Hyderabad: World’s largest private label instant coffee manufacturer, CCL Products (India), is going to invest $20 million (about Rs 140 crore) this fiscal through internal accruals to enhance manufacturing capacity and infrastructure. Out of this investment, $12 million will be spent on an agglomeration and packaging unit at Chittoor in Andhra Pradesh and $8 million in Vietnam plant for capacity expansion.
The Rs 1,100 crore turnover Hyderabad-based company, has units at Duggirala in Guntur District of AP, SEZ near Sullurpet in Chittoor District of AP, Daklak Province in Vietnam and Neuchatel Canton in Switzerland. All the units are debt-free except for the new SEZ for which about Rs 350 crores was spent and the debt on account of this is in about Rs 225 crores.
The company has a total instant coffee manufacturing capacity of 35,000 tonnes per annum (TPA), which comprises of 24,000 TPA spray dried/ granulated coffee and 11,000 TPA of premium variety freeze dried coffee. In addition, more than 15,000 TPA of coffee related products such as premixes, R&G etc. can also be processed.
The company said, worldwide, CCL’s coffee is being consumed at the rate of 1,000 cups per second. CCL exports its processed coffee to more than 90 countries supporting over 250 brands. The company plans to cater to over 100 export markets in the next 2-3 years.
CCL offers 1,000 blends/recipes for its clients to choose. It offers the entire basket of coffee products -spray dried, granulated, freeze dried, liquid coffee, blended coffee products like chicory coffee, roast & ground coffee, premixes etc, covering every aspect of processed coffees.
Having established its presence in the global markets, the company is now rolling out new range of Continental Coffee in Indian market. The company has products in three categories- Instant Coffee, Filter Coffee and Coffee Premix. As a part of its India market growth strategy, the company has roped in Actress Nitya Menon as its Brand Ambassador.
In the Instant Coffee space, the company has Continental Speciale, which is a 100 per cent pure coffee and Continental Xtra, which is a coffee chicory mix targeted towards South Indian taste palette. Subsequently Continental Black Edition was launched which is essentially freeze dried coffee, targeted to upgrade people with a more aromatic and flavorful coffee. Filter Coffee range consists of its brand Continental Malgudi, which comes with two coffee chicory blends of 80:20 and 60:40. The Coffee Premix is targeted to cater to millennials making it convenient to prepare with ease.
Challa Rajendra Prasad, executive chairman, CCL Products, said, “The instant coffee market in India is approximately around Rs 2,000 crores, growing at a CAGR of 7 to 10 per cent for the last three years. Filter coffee market in India is currently valued at Rs 500 crore out of which south accounts for 90 per cent. CCL sees growth opportunities in these markets. Premix coffee segment is still in nascent stage.”
Pan-India roll out
“Starting with Southern markets of India, as almost 75 per cent of coffee consumption happens in this market, CCL has plans to expand to pan-India by 2021. Currently India business is contributing around 7 per cent of the revenues, which is targeted to be improved to around 15 per cent in the next two years. With additional capacity, niche products and further value addition, we are expecting to achieve a CAGR of 15-20 per cent,” said Challa Srishant, MD, CCL Products.
CCL has a network of about 600 distributors (about 100 in Telangana alone) and covers more than 50,000 outlets directly. By the year-end, the target is to cover one lakh outlets. The company employs about 1,000 in India and about 250 abroad.