The company has withdrawn its 1+1 offer on its products on amazon.in.
MRP 460/- product is been sold at 225/-⌠it is better than 1+1 offerâŚ
Parag parikh has bought in tax saver scheme 
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One of the filings with these recent quarterly results and board meeting says that it has a approved a plan to issue esops upto 8 percent of equity capital.
This is new.
Esops need to be used judiciously and 8 percent seems a bit excessive.
Any one else following developments with CCL closely ?
Disc. Have a small position from lower levels in the last one year.
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Its only in subsidiary CCPL. Must be for Praveen Jaipuria - they got him for Dabur and must have been part of the contract.
With a moderate growth of ~9% YoY growth in revenue and Net Profit, why is this stock rising? In fact the stock started rising even before the results were announced!
Am I missing something? Or the price rise is purely speculative nature?
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A few levers I see are in place after researching and attending the concall
- Demand for small packs (higher-margin products) is robust- currently have 5500MT capacity, looking to expand to 12000 MT by FY22
- Cold brew coffee which was served only to the US is getting enquiries both from US & other countries which mimmick US pattern such as China, Korea, Japan, Vietnam
- Indian retail business is also seeing good traction already did 100cr sales
- Better product mix to lead to increasing margins as premium FDC contribution will increase as a percentage of total revenue
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Its 8% of Continental Coffee Private Limited not CCL products. Considering that it is in startup phase, seems reasonable. However, thank you for bringing it to attention!
Bit old but useful.
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Thanks @valuelife for your insights.
Any assessment of these changes on the topline and bottomline? Approx numbers will also help
CCL Products Q4FY21 Earnings Call notes
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Vietnam, we did have optimum utilization during the current year and it will continue. In fact, we are enhancing the capacity there , so we are expecting a better performance in the coming year.
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Vietnam margins will improve on various fronts. One is, of course, the superiority of the product itself. And then we are able to â because we are in the heart of coffee land, the working capital requirements vis-Ă -vis working capital costs, et cetera, finance costs will be lesser. And in fact, one other thing to be noted is that the original plant is also getting depreciated in 2, 3 years. So the depreciation on account of the old plant might also come down, so there is an possibility for improvement of margins in Vietnam as such. Of course, we are in â right now we are doing some line balancing and augmenting the capacity. We are seeing a better traction and we might be inclined to double the capacity very soon . We are working on it actually. So maybe soon you will hear that we are doubling the capacities. And we are also evaluating the visibility of order books for that. We already have something concrete that is coming up. So maybe we will initiate, we will start the expansion in Vietnam by about September or so .
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Enhanced capacity taking time to come because there are no travel facilities available. And even if one of our â there is only one flight operating there. And even after going there, there is a 21-day quarantine. So for any technicians to go and work on the expansion part, it is taking â the person has to plan at least 1 month in advance, yes, but still we are almost at the stage of completion stage. And the facility should be, most likely, available from the first quarter end. July 1 onwards, it should be available for production .
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FY '21, we were able to operate our freeze dried capacity only to the extent of about [ 62% or also â 62% ] only because of the compulsive lockdown that we went through and then because of [ duration in the orders deferment ] and all that, yes. This year, there should be an improvement on that.
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Last year, disruptions were worldwide. Itâs not very specific to India as such, yes. So there was no alternative source for them also. In fact, in many cases, we have taken initiative to organize faster supplies wherever they are not able to manage containers or logistics from their end. We have managed them since then. There was no major complaints from the customers because all of them knew that this has been the case. And perhaps second thing that we are doing, what we have been doing is that â we have a warehouse in U.S. and our own customs bonded warehouse in Switzerland, yes, where there are some stocks, so there was no desperate situation that have come to any of our [ customersâ assets ]. Of course, the delays were there to the extent of reorder levels or minimum levels to be required, but there was no total out-of-shelf situation in any of our customersâ places.
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Capacity utilization in FY21 Freeze Died we did 61%; and spray dried, we did 70%-75%
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Indian business we touched a top line turnover of 150 crores (2/3 is brand and 1/3 is institutional), which is a substantial growth over last year wherein we were close to 90 crores. So we almost witnessed around 60%, 65% growth on the top line. As far as the bottom line is concerned, we were almost breakeven . Thereâs little margin loss this year because of higher input costs that â the bean prices went up. So there was a little â a very marginal loss this year, which was approximately, letâs say, minus 5 crores and roundabout. Branded coffee sale were 66% in FY21 compared to 55% in FY20 .
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We were looking at a growth of 30% to 40% in Indian business in FY22, but probably if things normalize from July onwards, then still we can look at a 25%, 30% growth this year, but a lot will depend on how quickly things will settle down because, everywhere, we are seeing lockdown, which is hampering the logistics, and supply issues out there. And once again, our institutional segment, which was â which started to pick up in the last quarter when slowly the hotels, the airlines, the offices have started opening where we started doing a decent amount of business in the last quarter, has again gone back to shutdown mode. And the business has come down to almost 0 there, so thatâs something to be worried about, but weâre just hoping and praying that things settle down from quarter 2.
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So the total Indian instant coffee market is around 2,000 crores. And as I told you a little while ago, our branded business was almost 100 crores, so we are close to a 5% market share. There are pockets where we are doing better than the overall averaged, wherein we have more than 5%. And every geography, we are witnessing a â good growths in market share every quarter.
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we currently are reaching around 1 lakh outlets, 95,000 to be very precise. Of course, our distribution expansion did take a hit because, first 6 months, we could not do any distribution expansion. Itâs only in the second â the third quarter and the fourth quarter we started. And considering the kind of situation, it was difficult to do distribution expansion because â difficult to find the right set of distributors in this scenario. So thatâs the reach, direct reach that we are having right now. We are looking to substantially upscale this and probably end the next year at around 1.5 lakhs outlet at least .
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in 2 years time we are looking to cross that milestone of the 250 crores top line in Indian business.
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in Brazil, the thing â because of the water shortage and all that, the arabica prices are going up, but if you look at it, in Brazil robustas, thereâs an excellent crop. There is no shortage. Thereâs a higher crop than what was there in the previous years. All the other countries which are growing robusta, including Africa, Vietnam, Indonesia, the robusta crop has been really good. And more than 90% of what we buy is robusta. So there is not that much pressure on the robusta prices, but it too rarely go up. If arabica is going up, robusta may be moving as well, but then in differentials there will be a change. From positive differentials, youâll have negative differentials, which is why, though there is a slight increase, we are not sure how sustainable that is in the long run. So we are still going on the assumption that green coffee prices will be similar to what they were in the previous year. And as everyone is already aware, since anyway we work on a cost-plus basis, that impact is going to be quite minimal for us when it comes to margins and all that.
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Capacity
India: 25000; Spray Died 15000 and Freeze Died 10000.
Vietnam: 10000 current and enhancing to 13500. -
For the past 2 years, we are making an earnest effort to improve our presence in U.S. We were around 10% in U.S. earlier, which in the near future we should be improving and anywhere to approximately 15% or so. Generally our solid existing percentage of sale would be about 25% in Europe, 25% in Russia and CIS markets. And then the others are spread over Africa and there â Africa, Asian countries
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we were able to compensate some of the lower utilization of freeze dried with our small packs. The small packs, the packing plant was delayed because of this COVID situation and all that, but by that time, we have already procured the machinery for the packing plant, so we were able to put those into operation and enhanced our small pack capacity this year. Because of which, we were able to compensate the freeze drying â reduction in freeze drying turnover. Going ahead, already we have spread the substantial visibility with our small packs in various markets. Not â I do not wish to mention specifically, but various markets, they have already created a visibility for small packs. So we are expecting for at least from the second â this year, by around August, September, we will be on full-scale small pack capacity. And we will utilize it for the full for the peak season, starting from October. Next year, we should be doing optimum utilization on small pack capacity as well .
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Last year, I think we have used about 5,500 tonnes with small packs . The capacity that we are installing is for 12,000 tonnes. It will be available for full-scale production somewhere around third quarter. I mean towards August, September of this year. So we should be utilizing almost the same capacity this year also. Year subsequent, it will be more.
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the entire small packs capacity is in India only. It is not there in Switzerland, nor â it is not there in Vietnam. We are contemplating to establish small pack capacity in Vietnam in due course, but currently all the small packs are done from India only.
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There are a lot of new initiatives that we are taking over there. And till now, U.S. market has always been only a bulk market for us. Slowly that is transitioning. Last year, weâve actually introduced our cold brew coffee in the U.S. Weâre the only company in the world that can actually make this particular product, and that became a really big hit. And we got an order of almost 20 containers, which was fully executed in small packs, to one of the larger supermarket chains . Seeing that, weâve actually started getting inquiries from different other parts of the world, where theyâve seen these products in the U.S. and theyâve asked us to introduce in their respective countries as well. Similarly we are getting into more of small packs in the U.S. market itself. We are having tie-ups with several organizations to start introducing the small packs. So thereâs a change. This is a more long-term efforts that we are looking at. Bulk is being extremely competitive, so thatâs one of the reasons why we are going more towards specific qualities and specific brands in this particular market. So all these efforts will keep giving us better dividends in the long term.
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On Cold brew front Weâve had some good progress for cafes also, especially cafes which are serving nitro cold brew. So of them, this product has been a huge favor. Earlier, the process they used to follow was to make the cold brew physically, and this used to take 16 hours and the shelf life also less. So with this version, theyâre able to give even the nitro cold brew at a much more economical cost to its â to their customers. Unfortunately, because most of the cafes across the world are still under lockdown, there hasnât been that much. So this is something that you consume in a cafe, not something that you would want to take as a takeaway. Thatâs one reason why it still hasnât â we still didnât get the volumes that we were expecting, but once things open up, we are hoping those volumes will start coming in. In the U.S., weâve actually gotten â or people have seen the product, whoâve â whoâs tried the product. A couple of guys have actually approached us, asking us for exclusivity, saying that theyâll give us at least 1,000 tonnes sale and all that, but we havenât accepted any of these offers because it means that we will be tied in with them and our margins will be limited. So we start. It doesnât matter. Let us grow slowly, but we will grow steadily.
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Big chains in US: Weâre already supplying to the big chains through some resellers or customers, people whom â like our customers in the U.S., they are confectionery companies, liquid coffee companies that buy the powder from us. And they supply some McDonaldâs, Wendyâs. You name it. All the major chains, they buy from these guys. So they keep â we keep developing new blends and products for these chains all the time. So this is one project that we are undertaking as well to institute over there. Earlier, they were buying mainly in liquid format. Now we are trying to convince them to buy in solid format as well.
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Vietnam we did about 375 crores turnover, with a profit of around 85 crores or so.
Switzerland, it is trading. We did a turnover of 180 crores and profit of 6-7 cr. -
volume growth guidance of 10% to 12% in fy22.
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CapEx is likely to be around 50 crores to 60 crores for fy22.
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Around FY24, we plan to reach about 50,000 tonnes sale capacity. Our production capacity will be slightly higher to that. Say 55,000 or 60,000. That is a goal on which we are working. How do we do it, whether in Vietnam or in India? Currently we have an infrastructure both in Vietnam and in India. If our spray-dried requirement will go up, it will be in Vietnam. If our freeze-dried requirement goes up, it will be in India. So we will be looking perhaps at the other locations after completing the expansion in these 2 places.
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Difficult to convert it into numbers but I wouldnât be surprised if they do a
Topline around 2200cr(PY-1246cr ) by FY25 and a PAT of around 360 cr (PY-180 cr)
Saw a couple of continental coffee trucks in hyderabad.
Talked to the person operating there, he said the trucks are owned by the company and they are employees.
They are selling Cappuccino small @ 30rs , intresting to see whether they will get into retail ccd like stores.
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They have also started commercializing on television. Saw a advertisement of freez dried coffee on Aaj tak first time
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CCL Management on BQ-
- We do not have a demand problem
- CCL wants to double top and bottom line in next 4 year.
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expansion of the installed manufacturing capacity of Instant
Coffee at M/s. Ngon Coffee Company Limited, Vietnam, a wholly owned subsidiary of the
Company, from the existing 13,500 MTs per annum to 30,000 MTs per annum at an estimated
project outlay of USD 27.5 Million.
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CCL is doubling capacity in Vietnam as they said in con call⌠But ⌠they are entering into plant based business⌠I am trying to understand how it is related to coffee.
Hi, Would anyone know CCLâs annual exports/exposure to Russia? While Russia is not comparable to Nordics and other European countries in terms of high per capita coffee consumption, nonetheless accounts for 3% of the worldâs coffee consumption as I once read.