| Vintage Coffee Private Limited | ||||||
| 'Crisil BBB- / Stable / Crisil A3 ' assigned to Bank Debt | ||||||
| Rating Action | ||||||
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| Note: None of the Directors on Crisil Ratings Limited’s Board are members of rating committee and thus do not participate in discussion or assignment of any ratings. The Board of Directors also does not discuss any ratings at its meetings. | ||||||
| 1 crore = 10 million | ||||||
| Refer to Annexure for Details of Instruments & Bank Facilities |
Detailed Rationale Crisil Ratings has assigned its ‘Crisil BBB-/Stable/Crisil A3’ ratings to the bank facilities of Vintage Coffee Pvt Ltd (VCPL).
The ratings reflect the company’s established market position in the coffee industry, supported by the extensive experience of the promoters, and geographically diversified revenue profile. These strengths are partially offset by susceptibility to volatility in coffee bean prices owing to climatic conditions, working capital-intensive operations and project risks. |
Analytical Approach Crisil Ratings has applied its parent notch-up criteria to factor in support from the parent, Vintage Coffee and Beverages Ltd (VCBL). |
Key Rating Drivers - Strengths Established market position supported by the extensive industry experience of the promoters: The moderate scale of operations provides operating flexibility amid intense competition. Presence of over two decades in the coffee industry has enabled the promoters to gain strong understanding of the market dynamics and maintain healthy relationships with suppliers and customers, which will continue to support the business.
Geographical diversification in the revenue profile: VCPL caters to a wide number of clients in India and overseas, including Europe, Southeast Asia, the Far East and Russia. The company derives 60-70% of revenue from export. Diversity in geographic reach and clientele will continue to support the business risk profile. Through new capacities for spray dried and agglomerated coffee, and the upcoming manufacturing facility for freeze-dried coffee, the company plans to expand its footprint in the domestic market and tap new markets. |
Key Rating Drivers - Weaknesses Susceptibility to volatility in coffee bean prices due to climatic conditions: Coffee plantations have high fixed cost and their operating margin is vulnerable to less-than-normal production or inability to improve realisation. Pest attacks and inadequate rainfall may impact production and crop quality adversely. Despite its strong hold in the market, the business risk profile of VCPL is susceptible to seasonality in coffee production and climatic conditions.
Working capital-intensive operations: Gross current assets were at 220-322 days for the two fiscals ended March 31, 2025, driven by large inventory.
Exposure to project risks: VPCL has manufacturing capacity of 6,500 metric tonne per annum (MTPA) for spray dried and agglomerated coffee. The company plans to expand its capacity to 11,000 MTPA through capital expenditure (capex) of Rs 40-42 crore, funded entirely via internal accrual. Commercial production is expected to commence by March 2026.
Additionally, the company plans to set up its own freeze drying plant, which will have capacity of 5,000 MTPA. Commercial production is expected to start from March 2027. Estimated cost of Rs 480 crore is proposed to be funded via equity of Rs 215.76 crore in the form of preferential shares and warrants issued by the parent, VCBL, and supplier credit of Rs 265 crore. Timely completion of the projects within budgeted cost, along with ramp up of operations, remains a key rating sensitivity factor. |
Liquidity Adequate Bank limit utilisation was high at 87% for the 12 months through August 2025. Cash accrual is estimated at Rs 33.47 crore in fiscal 2025. Expected accrual of Rs 46-50 crore will sufficiently cover debt obligation of Rs 5-8 crore over the medium term. In the past two fiscals, the management has been raising funds from capital markets by issuing equity shares and convertible warrants, and the funds have been used to cover the capex and working capital expenses. Need-based support from the promoters and shareholders is likely to continue. Current ratio was healthy at 3.12 times as on March 31, 2025. |
Outlook Stable Crisil Ratings believes VCPL will continue to benefit from the extensive experience of the promoters and their established relationships with clients. |
Rating sensitivity factors Upward factors
Downward factors
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About the Company VCPL was incorporated in 2015 in Hyderabad as a wholly owned subsidiary of VCBL. The company converts coffee beans into instant coffee and products such as soluble instant coffee, including spray dried coffee and agglomerated coffee. Its manufacturing facility in Rachur, Telangana, has installed capacity of 4,500 MTPA. |
Key Financial Indicators
*Provisional numbers |
Any other information: Not applicable |
Note on complexity levels of the rated instrument: |
Annexure - Details of Instrument(s)
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| Annexure - Rating History for last 3 Years | ||||||||||||||||||||||||||||||||||||||||||||||||||||
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| All amounts are in Rs.Cr. | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Annexure - Details of Bank Lenders & Facilities | ||||||||||||||||||||||||||||
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Criteria Details
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