Viswadatta Dairy Products has also decided to enter into a technology and marketing tie up with two Italian companies for manufacture of various types of cheese, Raja G Nori, one of the main NRI promoters of the company, told The Financial Express.

Refusing to divulge the names of the Italian companies pending the signing of the agreements, Nori said the new dairy would concentrate on producing value-added products such as various types of cheese (Cheddar, Mozzarella, Ricotta, Parmesa, Cream, Gouda, Cottage and Processed), fruit yogurts, butter, ghee, whey and protein concentrates.

The state-of-the-art plant is coming up in Kovvur in Rajahmundry district and would export 50 per cent of its production.

Although the margins in the domesticmarket are better, exports to the US are necessary to service the loan which is being provided by the US Exim Bank, Nori said.

The company would also look at the possibility of tapping markets in Canada and South America, he said.

Viswadatta Dairy would be built as per US FDA standards and its products would also conform to US FDA standards, Nori said. This would enable the company to easily access the US and other Western markets, he said.The cheese made by Viswadatta Dairy would be fully from buffalo milk as it contains low cholesterol and low fat content.

On the marketing front, Nori said, the company would sell all its products under its brand name. It has already applied for brand registration, he disclosed. It has already entered into agreement with milk Cooperatives for the supply of 2.50 lakh litres of milk everyday.

During the first year of operation, the company hopes to achieve a turnover of Rs 100 crore. It hopes to achieve a profit after tax of Rs 15 crore in the first year itself, Norisaid.

Nori said he plans to diversify into food processing and vegetables at a later date. The equipment available for the dairy plant could be used for the food processing ventures in lean seasons, he said.