My Best Pick 2019

Niraj Dalal

The founder of 3A Capital believes that a revamp of the CCD business and rejig of investments could get Coffee Day Enterprises crackling again

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Published 2 years ago on Apr 22, 2019 6 minutes Read
RA Candroo

My daughter’s passion for tennis is ensuring that I travel every alternate weekend to accompany her to tournaments. While wins are not always on the cards, we do get to spend a lot of time together, especially over coffee and cakes! On one of my recent visits to a Café Coffee Day (CCD) outlet in Nashik, I was surprised to see that the cafe was full. My subsequent visit to Kolhapur reiterated the same thesis with the outlet witnessing a regular stream of visitors. The reason I mention Kolhapur and Nashik is because the cafe culture in South Mumbai is not representative of other parts of India and, hence, the time spent in Nashik and Kolhapur was an eye-opener and gave me the belief that, maybe, CCD has got something right.

Mentally I made a note to thank my daughter — for she was the reason that I engaged in some primary and secondary research into one of my most hated investments! Coffee Day Enterprises had gone public at Rs.325 in 2015, and since then the stock price has done nothing. Four years with no return in a market that has produced several multi-baggers, means a lot of disappointed folks like me. However, after you go through the details below you will be just as convinced as I am that you can’t buy happiness, but you can buy coffee and, for an investor, this brew at Rs.287 a share might just be the shot of happiness that the doctor ordered.

The Inside Brew

Headquartered in Bengaluru, Coffee Day Enterprises (CDEL), the parent company of the Coffee Day Group, is an organisation with diversified business interests in the areas of coffee, technology parks, logistics, hospitality and financial services.

With a sprawling network of over 1,750 CCD outlets spread across 241 cities and towns in India and 53

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