Poha Manufacturing Plant vs Premix Unit: Cost and Profit

Key Takeaways

• Two very different businesses share the name poha manufacturing. A poha manufacturing plant that flakes paddy needs ₹25 lakh to ₹42 lakh. A poha premix unit that buys flakes and adds value needs ₹14 lakh to ₹24 lakh.
• The mill is a commodity business. Gross margin runs 8 to 15 percent and it lives or dies on paddy procurement and yield.
• The premix carries better margin, 15 to 30 percent gross, because you are selling convenience rather than a grain.
• The tax treatment splits the same way. Pre-packaged plain poha attracts 5 percent GST. A spiced poha premix is a food preparation and attracts 18 percent.
• Yield decides everything in milling. A one percentage point improvement in poha recovery from paddy is worth more than any machinery upgrade you will make in year one.