FMCG stock in which HDFC Small Cap Fund has consistently increased its stake over the last 3 Qtr

Synopsis: Dodla Dairy has attracted the interest of investors, as HDFC Small Cap Fund has steadily enhanced its holding in the company from 3.7% in September to 6.2% as of December 2025. The growing confidence of institutional investors in the company, owing to better execution and growing penetration in urban areas, makes it an important FMCG player

This small-cap FMCG company has also gained prominence in recent times as the HDFC Small Cap Fund has been steadily accumulating stakes in the company over the past three quarters. The acquisition of stakes in the FMGC company by a major domestic fund, together with the rising market presence of the company, especially in terms of business execution, has ensured the company remains one of the major consumption stories.

This company is one of India’s leading integrated dairy companies, which procures, processes, and sells milk & milk products, including buttermilk, ghee, curd, paneer, flavoured milk, doodh peda, lassi, ice cream, and milk-based sweets under brands including Dodla, Dodla Dairy, and KC+ in India.

With the market cap of Rs 7,330 crore, the shares of Dodla Dairy Ltd have closed at Rs 1,215. The shares are trading at a PE of 28.2, whereas their industry PE is at 27.1. The shares have given a return of 110% since their listing in July 2021. 

Increasing Stake Signals Increasing Conviction

It is observed that the increase in holding by the HDFC small-cap fund has been steady in the case of Dodla Dairy, as the stake is at 6.2% as of December 2025, as opposed to 3.7% in September 2025 and even lower levels before that. There seems to be no random act but progressive confidence in the fundamentals of the company.

The quarterly additions in June 2025, September 2025, and December 2025 suggest a strategy of gradual accumulation, which is common with long-term strategic investors who want to accumulate without rocking the markets. This can be an indicator of better understanding or insights being gained regarding earnings or margins.

From the portfolio management theory viewpoint, the holding value of Rs 459.6 crores and the number of 3.75 million shares emphasize Dodla Dairy’s rising significance in the portfolio of an investor. The addition of just 2.5% in December 2025 itself symbolizes that in late-stage investments, confidence is retained even after an initial round of buying.

What It Means for the Stock

This trend of rising ownership would suggest that Dodla Dairy is increasingly being viewed as a structural consumption play rather than a short-term trade. Operating leverage, owing to strong regional brands and procurement networks, tends to kick in as volumes scale for such dairy businesses.

Also, more quarters of consistent stake building would reduce the element of speculative intent and point to expectations of longer-term value creation. Stock performance will again depend on execution and sector dynamics, but the data does indicate a definitive positive turn in investor sentiment, and Dodla Dairy becomes a stock that markets will most likely keep a closer watch on in the days to come.

Financial highlights and more

The revenue from operations for the company stood at Rs 1,019 crores in Q2 FY26 compared to Q2 FY25 revenue of Rs 998 crores, up by about 2 percent YoY. Similarly, the net profit stood at Rs 66 crore in Q2 FY26, up compared to the Rs 63 crore profit in Q2 FY25.

The second quarter of FY26 saw the sales base of the company heavily dominated by milk sales, contributing 70% of the total sales. The sales of curd proved to be another major contributor at 20%, while other VAPs were at 7%, suggesting a gradual buildup of the more profitable offerings. Bulk sales were negligible at 3%, keeping the risk of exposure to the lower-margin segment restricted.

Dodla Dairy’s presence stretching into the realms of e-commerce, quick commerce, and organised trade through Flipkart, Zomato, Zepto, Blinkit, Swiggy Instamart, and others like DMart, Reliance Retail, Metro, Ratnadeep, Lulu, Value Zone, Today’s Basket, and Q-Mart reveals the company’s concentrated efforts to establish itself in the urban markets.

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.

The post FMCG stock in which HDFC Small Cap Fund has consistently increased its stake over the last 3 Qtr appeared first on Trade Brains.