25 per cent growth then expected for milk producer in three following years.
According to the latest report from VinaCapital's Vietnam Opportunities Fund (VOF), International Dairy Products (IDP) recorded revenue growth of 60 per cent in 2014 compared to 2013, the highest in the dairy industry, thanks to the successful launch of the KUN brand for kids in the second half of the year. Losses, however, increased $1.7 million.
VOF management expect IDP to continue growing rapidly in 2015, at 50 per cent or more, and over the next three years anticipates average growth of 25 per cent or more per annum.
At the end of 2014 VOF, along with Daiwa PI Partners, announced the spending of $45 million to purchase a 70 per cent stake in IDP, which is widely known for its Ba Vi Milk.
VOF said in its report that Vietnam's milk market has great potential. Annual average milk consumption stands at 14 liters per annum, which is far lower than the regional average of 30 liters per annum and substantially lower than in countries such as Japan, India and Australia, who average 71, 83 and 106 liters, respectively. With a population of 90 million people and rising per capita GDP, Vietnam is expected to see dairy consumption grow strongly in the years to come.
As at January its investment in IDP stands as VOF's fifth largest, accounting for 4.8 per cent of net asset value, or approximately $35.46 million.
IDP was established in 2004 with its first factory just outside of Hanoi. It later launched two factories in Hanoi's Ba Vi district and Ho Chi Minh City's Cu Chi district, the two largest fresh milk production areas in the country. It is currently managing a co-operative of over 2,000 farmers, collecting more than 75 tonnes of fresh milk a day for brands such as Love'in Farm, Ba Vi, and Love'in Farm KUN.
On January 22 IPD and the Kerry Group, the world's leading corporation in the research and development of nutritional solutions, signed a strategic cooperation agreement to develop nutritional formulas of international standard.