CCL to boost production with USD 20-mn investment in Chittoor, Vietnam

Hyderabad-based instant coffee manufacturer CCL Products is set to invest USD 20 million to enhance its manufacturing capacity of two factories located in Chittoor, Andhra Pradesh, and Vietnam.

by Aultrin Vijay | 23/08/2019

Printweek

Challa Srishant, managing director of CCL Products said, “We will invest USD 12 million for enhancing the current capacity of 5,000 PMT to 10,000 PMT on agglomeration and packaging unit at SEZ in Kuvvakolli plant in Andhra Pradesh, while USD 8 million will invest for Vietnam plant capacity enhancement from 10,000 PMT to 13,500 PMT.”

Currently, CCL has four manufacturing units at Duggirala in Guntur, SEZ in Chittoor (both in Andhra Pradesh), Daklak Province in Vietnam, and Neuchatel Canton in Switzerland. The total combined capacity of these plants is 35,000 TPA.

According to Srishant, CCL exports its processed coffee to more than 90 countries and aims to mark presence in more than 100 countries in the next 2-3 years. Over 90% of the company’s revenues come from exports.

CLL had also roped in actress Nithya Menen as its brand ambassador to create a positive brand image in the Indian market.

Challal Rajendra Prasad, executive chairman of the company, said, “We are starting with Southern markets of India (AP, Telangana, Karnataka and Tamil Nadu), as almost 75% of coffee consumption happens in this market.” Prasad added that CCL plans to expand pan India by 2021.

He said the company has targeted to improve its revenues from its Indian business from 7% to 15% in the next two years. “With additional capacity, niche products, and further value addition, the company is expected to achieve a CAGR of 15-20%,” Prasad informed.

He said CCL has a network of approximately 600 distributors and covers more than 50,000 outlets. “The target is to cover more than one lakh outlets by the year end,” Prasad added.

(CCL Products) Source: United News of India

  • USD 20 million – Investment for Chittoor (Andhra Pradesh) and Vietnam factories
  • USD 12 million – Invested in Kuvvakolli plant in Chittoor, Andhra Pradesh
  • USD 8 million – Investment in Vietnam plant
  • 5,000 PMT to 10,000 PMT – Expected capacity addition at Chittoor plant
  • 10,000 PMT to 13,5000 PMT – Expected capacity addition at Daklak Province in Vietnam plant
  • 35,000 TPA – Combined capacity of four plants
  • 15,000 TPA – Additional capacity for premixes and R and G
  • Rs 350 crore – Amount spent on SEZ in Chittoor
  • Rs 225 crore – Current debt CCL has
  • 90 – Countries where CCL exports its processed coffee
  • >100 – Countries aimed for exports in next 2-3 years
  • 90% – Revenues earned from exports
  • 75% – Overall coffee consumption in Southern markets of India (AP, Telangana, Karnataka and Tamil Nadu)
  • 7% – Revenue from Indian business
  • 15% – Expected revenue in next two years  
  • 20% – Expected CAGR to be achieved with additional capacity, niche products and further value additions
  • 600 – No. of distributors
  • 50,000 – No. of outlets covered by CCL
  • 1 lakh – No. of outlets to be covered by year end
  • Rs 2,000 cr – Value of domestic instant coffee market
  • 65% – Consumption in Southern markets
  • Rs 500 cr – Value of filter coffee segment
  • 95% – Consumption in Southern markets

 

Source: PrintWeek