Continental Coffee hits domestic market.

After focusing on global market for 25 years, CCL Products (Continental Coffee) has set it eyes on the Rs. 2,500-crore domestic coffee retail market, as it announced a Rs. 140 crore capacity expansion plan.

With a production capacity of 35,000 tonnes, CCL Products is the world’s largest private label instant coffee manufacturer, exporting its products to over 100 countries, supporting over 250 brands. Besides, it can process another 15,000 tonnes of premixes, roast and ground coffee.

Now, the company is looking at the promising domestic market, dominated by the instant coffee products (Rs. 2,000 crore) and filter coffee with a size of Rs. 500 crore.

It is kicking off a marketing campaign in the South, which dominates the domestic market with a 75 per cent share, on August 15. It roped in South Indian film actress Nithya Menon as its brand ambassador. It plans to go pan India by 2021.

Expansion

The firm has also announced a Rs. 140 crore ($20 million) expansion plan to expand the capacity of its Vietnam plant and at Chittoor. “We are going to expand the Vietnam facility with Rs. 56 crore ($8 million) and Chittoor plant with Rs. 84 crore ($12 million),” Challa Srishant, Managing Director of CCL Products, has said.

Addressing a press conference here on Tuesday, he said the company would meet the expenditure through internal accruals.

The domestic business is contributing a small percentage (7 per cent) of its Rs 1,100 crore turnover. “We are targeting to increase this to 15 per cent in the next two years,” Srishant said.

With additional products, capacity and new market, the firm hopes to achieve a growth rate of 15-20 per cent in revenues this financial year.

The later plant would also have packaging facilities. Post expansion, the capacity of Vietnam facility would go up to 13,500 tonnes from 10,000 tonnes.

It has plants at Duggirala (Andhra Pradesh), Kuvvakolli (Andhra Pradesh), Vietnam and Switzerland.

HBL