Coffee’s journey in India is believed to have begun in the 17th century when Sufi saint Baba Budan brought seven coffee seeds from Mocha and planted them in Chikkamagaluru, Karnataka. From those humble beginnings emerged a thriving coffee industry. Narasu’s, a century-old Tamil Nadu brand, mirrors this evolution. Having weathered ownership changes and made a bold entry into instant coffee, it is now challenging multinational giants in a classic David versus Goliath battle.
Since 1919…
Narasu’s was founded in 1919 as a wholesale trader of raw coffee. In 1926, the company expanded its operations into coffee roasting and grinding, marking the beginning of its journey toward building a modern coffee industry. This vision was driven by its founder, V Lakshmi Narasimhan, affectionately known as Narasu. Under his leadership, the company steadily grew and established four branches across the city of Madras (now Chennai), laying the foundation for the Narasu’s brand. The company’s new office building and factory in Johnsonpet, Salem, was inaugurated in 1939 by the then Minister for Industries and Labour, V V Giri, during the British regime. “Owing to the increased public demand for this kind of coffee, we are now installing most powerful and modern plants in our factory. We have been pioneers in the sale of powdered coffee on a mass scale to cater to the demands of our large number of customers,” Narasu had pointed out in his speech during the factory opening in 1939.
Bold Double-Revenue Investment
Post-demise of Narasu, the company was acquired by R P Sarathy and his family members in 1966, as it went into financial troubles. “My grandfather and my father, R P Sarathy, were already running Vasantha Coffee and Sarathy Coffee. Post the acquisition of Narasu’s Coffee, my father and his brothers were running the show and developed the business further,” points out Sivanantham, present Chairman, Narasu’s Coffee.
Like many family businesses, Narasu’s Coffee also saw a family churn and separation of businesses. In 2006, Sivanantham took full control of Narasu’s Coffee as part of a business separation agreement between him and his sisters. In 2009, the company was converted from a partnership to a limited company, following various lawsuits and alterations. “A major turning point came when the company forayed into instant coffee production in 2002,” says Sivanantham. The company then invested nearly Rs 60 crore in the instant coffee plant in Salem, 15 km away from the existing one. The investment was nearly double the revenue back then. At that time, the instant coffee market was dominated by multinational and big domestic players like Nestle, Unilever, Tata Coffee and CCL Products (India) (which owns the brand Continental Coffee). “We were entering the market as a fifth player. At that time, several questions were raised against this move,” notes Sivanantham. “A fear psychology was played on us and it acted as a motivation for us to be cautious and see that we don’t lose the battle,” he adds. This led to the production at the new plant just 12 months from breaking ground.
Now, the company has a production capacity of around 9000 metric tonnes per year for roast and ground coffee (filter coffee) and 8000 metric tonnes per year for instant coffee. The company exports to over 40 countries, including the USA, Canada, Europe, the UAE, Malaysia, Singapore and Australia. Its current annual revenue stands at Rs 641 crore, with domestic sales accounting for 50 per cent and the remaining coming from exports.
Brewing Beyond Borders
Narasu’s plans to expand its footprint in Karnataka, Kerala and Andhra Pradesh and also other parts of the country. “Today, we have a strong network of distributors and dealers. We see immense potential in the southern region and aspire to capture a significant market share. Our vision is clear: to bring the authentic south Indian coffee experience to every modern kitchen across India and beyond,” says Srudheep S, Managing Director.
As Narasu’s enters its next phase of growth, the company is strengthening its digital presence, aiming to increase online sales from 5 per cent to 20 per cent of its distribution mix. It is targeting revenue growth of 18–20 per cent in FY27 and has set an ambitious goal of achieving Rs 1000 crore in revenue within the next five years. With a balanced portfolio of traditional and instant coffee, Narasu’s is building on a century-old legacy. The iconic brand now stands poised to transform from a regional favourite into a nationally and globally recognised coffee name.n
Grounds for Growth
India’s coffee industry is concentrated in Karnataka, Kerala and Tamil Nadu, which together account for nearly 96 per cent of the country’s production. Karnataka remains the largest producer, with an estimated output of 280,275 metric tonnes (post- blossom estimate for 2025–26), followed by Kerala and Tamil Nadu.
According to a 2023 Crisil study commissioned by the Coffee Board of India, consumption rose from 84,000 tonnes (green bean equivalent) in 2012 to 91,000 tonnes in 2023. Growth has been driven by higher at-home consumption, increasing penetration of instant coffee and the expansion of café culture across the country.
South India continues to dominate coffee consumption, accounting for 75–80 per cent of total demand. However, coffee adoption is rising in other regions as brands expand their retail presence. Urban areas remain the largest consumers, supported by growing café networks in metros and Tier-1 and Tier-2 cities. According to a CRISIL report, instant coffee now accounts for nearly 65 per cent of consumption, reflecting consumer preference for convenience and affordability.