HYDERABAD: CCL Products (India) Ltd, formerly known as Continental Coffee, has chalked out a mid-term growth strategy involving domestic and overseas expansion.
Over the next two-three years, the company, which sells instant coffee, filter coffee and coffee premix, plans to increase its footprint across the country, which essentially will more than double its revenue from the domestic business. Besides, the company plans to ramp up exports of its processed coffee to 100 countries from the current 90 during the same period. As it gears up to foray into unexplored markets, CCL will also be strengthening its distribution network of about 600 distributors covering over 50,000 outlets. By the end of 2019, the number of outlets covered will be raised to 1 lakh.
As of now, CCL has a significant presence in the southern states including Andhra Pradesh, Telangana, Karnataka and Tamil Nadu, which accounts for almost 75 per cent of the total coffee consumption in the country.
“Currently, Indian business is contributing about 7 per cent of the revenues, which is targeted to be improved to about 15 per cent in the next two years. With additional capacity, niche products and further value additions, the company is expected to achieve a CAGR of 15-20 per cent,” said Challa Srishant, MD, CCL Products.
The world’s largest private-label instant coffee maker also said it will invest $20 million during the current fiscal to enhance capacities and infrastructure. “We will be investing $20 million this fiscal,” said Srishant, adding that the entire capex will be borne out of the company’s internal accruals.
Of this, $12 million is earmarked for its facility in Chittoor in Andhra Pradesh, while the remaining $8 million will be invested to enhance capacities at its plant in Vietnam.
Speaking to media here Tuesday, he said all the units were debt-free except for the new SEZ set up with an investment of Rs 350 crore, including the debt component of Rs 225 crore. “In the next three years, we will be debt free,” he added.
CCL has a combined state-of-the-art manufacturing capacity of 35,000 tonnes per annum located at Duggirala, Andhra Pradesh, Switzerland, Vietnam and recently commissioned a plant in Chittoor.