CCD to invest Rs 450 crore to open 400 outlets in next 3 years
Chairman V G Siddhartha added 70 per cent of the new stores would come in exciting cities where CCD already operates and rest would come up in new cities and highways.
PTI New Delhi Last Updated: September 27, 2015 | 11:50 IST
Girls sit at the window of a Cafe Coffee Day outlet in Mumbai, February 25, 2015. (Photo: Reuters)
Cafe Coffee Day will invest up to Rs 450 crore over the next three years to open 400 outlets in the country while it completes all formalities to come out with its Rs 1,150-crore initial public offering in October.
"We are in the process of getting final approvals to come out with our IPO before Dussehra (October 22). Over the next three years we plan to open 135 outlets every year and will invest Rs 400-450 crore. All our stores are company owned," Cafe Coffee Day (CCD) Chairman V G Siddhartha told PTI.
He added 70 per cent of the new stores would come in exciting cities where CCD already operates and rest would come up in new cities and highways.
"We see a lot of opportunity in opening more outlets on highways. At present we operate 137 highway stores," he said.
Elaborating on the IPO, he said: "We will use funds raised to fund expansion of our coffee business and to retire debt."
Last month, Coffee Day Enterprises, which runs the country's biggest coffee chain, received markets regulator Sebi's go ahead to raise funds through IPO.
It plans to list its shares on BSE (Bombay Stock Exchange) and the NSE (National Stock Exchange).
The company, which counts private equity giants like KKR, Stanchart PE and New Silk Route among its investors, has reserved Rs 15 crore worth shares for staff.
Coffee Day Enterprises is the parent company of the Coffee Day Group and operates coffee business through a subsidiary, Coffee Day Global (earlier known as Amalgamated Bean Coffee Trading Company) and its subsidiaries.
The company's non-coffee business includes its investment in IT firm Mindtree where it holds over 16 per cent stake, subsidiary Sical Logistics and technology park subsidiary Tanglin Development.
Out of the capital raised through the issue, the parent company plans to utilise nearly Rs 625 crore to pay off debt and the remaining to open new stores, set up coffee bean roasting plants and make vending machines.
At present, the company runs over 1,500 outlets across 220 cities.