Coffee in India

PROSPECTS

Low tax rates help boost coffee category

With fmcg companies passing the GST benefits on to consumers, coffee is expected to become more affordable for the masses. Coffee consumption is expected to increase in tier III cities and rural India as more people adopt coffee, leading to a rise in the per capita coffee consumption in India.

Coffee demand to be driven by growth in gourmet and fresh ground coffee

Demand for coffee is driven by millennials in urban centres, who look to experience different types of flavours. India witnessed growth in demand for gourmet and fresh ground coffee during 2016-2017.

Indulgence flavours help attract millennials

Companies are also introducing indulgence coffee flavours, such as rum-, tequila- and whisky- flavoured coffee to attract millennials. Companies such as Sussegado Coffee, Hetal’s Homemade and Nutrus have introduced such indulgence coffee flavours.

COMPETITIVE LANDSCAPE

Entry of new players with pan-India distribution channel

Nestlé and Hindustan Unilever dominate coffee sales in India; however, with the entry of Tata Global Beverages and ITC the competitive landscape might change. Both TGB and ITC have extensive distribution networks across India and capital with which to push their products.

Entry of new players to increase competitiveness in the industry

Nestlé and Hindustan Unilever dominate coffee sales in India. However, with the entry of Tata Global Beverages (TGB) and ITC the competitive landscape of coffee in India might change.

Start-ups to gain traction over next two years

Over 15 coffee start-ups were providing fresh ground gourmet coffee in India in 2018. Coffee manufacturing start-ups in India are launching new products with unique flavours to gain volume share.

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