CCL Products Q4 FY25: Strong Growth, Retail Surge

CCL Products (India) Limited, a global leader in private label coffee manufacturing, delivered a solid financial and operational performance in the fourth quarter and the entire fiscal year of FY25. The company reported robust year-on-year revenue and net profit growth, supported by rising demand across domestic and international markets. With its branded retail vertical gaining momentum and an aggressive push in new-age distribution channels like quick commerce, the company remains well-positioned for sustained growth.

This comprehensive report covers all aspects of CCL’s Q4 and FY25 performance, including detailed financial analysis, segmental performance, channel strategy, regional focus, capacity utilization, pricing dynamics, market outlook, risks, and strategic initiatives.

 Financial Performance

1.1 Quarterly Performance – Q4 FY25

In Q4 FY25, CCL Products reported revenue from operations of ₹836 crore, marking a 15% increase over ₹727 crore reported in Q4 FY24. This growth reflects a strong uptick in demand across both domestic and export verticals, aided by price increases and a favorable product mix. Net profit for the quarter stood at ₹102 crore, up significantly by 56.2% from ₹65 crore in the corresponding quarter last year. This profit growth was driven by higher operating leverage, improved margins, and optimized procurement strategies.

The company’s EBITDA stood at approximately ₹167 crore, while profit before tax (PBT) came in at ₹106 crore, indicating operational efficiency and resilience amidst a volatile raw material pricing environment.

1.2 Full-Year FY25 Financials

For the full year, CCL Products recorded revenue from operations of ₹3,106 crore, up 17% from ₹2,654 crore in FY24. Net profit for the year reached ₹310 crore, a rise of 24.1% from ₹250 crore in the previous year. EBITDA for FY25 was recorded at ₹564 crore, while PBT stood at ₹352 crore. These figures reflect CCL’s ability to scale its operations while maintaining strong profitability.

The healthy year-on-year growth in both revenue and profit demonstrates the success of the company’s dual strategy—expanding branded retail offerings in India and strengthening private label partnerships globally.

 Business Segment Performance

2.1 Domestic Business

The domestic segment has emerged as a significant revenue driver. In FY25, gross domestic revenue reached approximately ₹440 crore, of which ₹300 crore was contributed by the retail branded vertical. This growth indicates the rising popularity of CCL’s branded products in India, supported by increased consumer awareness, expanding café culture, and growing acceptance of coffee in traditionally tea-dominant regions.

The company’s efforts in penetrating retail channels and investing in brand equity have begun to yield results. CCL is also capitalizing on urban trends where coffee consumption is increasing rapidly, especially among millennials and Gen Z consumers.

Looking ahead, the company expects the domestic segment to maintain its current momentum. Key focus areas include deeper retail penetration, expansion into new cities, and improved product visibility through both offline and online platforms.

2.2 International Business

Though detailed breakdowns were limited in the earnings call, the international business remains a critical component of CCL’s operations. The company exports to over 90 countries and services several private-label clients globally. The completion of the expansion project at its Vietnamese subsidiary, Ngon Coffee Company Limited, further strengthens its international production capability.

Vietnam’s strategic location and cost-efficient operations make it an ideal hub for export-oriented growth. With the expanded facility now operational, CCL expects to ramp up international production to meet increasing demand from Europe, the U.S., and emerging markets in Asia.

Section 3: Operational and Margin Dynamics

3.1 Focus on EBITDA Growth

Maintaining and expanding EBITDA is a key strategic goal for CCL Products. The company embeds anticipated expenses into its margin planning, ensuring that profitability is not eroded by unforeseen costs. This proactive approach to margin management has helped the company sustain healthy operating margins even amidst rising input prices.

One of the contributing factors to higher EBITDA was the shift toward premium blends and increased focus on end-consumer preferences. This change in product mix, aligned with demand trends, helped the company extract more value per kilogram of coffee sold.

3.2 Working Capital and Debt

CCL reported that of the ₹1,800 crore capital employed, about ₹1,150 crore is tied up in working capital. This increase is attributed to the tight coffee market, where sellers are in a better position due to constrained global supply. In such a seller’s market, buyers tend to expedite payments to secure stock quickly, shortening payment cycles and increasing cash flow pressure for suppliers like CCL.

The remaining capital employed pertains to long-term loans and advances, much of which is directed toward capacity expansions. The company acknowledges that every six to seven years, its capital expenditure increases significantly, temporarily elevating its debt levels. However, this is part of a calculated growth strategy designed to stay ahead of demand curves.

3.3 Capacity Utilization

CCL is currently operating its existing facilities at nearly 100% utilization. However, new capacities, which were commissioned at various points during the year, are operating at lower levels—about 10% to 15% utilization. The company expects utilization rates to improve steadily in the coming quarters as these units stabilize and scale operations.

The Vietnam expansion, recently completed, will start contributing meaningfully to volumes from Q1 FY26. With this new capacity, CCL enhances its ability to cater to growing demand from global B2B clients and prepare for future contracts.

Section 4: Channel and Distribution Strategy

4.1 Quick Commerce and New-Age Retail

CCL’s channel strategy is evolving to meet modern consumer expectations. Quick commerce—platforms offering ultra-fast delivery like Blinkit, Zepto, and Instamart—has emerged as the fastest-growing channel. The company sees this segment outpacing traditional modern trade and general trade, given the convenience it offers to urban consumers.

CCL is actively onboarding more SKUs on these platforms and working on improving fulfillment logistics to support fast delivery requirements. This strategy aligns well with the changing habits of urban consumers, who prefer convenience and variety.

4.2 Regional Focus and Penetration Strategy

Geographically, the Southern region remains CCL’s stronghold due to historical coffee consumption trends. In this region, small pack formats dominate and contribute around 65% of sales. The company has maintained this trend while introducing newer blends in line with regional preferences.

In North, East, and West India, the company is adopting a more selective distribution strategy. Since coffee consumption in these areas is still developing, CCL is focusing on metro cities and urban hubs where café culture is more prevalent. The goal is to build a brand presence and gradually scale operations as consumer habits evolve.

Section 5: Pricing Dynamics and Consumer Trends

5.1 Pricing Model and Adjustments

CCL follows a cost-plus pricing model, meaning that it factors in all production costs plus a fixed margin while setting prices. This model is particularly effective in protecting margins during times of input cost volatility. The company also adopts a back-to-back contract execution model for both procurement and sales, minimizing negotiation at the transaction point and ensuring price stability.

During FY25, the company and the industry implemented a 30% to 35% price increase on larger packs due to higher coffee bean prices. However, smaller packs, especially sachets, retained their prices to avoid volume loss in a price-sensitive market like India. Instead, strategies like grammage reduction and blend reconfiguration were used to protect margins.

5.2 Consumer Behavior and Demand Outlook

India remains a price-sensitive market. The company did face some demand-side pressure during the year, but it expects this to be temporary. With café culture expanding and out-of-home consumption rising, particularly in urban India, the long-term outlook remains bullish.

In contrast to tea, which is deeply penetrated across the country, coffee still has significant headroom to grow, especially in Tier 2 and 3 cities. CCL sees this as a structural growth opportunity and is building capabilities to leverage it over the next decade.

Section 6: Global Coffee Market Outlook

6.1 Pricing Trends and International Outlook

Over the past few months, coffee prices have shown signs of stabilization. However, with the upcoming harvest in Brazil—one of the largest coffee producers globally—market dynamics may shift depending on the crop size and export volumes. CCL is monitoring these developments closely as they have direct implications on procurement costs.

Globally, developed markets like Europe and North America are saturated, offering little room for volume growth. Conversely, emerging markets such as India, China, and the Middle East are witnessing growing coffee adoption. These traditionally tea or non-coffee markets are expected to fuel demand growth over the next 10 to 20 years.

6.2 Strategic Competitive Positioning

CCL’s global footprint and sourcing relationships place it in a strong position to navigate international volatility. Its ability to customize blends and offer premium private label solutions makes it a preferred partner for many global retailers. The expanded capacity in Vietnam will only bolster its competitiveness further.

Section 7: Strategic Initiatives and Vision

7.1 Capacity Expansion and Technology

The company’s decision to expand capacity every few years reflects its proactive approach to managing future demand. Technological integration is also becoming a core part of operations, with enhanced forecasting, inventory planning, and SKU-level pricing models being implemented.

7.2 Strategic Roadmap for FY26

Looking ahead, the company plans to:

• Scale Vietnam capacity to at least 50% utilization within the next two quarters.
• Deepen market presence in Northern and Eastern India through retail partnerships.
• Expand offerings on quick commerce platforms with high-turnover SKUs.
• Continue optimizing costs through backward integration and re-blending.
• Sustain its 15%-20% profitability growth guidance for FY26 and beyond.

Section 8: Risk Factors

The company faces several short and medium-term risks:

• Working capital pressure due to tightening supply and shorter payment cycles.
• Sensitivity of Indian consumers to price increases.
• Geopolitical and supply chain disruptions affecting international logistics.
• Dependency on commodity cycles such as the Brazilian coffee harvest.

Conclusion

CCL Products (India) Limited has successfully navigated a challenging macroeconomic and commodity environment in FY25 to deliver double-digit growth in both revenue and profitability. With strong foundations in both domestic and international markets, clear execution strategies, and a focus on long-term profitability, the company is poised for continued leadership in the global coffee space.

Its strategic investments in capacity, focus on branded retail, technological enhancements, and channel diversification make it well-equipped to deliver sustained growth in FY26 and beyond.

 Key Financial Ratios

 Strategic Priorities for FY26

• Ramp up Vietnam capacity to 50%+ utilization.

• Deepen branded retail distribution in North and East India.

• Expand quick commerce partnerships.

• Monitor global coffee pricing post-Brazil harvest.

• Sustain EBITDA/kg through cost control and product mix improvement.

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