Leading Italian coffee brand Caffe Pascucci has entered India by setting up its first outlet here to retail imported blended coffee. The euro 600-million (Rs.4,060-crore) Pascucci has roped in the city-based Madhura Beverages India as its master franchisee for setting up a chain of outlets across the country.

"Our franchisee will invest Rs.600 million (Rs.60 crore) over the next three years to set up about 60 outlets across India, including 10 in Bangalore, five each in Chennai, Hyderabad, Mumbai, Pune and New Delhi over the next 18 months," Caffe Pascucci managing director Mario Pascucci told reporters at the soft launch of the maiden outlet on the posh MG Road.

In spite of a whopping 120 percent import tariff levied on blended coffee, Pascucci will ship the ingredient from its roasting plant at Montecerignone in Italy in a blended form as the coffee beans are sourced from Latin American countries such as Columbia, Haiti and Brazil. "Our products range from plain espresso to rich Italian specialties, which can be sipped with cream mousse, coconut or chocolate as extra ingredients. We will also sell flavoured tea, iced tea and coffee-based recipes," Pascucci said. The five-decade-old family-run Italian firm also plans to set up a roasting and blending facility in India to reduce the production cost and minimise logistic overheads.

"Once we establish our global brand presence and build volumes, we will be able to set up a roaster and blending plant here. We will also explore using Indian coffee variety such as Arabica and Robusta, which have a distinct flavour," Pascucci said. About 70 percent of coffee produced in the southern states of Karnataka, Tamil Nadu and Kerala are exported as domestic consumption remains sluggish due to intense competition from other soft beverages like colas and changing lifestyle.

The Rs.300-crore Madhura group is scouting for prime locations in metros and prime cities to roll out the Caffe Pascucci outlets. The retail coffee outlet market in India is estimated at about Rs.650-700 crore and growing at 25-30 percent annually. Cafe Coffee Day and Barista are among the prominent retail chains in the country, there are several other international players as well, that include Gloria Jeans Coffee, Costa Coffee, Coffee Bean and Tea Leaf and the recent, Aromas Coffee Franchise from Australia

Pascucci has around 100 outlets in about 20 countries, including South Korea, China, Qatar, Saudi Arabia and Dubai. "Our focus is to bring select premium food and beverages brands to India from Europe and Caffe Pascucci is our first venture. We will also be offering a range of teas, pastries, cakes and Italian food," Madhura Beverages managing director V.S. Sudhakar said. The franchisee hopes to break-even in the fourth year of operation.