BENGALURU, India – India ’s out-of-home coffee market is projected to reach $2.6-$3.2 billion by 2028, with a compound annual growth rate (CAGR) of 15-20 per cent, according to a report issued by Redseer Strategy Consultants. The premium coffee segment (above Rs 200, or $2.3), which represented 46% of the market in 2023, is projected to grow to 55-60% of the market at a CAGR of 20-25%, underscoring its dominant role in shaping India’s outside coffee landscape, according
This segment targets affluent, discerning coffee enthusiasts with artisanal brewing and experiential consumption.
The mass market (below Rs 100) had 50% market share in 2023, which is projected to shrink to 30-35% by 2028, growing at a CAGR of 8-10%. While affordability remains its hallmark, the segment offers limited avenues for premium differentiation, the report mentioned.
Meanwhile, the mid-price range (Rs 100-Rs 200) which constituted just 4% of the market in 2023 is expected to grow to 8-10% of the market by 2028 at an impressive CAGR of 35-40%. This space offers immense potential for introducing specialty brews, making it a critical driver of industry expansion.
“Coffee has moved beyond instant and traditional brews to premium experiences. It is now a lifestyle product for Indian customers, with the mid-priced segment emerging as a whitespace to meet the growing demand for affordable options, offering both quality and enhanced experience,” said Rohan Agarwal, Partner, Redseer Strategy Consultants.
This market is ripe for brands to step in and deliver high-quality, accessible specialty coffee solutions, redefining India’s beverage landscape, he added.
While India’s outside coffee market offers vast opportunities, businesses must overcome key challenges.
“Supply chain complexities make it difficult to maintain quality and timely delivery across regions. Finding the right locations in high-traffic areas like malls and tech parks is crucial but highly competitive,” it added.
