Will double roasting business, says Coffee Day's Siddhartha

Will double roasting business, says Coffee Day's Siddhartha
Cashing in on the burgeoning coffee lovers in India, Coffee Day Enterprises, the parent company of the Coffee Day Group, is planning to double the capacity of coffee roasting business in Chikkamagaluru, a top executive said on Monday.

Talking to Deccan Herald, Cafe Coffee Day Chairman V G Siddhartha said, “We manufacture around 6,000 machines every year in Bengaluru. We have tied up with 180-year old German firm WMF last month. We will manufacture jointly in Chikkamagaluru and supply to Asia and South-east Asia.”

Siddhartha added, “As of now, we have a manufacturing base in Bengaluru, which we will be shifting to Chikkamagaluru. More than machinery for me, along with that I can supply my coffee, tea, cups, etc., even as I keep the maintenance contract of the machine. Majority consumers will be corporates. With the WMF tie-up, we can hit the five-star hotels too.”

He added, “We are doubling the capacity of our coffee roasting business in Chikkamagaluru. We are investing Rs 42 crore in expansion of the roasting facility. Next to that facility this will come. It is part of the roasting expansion plans. In the next eight to twelve months, it should happen.”

When asked about sourcing, Siddhartha said, “On an average, we source around 23,000 to 25,000 tonnes. We are purposely not increasing because we take good coffee for our own use, and export the remaining. We want 7,000 to 8,000 tonnes for internal consumption. In the next five to seven years our consumption will be 15,000 tonnes. We control 23,000 to 25,000 tonnes of the commodity for future consumption. So the next five to seven years should not be a problem for us. We have good network of sourcing. We operate with our 30 agents, around 250 km of growing area. We are very comfortable in sourcing.”

Coffee Day is proposing to open on October 14, 2015, a public issue of equity shares of face value of Rs 10 each for cash, including a share premium, aggregating up to Rs 1,150 crore. The price band has been fixed between Rs 316 to Rs 328 per equity share.

“We have plans to put 135 CCD outlets in the next two years. It requires around Rs 37 lakh to Rs 40 lakh. It will be Co-Co models (company owned and company operated). The biggest market for us is Delhi-NCR region with 240 stores,” Siddhartha said.

Liked the story?

  • 0

    Happy
  • 0

    Amused
  • 0

    Sad
  • 0

    Frustrated
  • 0

    Angry