World's largest espresso coffee maker Lavazza today said it will invest 20 million euros (Rs 125.78 crore) in its Indian manufacturing facility at Andhra Pradesh and expects it to become the second-largest market for the company after Italy in the next five years.
Lavazza Group Vice-President Giuseppe Lavazza said the operations in the existing facility in Chennai will be moved to the new plant being set up at Sri City multi-product Special Economic Zone (SEZ) in the Nellore district.
"We will invest 20 million euros in this region. Initially, the new facility will cater to the Indian sub-continent, but will gradually export to all Asia-Pacific regions. Our target is to evolve the Indian market as our second-largest market (after Italy) in the next five years. The current revenues from this region are 30 million euros," Lavazza told reporters.
According to the Italy-based company, curretly France is the second largest market for the company with 100 million euros (Rs 628.89 crore) revenues after Italy, which accounts for more than 600 million euro (Rs 3,773.4 crore).
Currently, the global turnover of Lavazza is at 1.13 billion euros (Rs 7,106.57 crore) with 60 per cent from Italy, while the remaining 40 per cent is from outside Italy.
Lavazza said the company intends to maximise revenues from abroad.
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"We have a 50 per cent market share in Italy, a market which comprises 30 per cent of Espresso consumption. But going further, we would like to see our revenues 50:50 ration from Italy and international," he explained.
The proposed facility, which will become functional by May 2012, will have a production capacity of 1,600 tonnes per annum and will employ over 150 people. In Italy alone, the company sells about 70,000 tonnes per annum, he said.
In 2008, the company acquired Barista brand of coffee outlets and Fresh & Honey stores in India. It has over 200 outlets across the country under Barista brand, besides an installed base of 5,000 'away-from-home' coffee vending machines.