By :

Trupti Jadhav
Tejal Pawar
Reshma Raul

CAFÉ
Pradnya Ranjane

COFFEE
DAY
A L OT C A N H A P P E N OV E R A C O F F E E
 ENLIGHTENMENT TO CCD

Cafe Coffee Day was incorporated in 1996

Mr Siddhartha’s family has been in the coffee
business for more than 130 years. Large
organized retail coffee chain in India.
 Cafe Coffee Cafe Coffee Day has 1,752
outlets across India as of March 2019.
 ENLIGHTENMENT TO CCD

1993 – Amalgamated coffee bean

1996 – Café Coffee Day’s 1st outlet at
Bangalore
2000 – Launch of financial advisory
services
2005 – Coffee day Global Launch at Vienna,
Austri.
2006 – Launch hospitality venture (Serai,
Cicada)
 HIGHLIGHTS OF STUDY

On 29th of July 2019,V.G Siddhartha went missing and after 2 days his body was found.
He left a note to his employees stating the major reasons behind committing a suicide
1. Debt
2. Market fall down
3. Tax terrorism
CCD stock has fallen from the peak of ₹374.60 to ₹110.95 on 1St August 2019.
Cafe Coffee Day (CCD) has total debt of around ₹11,000Cr.
IS IT A CORRECT DECISION TO BORROW SHORT TERM
LOANS TO REPAY THE LONG TERM DEBT? WHAT WOULD
YOU HAVE BEEN DONE IF YOU WERE IN HIS POSITION?

DEBT GRAPH
 What is short term and Long term 7000
loan ? 6000

Easy availability of short term loans 5000

4000
Excessive investments in assets and
3000
building huge infrastructure
2000
Low liquidity of assets 1000

0
FY 2015 Fy2016 Fy 2017 FY 2018 FY 2019
SUGGESTIONS

Investments in liquid assets

Proper utilisation of profits
Ethical business practices
Avoid rapid expansion in low
margins
 AS SIDDHARTHA’S DEBT IS NOT ONLY BUSINESS DEBT
BUT HE IS ALSO HAVING A HUGE PERSONAL DEBT.SO
WHAT MONEY LESSON AN ENTREPRENEUR OR AN
INVESTOR SHOULD LEARN FROM THIS?

Separate family affair from those of the

business
Avoid debt to buy depreciating assets
Understand how major liabilities are
repaid
AFTER VG SIDDHARTHA DEATH COCO COL A SHOULD TO
BE AS A STRATEGIC PARTNER OR NOT?

Opportunity to expand in existing Indian

market
Use of CCD’S network and loyal
customers
Value Investing
COCO model
 CONCLUSION

Not all the doors were closed before Siddhartha and CCD for the promoters
to end his life citing business failure. Selling their assets and parts of their
shareholding would have given there a chance to concentrate on their core
business.
The income tax department has acted as per law in its probe against Café
Coffee Day promotors VG Siddhartha.
They should have proper capital structure. Financial stress was there but CCD
wasn’t a whole failed business.
THANK YOU