Published: 8 hours ago

Dairibord Holdings has intensified its investment drive, committing US$11,83 million in 2025 towards expanding production capacity, improving efficiency and reducing long-term operating costs, in what signals renewed confidence in Zimbabwe's recovering consumer goods sector.

The group said the bulk of the spending went into plant and machinery, with US$10,71 million commissioned during the year and a further US$1,12 million in prepayments for equipment yet to be delivered.

Central to the programme was a US$4,2 million Steri milk processing plant, commissioned in December 2025, which is expected to boost output and extend shelf life for dairy products amid persistent cold-chain constraints in Zimbabwe.

The company also commissioned a US$2,9 million Cascade beverages bottling line, strengthening its non-dairy segment as diversification becomes increasingly important in the face of milk supply volatility.

A further US$0,51 million was directed towards refurbishing the Pfuko maheu production line, reflecting continued investment in traditional beverages with strong domestic demand.

In a push to reduce energy costs and improve resilience, Dairibord also installed a 1MW solar power system at its Chipinge operations in October 2025, aimed at easing dependence on the national grid, which has faced reliability challenges.

The capital programme was largely funded through borrowings, with short-term loans rising to US$3,67 million and long-term debt increasing to US$7,96 million. The loans were secured against company assets valued at US$9,2 million and carried interest rates ranging from 8% to 47%, depending on the currency of denomination.

Analysts said the investment drive reflected a broader manufacturing recovery trend, with companies rebuilding capacity after years of constrained output.

Investment analyst Daniel Mazhambe said the strategy indicated long-term positioning rather than short-term survival, noting the focus on processing capacity, diversification and energy self-sufficiency.

Fellow analyst Nomsa Makufa said the solar project was particularly significant in improving operational stability, given the impact of power shortages on food processing industries.

However, both analysts cautioned that high borrowing costs remain a key constraint on industrial expansion, potentially slowing the pace of recovery despite improving demand conditions.

Dairibord's strategy positions it for potential growth in a gradually stabilising market, but its success will depend on converting new capacity into sustained volume growth and improved profitability.
- onlkine

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