Costa Coffee and Devyani keep India expansion plans, but slow the pace
Costa and Devyani still want India growth, but the playbook has shifted from 40-50 stores a year to a more selective push built around better sites and tighter margins.
Costa Coffee and Devyani International are still pressing ahead in India, but the expansion story has changed from a hunt for store count to a more careful search for the right store. The brand had once aimed to make India one of its five biggest markets globally by 2030, with Philippe Schaillee calling for about 40-50 openings a year. Now the pace looks more tactical, shaped by a market that still offers room to grow but no longer rewards blunt-force expansion.
That reset matters because Costa has been in India since 2005, when Devyani brought the chain in. The brand marked 20 years in the country in 2025, and the latest numbers still point to momentum, just not the kind that invites a sprint. Costa Coffee India revenue from operations rose 30.76% to Rs 198.5 crore in FY25, while net profit climbed 28.4% to Rs 149.7 crore. Outlet count moved from 179 in FY24 to 220 in FY25, with Devyani adding 41 Costa Coffee stores during the year.
The pressure is in the economics behind those openings. Costa Coffee India’s gross margin slipped to 75.4% in FY25 from 76.8% a year earlier, a reminder that beans, freight and other inputs are still biting into returns. That is the real brake on rollout. India’s branded coffee market is large and aspirational, but it is also price-sensitive, crowded and increasingly shaped by domestic specialty chains as well as global names. A store can look good on paper and still underperform if the site is wrong, the rent is too heavy, or the consumer is not ready to pay for a premium cup every day.
So Costa is leaning harder into formats that can carry the math. The brand has focused on petrol stations, shopping centres, airports and office campuses, locations where footfall is strong and customers are more likely to accept a higher ticket. That is a different expansion game from simply piling up outlets in metro cities. It also shows why the next phase of chain coffee in India will be about discipline, not just ambition. Tata Starbucks has set its own target of 1,000 stores by 2028, while Barista is aiming for 800-900 outlets by 2030 with a push into tier-II and tier-III towns.
Costa still wants meaningful share in India. The shift is that growth now has to be earned store by store, in a market where the easy openings are gone and the winners will be the chains that match the right site with the right price and the right format.
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