In a remarkable turnaround story, this Indian coffee chain has transformed its financial landscape, slashing its massive debt burden from Rs. 7,000 crore to just Rs. 427 crore through strategic asset sales and operational restructuring. This article explores how new leadership navigated through crisis, following the tragic loss of its founder in 2019, to stabilise the once-struggling business empire.
Share Price Movement
The share price of Coffee Day Enterprises Limited hit the upper circuit 5 percent to Rs. 30.28 per share on Wednesday, an increase from its previous close of Rs. 28.84 per share. The market capitalisation now stands at approximately Rs. 639.67 crore as of January 08, 2025.
What’s Driving the Price?
Coffee Day Enterprises Limited has reported its financial position as of December 31, 2024, showing a significant reduction in debt. The company’s financial indebtedness stands at Rs. 427.06 crore, down from a peak of Rs. 7,214 crore in 2019.
Under Malavika Hegde’s leadership, Cafe Coffee Day (CCD) reduced its debt from Rs. 7,214 crore to Rs. 427 crore by selling non-core assets like Mindtree shares, raising over Rs. 3,200 crore, and closing unprofitable stores. At its peak in 2019, CCD had 1,752 outlets across 243 cities, but the company began shutting down stores following its founder V.G. Siddhartha’s tragic death and the mounting debt.
Financial Highlights
According to its recent filing, in the quarter ending September 2024, Coffee Day Enterprises’s consolidated revenue from operations has increased by 4.2 percent YOY from Rs. 258.40 crore in Q2 FY24 to Rs. 269.34 crore in Q2 FY25 and increased by 3.5 percent QoQ from Rs. 260.07 crore in Q4 FY24.
The company’s consolidated net loss has decreased by 96 percent YoY, from a loss of Rs. 109.15 crore in Q2 FY24 to a loss of Rs. 4.31 crore in Q2 FY25. As compared to the last quarter of 2025, the company’s net loss has decreased by 67 percent QoQ from a loss of Rs. 13.28 crore.
The company’s debt peaked at Rs. 7,214 Cr in March 2019 and has now been reduced to Rs. 427.06 Cr as of 31 December 2024 in short- and long-term liabilities, marking a significant reduction of approximately 94.08%. It is on a path to becoming debt-free and profitable in the future.
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Market Outlook
India’s coffee market is projected to grow steadily, with consumption rising by over 5% annually. Factors like 80% urbanisation in Tier I and II cities and a 15% increase in disposable incomes drive demand. Rural markets, housing 70% of India’s population, are gradually embracing coffee, aided by affordable sachets and innovative product launches.
Despite tea dominating over 80% of traditional preferences, coffee brands are leveraging the 25% surge in health-conscious consumers to promote antioxidant-rich and low-calorie options, signalling a robust growth trajectory.
Shareholding Pattern
As of the September 2024 shareholding pattern, Coffee Day Enterprises Limited is primarily held by the public at 90.77 percent, foreign institutional investors hold 1.03 percent, and the promoters with 8.21 percent.
About Company
Café Coffee Day (CCD), an influential Indian coffeehouse chain founded in 1996 and headquartered in Bengaluru, has shaped coffee culture with over 2,000 global outlets. Known for premium coffee and diverse food offerings, CCD’s growth stems from its vertically integrated model, ensuring quality and cost control.
Despite challenges, including the founder’s passing and financial struggles, CCD remains resilient under Malavika Krishna’s leadership, adopting sustainable practices and streamlining operations, thereby continuing to delight customers worldwide.
Written By Fazal Ul Vahab C H
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