Tata Coffee, a leading player in the coffee industry, has secured the board’s approval for a substantial investment of INR 450 crores to enhance the capacity of its wholly-owned subsidiary based in Vietnam. The company aims to meet the rising demand for freeze-dried products with this strategic move.
Tata Coffee Vietnam Company currently operates at a capacity of around 5,000 metric tonnes, with a utilization rate of approximately 96 percent. In response to the growing market demand, the board has sanctioned the establishment of an additional 5,500-tonne freeze-dried coffee facility in Vietnam, as disclosed in a regulatory filing by the company.
The proposed investment of USD 53.3 million (equivalent to approximately INR 450 crores) will be directed towards the creation of this new capacity, and the funds will be drawn from internal accruals and bank financing, according to Tata Coffee. This expansion initiative is expected to be implemented over the next two years.
Tata Coffee emphasized that the augmentation of capacity is strategically aligned with the increasing consumer preference for freeze-dried coffee products. By addressing this demand, the company aims to strengthen its position in the market and ensure a more efficient utilization of its production capabilities.
This significant investment underscores Tata Coffee’s commitment to innovation and growth, positioning the company to capitalize on emerging trends in the coffee industry.