New Delhi, July 13 -- Homegrown private equity firm Kedaara Capital is in advanced talks to acquire a significant stake in a fast-growing specialty coffee chain, at least two people familiar with the matter told VCCircle.
The investment firm, which is currently deploying from its fourth fund, manages more than $5.5 billion across consumer, financial services, healthcare, and technology sectors.
Blue Tokai, one of India's leading specialty coffee retailers, is in discussions with Kedaara Capital to raise fresh funding.
The coffee chain is looking to raise around $100 million (Rs 956 crore) in a fresh round, the people cited above said. The proposed transaction is likely to comprise both primary and secondary components, although the final structure is yet to be decided. The proposed deal may value the coffee chain at more than Rs 2,000 crore ($209 million), the people added.
Emails sent to Blue Tokai and Kedaara Capital remained unanswered till the time of publishing this article.
Founded in 2013, Blue Tokai sells specialty artisanal coffee through its cafes and roasteries. Its product portfolio also includes cold brew cans, easy-pour sachets and biodegradable coffee capsules.
The company currently operates about 240 stores across major Indian cities and aims to expand its network to around 800 outlets by 2030, according to recent media reports.
Blue Tokai last raised capital in late 2024, when it secured $35 million (Rs 293 crore then) from Belgian consumer-focussed investment firm Verlinvest. Existing investors Anicut Capital and A91 Partners also participated in the Series C round.
Earlier, the company raised around $30 million in its Series B funding round in 2023. It had also secured Rs 17 crore from Anicut Angel Fund in August 2022 and nearly Rs 40 crore from early-stage investors and angel investors in 2020.
For the financial year ended March 2025, the company reported a consolidated net loss of Rs 76.5 crore, up from Rs 62.9 crore a year ago, while net sales rose sharply to Rs 325 crore from Rs 215 crore, according to VCCEdge, the data and research platform of VCCircle.
Blue Tokai competes with players such as Third Wave Coffee, Slay Coffee, Sleepy Owl Coffee and Rage Coffee, several of which have also attracted institutional funding as competition in India's premium coffee market intensifies.
Separately, in May, quick-service coffee chain Abcoffee secured Rs 61 crore ($6.4 million) in a pre-Series B funding round led by Kliff Ventures, the newly launched consumer retail fund backed by K Hospitality Corp.
Published by HT Digital Content Services with permission from VC Circle.