Coffee and Capital: A Quiet Boom Brewing in India

Over the past two years, I’ve been quietly experimenting with coffee. I’ve always admired people who could talk about it with passion; the kind who debate grind size like it’s philosophy. I wanted to bring that café experience home. It all began with an Instagram reel. Someone casually said you don’t need fancy gear to brew a great cup. Just freshly roasted coffee (not older than 3 weeks), hot water, and a South Indian filter. That reel sparked something. Soon, I was diving into grind sizes, brew methods, and water ratios. Turns out, it’s not that hard — just layered.

  As I got deeper into the cup, my mind drifted toward the business behind it — especially India’s growing specialty coffee market.

The Rise of India’s Specialty Coffee Scene

  My research confirmed what my curiosity suspected: the specialty coffee business in India is booming. it really took off in the early 2010s. The turning point? Blue Tokai Coffee Roasters launching in 2013. They set a new benchmark not just in roasting, but in mindset. Soon, others followed: Third Wave Coffee, Araku, KC Roasters, and more.

  While data on most brands is limited, I found recent numbers for FY23–24 for Blue Tokai and Third Wave. Here's how they look:

Financial Comparison Table:

Particulars	Blue Tokai	Third Wave Coffee
Total Revenue (₹ Cr)	221.1	241.3
Net Loss (₹ Cr)	63	110
EBITDA Margin	-19%	-35.5%
Stores (approx.)	130	114

Key Financial Insights

• Revenue Growth: Blue Tokai's revenue grew by 70%, and Third Wave’s by 67% in FY24 ; strong momentum.
• Profitability: Both remain loss-making. Blue Tokai reduced its EBITDA loss from -24.7% to -19%. Third Wave is still deep in the red at -35.5%.
• Expenses: Blue Tokai’s employee costs jumped 95%, rent by 94%, and procurement costs also surged. Third Wave faced similar cash burn pressures.
• Cash Position: Blue Tokai ended FY24 with ₹61 crore in cash, Third Wave with ₹120.4 crore.
• Store Expansion: Blue Tokai now has 130+ stores and plans to scale to 350 in three years. Third Wave is also aggressively expanding.

My Take

  Both these brands are burning cash today, but they’re building presence. If they maintain quality and smart expansion, profitability will follow. What’s interesting is the rising interest in home brewing; especially among 21–30-year-olds who want café-quality coffee at home. That’s a business opportunity waiting to be tapped.

And Then There’s Starbucks

  Starbucks isn't technically a specialty coffee brand, but it’s a premium one and too big to leave out of this story.

In FY24–25, Starbucks India reported:

• Revenue: ₹1,277 crore (up 5% YoY)
• Net Loss: ₹135.7 crore (up from ₹82.2 crore in FY23–24)

  Though profitable at the store level, its overall losses are driven by rapid expansion. It added 58 new stores, reaching 479 stores in 80 cities, with plans to hit 1,000 stores by FY27–28.

What the Numbers Say

  Specialty and premium coffee is booming. The Indian coffee market is growing at a CAGR of ~10%, far outpacing the global average of 2.5–3%. The market was valued at $552.9 million in 2023 and is expected to more than double by 2032.

What’s Driving This Growth?

• Changing Consumer Preferences: Coffee has become a lifestyle a symbol of individuality and modernity. Young consumers (especially 18–24) are embracing specialty coffee for its flavor, origin stories, and brewing methods.
• Brand Expansion: Both global giants like Starbucks and local players like Blue Tokai and Third Wave are scaling fast, bringing specialty coffee to more corners of India.
• Home Brewing Innovation: Capsules, grinders, AeroPress, pour-overs; the at-home brewing market is maturing, offering café-like experiences at home.
• Sustainability & Traceability: Consumers care about where their coffee comes from how it’s grown, processed, and sourced. Brands that offer traceability and ethical sourcing are winning trust.
• Export Growth & Global Buzz: India’s specialty coffee exports are rising. Blue Tokai is even expanding into Japan. That global attention is building local prestige.
• Tier II & III Expansion: Coffee is no longer a metro-only affair. Smaller cities are discovering specialty blends and the brands are reaching out to them.

And One Insight That’s Hard to Ignore

  According to a study there is evidence that Gen Z in India is generally drinking less alcohol than previous generations, with a strong emphasis on health, mindfulness, and social experiences that don’t center around alcohol. This generational shift sometimes called the “sober curious” movement has contributed to the decline of alcohol’s cultural and the rise of alternative social beverages, including specialty coffee.

  Cafés are replacing bars as gathering spots. Coffee is becoming the reason people meet, not just the thing they drink when they do.

The Money Margin

  Coffee is the product, but the real business is about behavior, lifestyle, and identity. The margin isn't just in the beans — it's in:

• The shift from alcohol to coffee as a social anchor.
• The rise of personal rituals like home brewing, as quiet luxury
• And brands spending heavily today to own habit and culture tomorrow

  The P&L may show losses now, but the long-term bet is on behavioral real estate. Whoever owns the habit, wins the margin. That’s the kind of signal I look for; not just in coffee, but across how money and culture quietly shift together.

Final Brew

  What started as a personal experiment with a South Indian filter led me into one of the most interesting and fast-growing markets in India.

Behind every cup, there’s a business story.

And behind every financial story, there’s a cultural shift.

That’s the kind of blend I’ll keep writing about.

Why I Started The Money Margin

I’ve always had a strange relationship with money. Not in the “I want to be rich” way, but in the quiet curiosity of how it works, how it behaves, and most importantly, how people behave around it.

Growing up, I watched money move — sometimes quickly, sometimes quietly — through ledgers, through lives, through moments of stress and celebration. I saw it in my father’s factory, where I first learned that business wasn’t just about profits. It was about decisions, margins, trust, and timing.

And somewhere between those dusty account books and the neatly ruled notebooks I carried during CA articleship, I fell in love with clarity — the kind that comes when numbers begin to make sense. That clarity, however, wasn’t always easy to find in the noise of financial jargon, tax codes, or market chatter.

I have learned that there is a story behind every number. Numbers just don’t show up in a cash flow statement or in a balance-sheet. They have a history, a story. Somewhere someone made a choice, a decision and as a result numbers show up.