RPG to foray into coffee chain business

RPG to foray into coffee chain business

Chennai: RPG Enterprises on Friday said it would foray into coffee chain business by setting up a joint venture company with Boston-based fast cafe chain Au Bon Pain.

“The Boston-based company would have 20% stake in the coffee chain, while we will hold 80% stake business in the venture which will start in the next few months," Sanjeev Goenka, RPG Enterprises vice chairman, told reporters here.

Initially, six ‘stand alone´ cafes would come up in Bangalore by the last week of October or in the first week of November.

“Once these coffee chains have been set up, it (stand alone cafes) will be of separate entity," Goenka said.

RPG also proposes to increase its overall trading share in the apparel industry space, he said.

“We are at 10 lakh square feet of trading area today and will get to 12 lakh square feet by March 2010. Total investment in retail business (including loss funding and capex) will be confined to Rs260 crore during this year (2009-2010)," Goenka said.

He said the company has been able to cut costs by Rs100 crore per year through consolidation.

On the company’s tyre business, Goenka said RPG would invest Rs700 crore to set up a plant in Gujarat. But he declined to divulge details of the plant’s total capacity.