Costa Coffee India store count falls for first time in five years
Costa Coffee closes 22 outlets in India during FY26, its first network contraction in five years, as Devyani International prioritizes disciplined growth over expansion.
INDIA – British coffee chain brand Costa Coffee’s store count in India decreased to 198 outlets in FY26 from 220 a year ago, marking its first decline in over five years in a key market for the company.
Despite the reduction in its café network, the brand reported a 7% year-on-year increase in revenue.
According to the latest annual report of Devyani International Limited (DIL), Costa Coffee’s exclusive franchise partner in India, the chain recorded a net reduction of 22 stores during FY26. The decline follows several years of consistent expansion in India’s organised café market.
Costa Coffee’s revenue from operations rose to Rs 212.5 crore in FY26 from Rs 198.5 crore in FY25. The growth came despite a smaller store network, contrasting with FY25, when the brand posted 30.76% revenue growth alongside rapid outlet expansion.
The coffee chain has seen significant growth over the past five years, expanding from 44 stores in FY21 to 55 in FY22 before more than doubling its network to 112 outlets in FY23. It further increased its footprint to 179 stores in FY24 and 220 in FY25 before declining to 198 stores in FY26.
While Devyani International did not disclose the reasons behind the store reduction, the company said it adopted “a more disciplined and selective approach to expansion” across its brand portfolio during the financial year.
Costa Coffee’s Global CEO Philippe Schaillee had said in April 2025 that India is among the top 20 markets for Costa Coffee and is expected to be among the top five markets in the coming years.
DIL, in its annual report, said it is “continuing to strengthen Costa Coffee.” It added that alongside DIL’s other Yum! Brands units, Pizza Hut and KFC, Costa Coffee acts as a primary growth anchor for the company.
The brand focuses on capturing the country’s premium, out-of-home coffee culture by targeting Gen-Z and millennials.
“With its youth-centric rebranding, it has positioned itself as the preferred choice of coffee lovers seeking an upgraded ambience designed to serve as ‘social spaces’ for young professionals and students,” said DIL.
The company has also been refreshing its menu to align with evolving consumer preferences in India’s organised café market. The reduction in stores during FY26 suggests a shift toward a more measured expansion strategy after adding 176 outlets between FY21 and FY25.
India remains a key market in Costa Coffee’s long-term global strategy. Schaillee identified India as one of the company’s top 20 markets globally and said it is expected to become one of Costa Coffee’s top five markets in the coming years.
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