In a bold move that signals the maturation of India’s evolving Quick Service Restaurant (QSR) ecosystem, Tea Post— Gujarat’s fastest-growing organized tea café chain — has refiled its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for an IPO. Notably, the company had filed its draft papers on 30 March 2024, but the IPO was returned due to undisclosed reasons. Tea Post is well rooted in India’s undying affection for ‘chai’, yet powered by a modern asset-light business model, Tea Post IPO aims to raise funds for aggressive expansion and brand consolidation.
📌 Tea Post IPO: Snapshot
- Type of Offer: Fresh Issue + Offer for Sale (OFS)
- Fresh Issue: Up to 1,42,50,000 equity shares
- OFS: Up to 1,42,50,000 equity shares by IndiaNivesh Venture Capital Fund
- Total Issue Size: Up to 2,85,00,000 shares of face value INR 1 each
- Book Running Lead Manager (BRLM): Srujan Alpha Capital Advisors LLP
- Registrar to the Offer: Cameo Corporate Services
Key Shareholders and Offer for Sale
The primary seller in the OFS is IndiaNivesh Venture Capital Fund, which currently holds 36.69% of the pre-issue capital and plans to offload its entire stake (1.42 crore shares). The fund’s exit marks a strategic handover, making room for broader institutional and public ownership.
Other significant shareholders include:
| Shareholder Name | % Pre-Offer Equity |
|---|---|
| Acclaim Enterprise LLP | 33.96% |
| Aaradhya Tradebiz LLP | 4.64% |
| Darshan Anilbhai Dashani (Promoter) | 2.24% |
| Puneet Tibrewala | 3.35% |
Collectively, the top eight shareholders account for 85.91% of the company’s equity, underlining concentrated ownership prior to listing.
☕ The Tea Post Journey: From a Single Brew to 250+ Outlets
Launched commercially in 2016 after acquiring select outlets from ‘Tea Station’, Tea Post has grown to become Gujarat’s largest organized tea café chain by store count.
As of 31 March 2025:
- Total Stores: 253
- Company-operated: 65
- Franchise-operated: 188
- Geographic Spread: Gujarat, Maharashtra, Rajasthan, Madhya Pradesh, and 3 outlets in the UAE
- Formats: Small kiosk (185), Standard café (62), Flagship desi café (5), Dark kitchen (1)
This hybrid expansion strategy, combining company-owned units in high-visibility hubs with franchise outlets in surrounding clusters, has helped Tea Post retain control while maintaining scalability — a classic “cluster-based asset-light” approach.
📈 Financial Performance
Tea Post has delivered strong top-line growth, but is yet to post net profits. Here’s a snapshot of key financial metrics:
🔹 Revenue from Operations:
| Period | Revenue (INR Cr) | YoY Growth |
|---|---|---|
| FY22 | 25.88 | – |
| FY23 | 43.24 | +67.08% |
| FY24 | 54.02 | +24.92% |
| 9M FY25 | 49.03 | – |
🔻 Net Losses (Restated Profit):
| Period | Loss (INR Cr) |
|---|---|
| FY22 | (0.94) |
| FY23 | (0.94) |
| FY24 | (1.02) |
| 9M FY25 | (1.02) |
Despite the losses, average monthly revenue per café has consistently improved—a sign of strengthening operational throughput.
📊 Avg. Monthly Sales Per Café:
- FY22: INR 2.52 Lakh
- FY23: INR 3.38 Lakh
- FY24: INR 3.91 Lakh
- 9M FY25: INR 4.26 Lakh
- Company-Operated: INR 6.10 Lakh
- Franchise-Operated: INR 3.69 Lakh
📦 Revenue Mix: A Balanced Beverage + Snack Play
Tea Post’s strength lies in its diverse product range tailored to Indian palates and price sensitivity.
🥘 Revenue Composition (9M FY25):
- Tea: INR 31.06 crore (34%)
- Other Beverages: INR 21.32 crore (23%)
- Snacks (Indian + Global): INR 35.94 crore (39%)
- Others: INR 4.08 crore (4%)
Unlike global café chains focused on coffee, Tea Post is tea-forward, with over 15 varieties including masala, elaichi, ginger, iced teas, and more. Complementary snack offerings—like Poha, Thepla, Sabudana Vada, and wraps—boost ticket size and create strong food pairing value.
🏗️ Utilization of IPO Proceeds
Of the fresh issue proceeds, INR 39.47 crore will be allocated towards opening new company-operated cafés. The balance will go towards general corporate purposes (up to 25% of gross proceeds).
This capital will fuel Tea Post’s growth in premium locations through its flagship and standard formats, while continuing to expand via franchisees in satellite clusters.
📊 Operational KPIs (As of 9M FY25)
| Metric | Value |
|---|---|
| Total Bill Cuts | 53.88 lakh |
| Avg. Ticket Size | INR 171.50 |
| New Cafés Added | 31 (7 Co., 24 Franch.) |
| Revenue from Co. Cafés | INR 31.31 crore |
| Revenue from Franchise Cafés | INR 61.09 crore |
This data reveals a highly scalable model, with franchisees delivering over two-thirds of total sales. Importantly, all franchisees procure raw materials (tea blends, coffee powders, frozen goods) from Tea Post, ensuring quality control and creating an indirect revenue stream.
🧾 Risks & Investor Considerations
- Still loss-making: Despite revenue growth, bottom-line losses continue due to rising operational and employee costs.
- Heavy franchisee dependence: 66% of revenue stems from franchised cafés.
- Margins thin: Royalty and franchisee income, while growing, contribute less than 10% to revenues.
- Intensifying competition: New-age brands (Chaayos, Chai Sutta Bar) and legacy QSRs (Haldiram’s, Barista) compete for the same consumer wallet.
Riding the QSR Wave
According to the India Food Services Report 2024, India’s organized QSR market is valued at INR 67,440 crore and expected to double by FY28 at a CAGR of 17–18%. India’s 750+ operational malls, rising youth population, and increasing preference for casual dining have made QSRs the most dynamic sub-segment within the food services sector.
Tea Post sits at the intersection of this trend — bridging affordability, familiarity, and experiential dining, particularly for tier 2 and 3 markets where chai remains king.
Conclusion
Tea Post IPO debut is more than just another listing — it’s a symbolic entry for the Indian tea café industry into the formal capital markets. Built on deep cultural relevance, grassroots appeal, and an evolving café culture, Tea Post is attempting to redefine how India drinks its tea outside the home.
For investors, the stock offers an early opportunity to back a “Bharat-first” consumer play in an industry that’s still in its adolescence. However, its consistent losses and dependence on franchise-led growth are risks that warrant close monitoring.
For more details related to IPO GMP, SEBI IPO Approval, and Live Subscription stay tuned to IPO Central.