest opportunities for mainstream growth. For Godrej Jersey, curd remains one of the largest opportunities within value-added dairy because of its established role in Indian diets and the continued shift from loose or homemade consumption towards organised packaged products.
Paneer is another category that Pande sees developing rapidly, particularly as protein awareness increases. “Paneer follows closely and may prove to be the more interesting category of the two. It is moving from an occasional cooking ingredient to a more frequent one, faster than most in this industry expected.”
The dairy aisle is no longer just about what goes into the morning cup of tea or the family meal. It is becoming a space where protein, indulgence, convenience and experimentation meet familiar Indian tastes. As brands continue to reinvent milk, curd, paneer, yoghurt and other formats, the next opportunity may lie in making dairy fit not just into changing diets, but into the many different ways consumers now eat, drink and live.
