Costa Coffee, the British coffee chain, saw a 49% increase in operational revenue in India, reaching INR 151.8 crore, according to Devyani International Ltd‘s annual report. Additionally, its gross profit rose to INR 116.6 crore, marking a 45% growth compared to the previous year.
Devyani International Ltd (DIL) holds the master franchise for Costa Coffee, a brand owned by the global beverage giant Coca-Cola.
In 2023-24, the company added 67 new stores in India, bringing its total to 179.
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Financial Growth Metrics:
“In FY24, revenue from operations reached INR 151.8 crore, up from INR 101.8 crore the previous year, marking a 49% growth driven by store expansion. Gross profit increased to INR 116.6 crore from INR 80.4 crore the previous year,” the report stated.
However, the average daily sales per store declined to INR 32,710 in FY24, compared to INR 35,085 the previous year.
Future Outlook and Strategy:
The company stated that it expects performance to improve as the new stores stabilize and reach maturity.
DIL is rapidly expanding the Costa Coffee network in India, fueled by the growing young population.
“Moving forward, our focus is on adding 60-70 new units annually,” it stated, further adding, “As we persist in building the brand and capitalizing on business opportunities, we are confident in shaping a stronger future.”
According to DIL, India’s coffee culture is flourishing more than ever before.
“We are accelerating the expansion of Costa to cater to a larger consumer base, having incorporated 67 net new units in FY24, the highest in any year. With this growth, we have more than tripled our store count over the last two years, increasing from 55 stores to 179,” it stated.
DIL is extending Costa Coffee’s reach into high-traffic areas, including airports.
“With the domestic travel market flourishing, airports are bustling with activity, making them ideal spots for our premium coffee. Our presence at these locations perfectly matches the high demand and premium experience that travelers seek,” it stated.
Costa Coffee competes with Starbucks in the rapidly expanding Indian market. Starbucks operates through a 50:50 joint venture with Tata Consumer Products, while Barista also competes in this space.
“Our strategy involves exploring new channels and experimenting with various venues. The objective is to discern what resonates with consumers, understand their demands, and integrate successful approaches into our standard business operations,” it explained.
DIL also manages Quick Service Restaurant (QSR) chains such as KFC and Pizza Hut in India, along with the home-grown QSR chain Vaango.
DIL is promoted by RJ Corp Ltd, which also promotes Varun Beverages Ltd (VBL), PepsiCo’s bottling partner.
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