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Costa Coffee's sees India to be among its top 5 markets in 5 years
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Saturday, 03 May, 2025, 12 : 00 PM [IST]
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Our Bureau, Bengaluru
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“India will be among the top-five global markets for Costa Coffee, which is adding about 50 stores a year in the country as part of its expansion plans,” said the British coffee chain brand's Global CEO Philippe Schaillee.
The brand, now owned by beverages major Coca Cola, is enthusiastic about the Indian market where millennials are gradually shifting towards coffee from tea
"Today there are less than 50 million consumers who are willing to pay a premium for coffee. However, that cohort is growing massively in double digits. That's why India is an important market for us," Schaillee said.
The country is among the top-20 coffee markets globally for Costa Coffee. It is focussing on key metro cities as part of its growth strategy. "We want to play a long game here. So, we are focused on quality growth and not quantity growth. So, we have a run rate of opening about 40-50 stores a year. That's a good run rate," he said.
It is operated in India through its franchise partner Devyani International Ltd (DIL), is marking 20 years of presence in India. It is operating over 200 stores in India, which is among its top-20 markets.
"I think if we can maintain the current run rates, which we will definitely maintain, within five years, India can be among our top-five markets," Schaillee said.
The UK is the largest market for Costa Coffee, followed by China, the Middle East, and eastern Europe. It is focusing segments where consumers are interested and willing to pay a premium for specialty coffee. "We're increasingly entering highway petrol stations, together with DIL but we are also selectively opening flagship stores in the High Street and in shopping malls," he said.
In the Indian cafe market, it competes with international chains such as Starbucks, Tim Horton, McCafe, Dunking. Besides, local chains such as Cafe Coffee Day, Blue Tokai, Third Wave Coffee, and Barista are also amplifying their play in the segment in the country.
On growing competition in the domestic cafe market, Schaillee said, "We invite competition into the category. We have seen across the world that in tea drinking countries, emergence of specialty coffee players accelerates growth in the segment."
According to the latest annual report from DIL, in FY24, revenue from operations from Costa Coffee business stood at Rs 151.8 crore as against Rs 101.8 crore in the previous year, registering a growth of 49 per cent, driven by store expansion.
Average daily sales (ADS) stood at Rs 33,000 per store as compared to Rs 35,000 in the previous year. DIL is promoted by RJ Corp Ltd, which is also a promoter of Varun Beverages Ltd -- the bottling partner of PepsiCo as reported by the media house.
India is the second market after the UK to roll out Costa Coffee's new store design, with vibrant interiors, flexible seating, and enhanced digital experiences for a more modern, customer-centric environment.
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