Launched in Munger in Bihar, each of the 500 ml packs is priced at Rs 19 and will compete against products from Amul, Mother Dairy and Sudha, among others.

“We launched pouch milk under the Aashirvaad Svasti brand two weeks ago in Munger. We have a milk processing plant there,” according to Hemant Malik, divisional chief executive of the company’s foods business.

Asked if ITC would opt for a national roll-out of its pouch milk, Malik said, “It will never be national, but we will expand it.”

The company has set up a separate dedicated distribution channel for milk products. However, it did not share details.

The Rs 720 billion pouche milk segment mostly caters to the budget category. The company has consciously decided not to focus on the Rs 8 billion Tetra Pak segment.

“It is (Tetra Pak milk) very niche.

We are talking about a Rs 72,000 crore market,” Malik said, adding the price point and the 500 ml packet size would cater to local needs, since people mostly use milk to make tea and curd in Bihar.

Asked about the company’s plans to set up a cold chain, a prerequisite for dairy distribution, Malik said: “We procure the milk today, which is pasteurised and packed and is kept under 4 degrees. At 4’o clock in the morning, they go to different outlets. If some is left, the seller keeps it in his fridge. They don’t keep it for more than a day”.

The organised dairy market in the country is dominated by Amul, Nestle and Mother Dairy. But Mailk said the category had enough space for ITC and the market was likely to grow rapidly.