Australian coffee chain Aromas ties up with Ideal Hospitality

Australian coffee-chain Aromas has tied up with Ideal Hospitality Private Limited (IHPL) to enter the market in India and Southeast Asia.

''We plan to enter India by end-this month and over the next three years expand our footprint pan-India to have a 99-strong network," Jayant Mhaiskar, chairman and managing director of Ideal Hospitality, told reporters.

IHPL hopes to launch two Aromas brands - Cafe and Cafe Lounge – targeting mostly brand-conscious college students.

"The coffee market is emerging in India. The domestic market has grown by 15 per cent with a consumption of one lakh tonnes of coffee per annum. To tap this market, we have tied up with Aromas to open coffee outlets across the country, including at airports," Mhaiskar said.

The hospitality chain would be investing Rs50-75 crore to open around 99 outlets, he said, adding that 60 per cent would be Cafe Lounges while the rest would be Cafes.

Under the agreement Aromas would be paid 15 per cent of the gross revenue earned through sale of the Aromas brand in India and Southeast Asia, Mhaiskar said.

Aromas would hold a five per cent stake in IHPL and would also get a one-time fee on opening of every new outlet, he said.

The coffee beans would initially be procured from Aromas' roastery in Australia and would be procured from within the country itself later on. IHPL also has plans to set up a roastery in south India after building up a network of around 50 outlets, he said.

For Southeast Asia, IHPL would use the franchisee route, Mhaiskar said, adding, the two formats would serve coffee, tea and wine as also pre-cooked foods from the Cafe Lounge kitchen.