Costa Coffee to enter India

New Delhi, Oct 29 | Updated: Oct 30 2004, 05:30am hrs
British coffee chain Costa Coffee, part of the 1.8 billion UK-based leisure company Whitbread, has announced plans to start operations in the country.

The coffee chain will be launched in India by Devyani International, part of the Delhi-based RK Jaipuria group, which has signed a master franchise agreement with Costa Coffee for opening 300 outlets all over the country over the next six years with an investment of Rs 150 crore.

We envisage an investment of Rs 150 crore by 2010, during which we expect to achieve the target of opening 300 outlets in India, RKJ group chairman Ravi K Jaipuria told reporters here on Friday. Primarily known as Pepsis bottler with eight soft drinks plants, RK Jaipuria has, however, diversified into varied businesses, including ice creams, education, hotels and real estate.

The group plans to open 20 outlets in the first year of its operation in the north, with the first outlet to come up in the Delhi by March next year.

The British coffee major also plans to set up a roastery in India in the next 12-18 months at a cost of POUND3 million. The roastery will have a capacity of 20-30 tonne a week and will cater to India as well as other Asian market requirements, Costa Coffees franchise and commercial director Nick Williams said.

The soft drink business accounts for about 50% of the groups turnover which is estimated to be about Rs 1,200 crore. RKJ is also the largest franchise for US pizza chain Pizza Hut, with 35 restaurants in north and eastern India.

According to Mr Jaipuria, unlike Pizza Hut, they were expecting Costa Coffee to break even early within two years of its launch.

The British coffee chain currently operates more than 500 stores in Europe as well as trades across the Middle East, from Egypt to Dubai, and has recently entered China.