Devyani International Ltd, franchisee of Costa Coffee in India and leading multiplex chain PVR INOX Ltd announced a strategic agreement on Thursday. Under the agreement, Costa Coffee’s “handcrafted hot & cold coffees” will be sold at some of the PVR INOX cinema properties.
Analysts said this will help PVR INOX to diversify its food and beverage portfolio.
Abneesh Roy, Executive Director, Nuvama Institutional Equities said this move is in line with the multiplex chain’s to premiumise and diversify its food & beverage offerings for consumers. He noted that PVR INOX is already one ofthe largest food and beverage retailers in the country.
PVR Inox is the leading multiplex player with over 1,700 screens and 360 properties. “We assume it will be only for the key metro cities. In case this is rolled out across the network, this could add a decent scale to Costa’s revenues. However, it will be at a much lower gross margin,” Roy added.