Temasek, ChrysCap brew up plans for Blue Tokai stake, put Rs 1000-1200 crore on the table

New Delhi|Mumbai: Singapore investor Temasek Holdings is vying with ChrysCapital to invest Rs 1,000-1,200 crore in Blue Tokai Coffee Roasters at a Rs 3,550-3,700 crore valuation and emerge as its single largest shareholder, people aware of plans told ET.

The 13-year-old homegrown specialist coffee chain, one of the strongest competitors of Starbucks in India, has been in the market scouting for growth equity after turning Ebitda-positive on a monthly basis for the past six months. It is seeking funds to triple its store network in India, expand in Japan and the UAE, and offer liquidity to existing seed investors.

The capital raise is expected to see one investor end up owning 30-33% of the company, or the stake split between two to further diversify cap table.

Its current investors include Verlinvest — family office of world’s largest brewer, AB Inbev — A91 Emerging Fund, Waterfield Fund, 12 Flags and Waterfield Fund, among others.

Also read: Wholesale milk prices in Mumbai to rise ₹9 per litre to cross ₹100 from Sept 1

This will be the largest round for the roasters so far, and involve a combination of primary and secondary fundraising. Blue Tokai’s total equity funding across 13 rounds stands at $113 million.

Blue Tokai’s current valuation is Rs 2,280 crore, with the founders’ aggregate shareholding at Rs 349 crore as of August 7, according to Tracxn. Currently, A91 is the largest shareholder with 21.72% stake, while the three founders together own 15.27% of the company.

The expansion spree and investor frenzy reflects growing demand for premium coffee among India’s affluent consumers, driven by wider availability through digital channels and quick service chains.

F&B bets galore

Both Temasek and ChrysCapital have deep experience supporting food and beverage companies in India and overseas.

Temasek has backed India’s largest ethnic snacks maker Haldiram’s, frozen and fresh meat seller Licious, and Rebel Foods that owns a portfolio of restaurant and cloud kitchen brands such as Behrouz Biryani, Faasos and Mandarin Oak. In coffee, its portfolio includes Luckin Coffee, after the Chinese chain staged a remarkable turnaround having declared bankruptcy five years ago.

ChrysCapital acquired patisserie chain Theobroma in August 2025 for close to Rs 2,410 crore. Industry watchers said that for ChrysCapital, Blue Tokai could offer far more strategic synergies. If successful, it could even explore taking a larger bet in the company and subsequently even evaluate a merger between Theobroma and Blue Tokai.

Also read: India weighs Canada-style warnings on packaged foods high in sugar, salt or fat

However, no decision has been taken on that yet.

Temasek and Chrys Cap declined to comment.

“All three brands we operate are growing extremely well. We see lots of headroom for that to continue,” said Matt Chitharanjan, cofounder, Blue Tokai, in response to ET’s query. He declined to comment on specifics of fundraising and discussions about a potential stake sale.

Power of three

Blue Tokai, founded in 2013 by Chitharanjan, Namrata Asthana and Shivam Shahi, operates as a retailer of freshly roasted coffee beans and cafes, and differentiates from rivals with a farm-to-cup positioning, which according to its website, means sourcing freshly roasted arabica coffee beans.

Having begun as a direct-to-consumer coffee business, Blue Tokai has expanded its business to cafes, packaged coffee, and subscription offerings. Last year, it partnered UAE's Ambrosia Gulf to set up stores across the region. It acquired bakery brand Suchali’s Artisan Bakehouse in 2024, which enables harnessing synergies to serve meals in cafes.

Parent Muhavra Enterprises operates 240 outlets in India and plans to increase count to 800 by fiscal year 2030, Chitharanjan was quoted as saying last month. That includes about 120 stores planned in the current financial year to deepen its presence in major metros, while expanding into newer cities such as Ahmedabad and Lucknow.

In FY25, Blue Tokai reported revenue of Rs 325 crore, a 50% year-on-year increase. Losses dropped by 20.6% to Rs 50 crore, regulatory filings showed. The retailer has not yet filed its FY26 earnings.

According to people in the know, in FY27, the company is expected to clock Rs 750-775 crore revenues with 40% Ebitda margins.

“Both Blue Tokai and Third Wave Coffee have similar scale, but Blue Tokai makes almost double the revenues and is turning profitable, which is why investors are making a beeline,” said an industry official familiar with the developments.

Devyani International-operated Costa Coffee, Cafe Coffee Day, Barista, Pret a Manger in a franchise partnership with Reliance Brands, Canada’s Tim Hortons and Third Wave are among the chains competing for share within the premium coffee segment.

However, analysts say steep real estate costs have led to continued losses for some of the chains. “The white spaces for branded cafes are enormous. Now profitability and consolidation will be the next steps,” the executive added.

Research firm IMARC Group projects the café market, valued at $425 million in 2025, to grow 11.14% annually to $1.15 billion by 2034 in India.

Starbucks, which operates in India through a joint venture with Tata Consumer Products, is the largest and plans to add up to 100 stores every year to its current network of over 500.

With aspirational coffee chains outpacing growth of quick service restaurants, fuelled by young consumers and premiumisation, Blue Tokai also saw interest from some of the marque private equity names, including TPG, General Atlantic and Warburg Pincus.