Londile Moyo
Tapiwanashe Mangwiro
DAIRIBORD Holdings accelerated its capital investment drive in 2025, committing US$11,83 million to expand capacity, improve operational efficiency and reduce long term costs, signalling renewed confidence in Zimbabwe’s recovering dairy and beverages market.
The group’s latest financial results reflected a clear shift towards production led growth.
“A deliberate and strategically targeted program to expand productive capacity across key product lines was undertaken. Plant and machinery received and fully commissioned in 2025 amounted to US$10,71 million with prepayments for plant and machinery not yet received at year’s end amounting to US$1,12 million,” the company said.
Anchoring the investment programme was a US$4,2 million Steri milk plant, commissioned in December 2025, which management said would significantly enhance processing capacity while extending product shelf life.
The company described the project as a strategic response to evolving consumer preferences; favouring long life dairy products, particularly in a market still constrained by cold chain infrastructure limitations.
In addition, Dairibord invested US$2,9 million in a new Cascade beverages bottling line, also commissioned in December, to strengthen its position in the fast growing non dairy segment. The beverages division has increasingly emerged as a key growth pillar, offering diversification away from volatility in raw milk supply.
A further US$0,51 million was allocated towards refurbishing the Pfuko Maheu line, underscoring the group’s focus on rejuvenating traditional product categories that have continued to enjoy strong domestic demand.
Supporting the core manufacturing upgrades was the commissioning of a one megawatt solar power plant in Chipinge in October 2025.
The solar installation was intended to reduce dependence on the national grid, lower energy costs and cushion the business from electricity supply disruptions, which have long been cited as a major constraint to industrial productivity in Zimbabwe.
The capital expenditure programme was largely funded through borrowings, which rose sharply during the period. Short term loans increased to US$3,67 million from US$1,45 million in the prior year, while long term borrowings climbed to US$7,96 million, up from US$4,16 million.
“The loans, secured against company assets including plant, machinery and receivables valued at US$9,2 million, carried interest rates ranging between 45 percent and 47 percent for Zimbabwe dollar facilities and between 8 percent and 12 percent for US dollar denominated debt,” the company added.
Investment analyst Mr Daniel Mazhambe said the scale and focus of the capital programme signalled that Dairibord was positioning itself for sustained recovery.
“This was a business investing ahead of the curve. The emphasis on processing capacity, product diversification and energy self sufficiency spoke to a long term strategy rather than short term survival. Importantly, these investments came at a time when demand fundamentals were gradually improving,” Mr Mazhambe said. However, he cautioned that the cost of capital remained a structural constraint.
“Interest rates, particularly on local currency facilities, were still punitive. If that persisted, it risked slowing the pace at which companies could modernise and expand. The danger was that the industry might struggle to fully capitalise on the recovery momentum.”
Another analyst, Ms Nomsa Makufa, echoed the optimism, noting that the investment programme was consistent with a broader rebound in Zimbabwe’s manufacturing sector.
“We were seeing production volumes in several sub sectors inch closer to pre 2000 levels, and Dairibord’s capex programme was consistent with that trend. The company was effectively rebuilding capacity that had been eroded over the years,” she said.
Ms Makufa added that the solar investment was particularly significant given prevailing operating conditions.
“Energy reliability was critical for food processing businesses. Through investing in solar, Dairibord was not only reducing costs but also insulating itself from supply shocks, which could be very disruptive.”
She nevertheless warned that tight financing conditions could temper the pace of recovery.
“High borrowing costs remained a major constraint. If funding had become more affordable, we could have seen a much faster recovery across the industry. Without that, progress would likely have remained gradual.”
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