Nepal-based Karmacharya Group is set to invest NPR150m ($1.74m) in a processing and packaging plant at Jagate, Kathmandu.
The new plant will start production within next two months. The company claims that the plant will be capable of processing up to 36,000 liters of milk in a day, with 3,000 liters of milk per hour.
Karmacharya Group co-director Bikram Karmacharya was quoted by myrepublica.com as saying that the company has plans to sell 20,000 liters of milk per day in Kathmandu Valley.
"For this, we will be buying milk from dairy farmers of Chitwan, Kavre and Sarlahi."
"Although there is fierce competition in Kathmandu, we are hopeful about capturing a good market share, as there is high demand for milk in the capital," Karmacharya added.
To meet the production goal, the company has imported an advanced equipment from Filtron Company of Pune, India.
Besides milk, the firm also produces yoghurt, ghee and other dairy products.
Karmacharya produces Nova brand of milk. Its Fishtail dairy plant processes 6,000 liters of milk per day.