Coffee Day Enterprises Limited

Consumer Cyclical — Restaurants · NSE

₹30.65+₹0.67 (+2.23%)

DalalBaazaar Score

64 / 100

🟢 Good

Verdict

NEUTRAL

Risk

Low

Driven by micro-cap size, which brings thin liquidity, falling profits.

In simple words: The business is earning a fairly low return on the money invested in it, though profits are falling even as sales grow. The direction of profits is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:02 pm

Understanding the Business

Company site ↗

The 60-second version of Coffee Day Enterprises Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Coffee Day Enterprises Limited, together with its subsidiaries, primarily operates Café Coffee Day outlets in India, Europe, and internationally. It operates through Coffee and Related Business, and Hospitality services segments.

IndustryRestaurants

SectorConsumer Cyclical

Employees148

Annual revenue₹1,110 Cr

How does it make money?

Turns over ₹1,110 Cr a year. Of every ₹100 of sales, about ₹18 reaches shareholders as profit, with ₹16 left at the operating level before interest, tax and depreciation. Each of its 148 employees supports ₹7.50 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹7.50 Cr

Who are its competitors?

The closest listed comparisons in its industry are MARUTI SUZUKI INDIA LTD., TITAN COMPANY LIMITED, TRENT LTD, AVENUE SUPERMARTS LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 7.8% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE25.9%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +21% while net margin moved -144% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+21%

Margin effect-144%

DalalBaazaar Score

64/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 6.6% — barely ahead of inflation
✗ Profit fell 97.0% in the latest year

Quality vs. Valuation

Company Quality

62/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

80/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

3.7x

Sector Median

69.2x

median of 4 sector peers

🟢Against its sector it trades 95% below the peer median of 69.2x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

69.2x median of 4 peers · -95%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

8.2x

PEG

—

What's Good / What's Bad

🟢 What's Going Well4

Debt is being paid down
Total debt is down 55% over 3 years.
Return on equity is rising
ROE has improved from -11.8% to 7.3%.
Return on capital is rising
ROCE has improved from -8.2% to 7.8%.
Very low debt
Debt/Equity of 0.26x leaves the balance sheet with plenty of headroom.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

2 items require attention · 2 high

🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 7.2 points, from 23.1% to 15.9%.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 55% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 95% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹146 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 23.1% to 15.9%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
The debt load needs earnings to hold up
Debt is 4.7x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Growth barely outpaces inflation
Revenue compounding at 6.6% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 14%✓ 15.9%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 4.7x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Interest cover stays above 3x✓ 3.5x
How much operating profit can fall before interest stops being comfortably covered.
4Revenue growth stays above 5% a year✓ 6.6% CAGR
Latest reported year was 7.6%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5Free cash flow remains positive✓ ₹146 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

7 / 11 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✗ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 3 neutral · 3 weak

Market Cap

₹647 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

3.7x

Cheap

Cheap against the generic band

P/B Ratio

0.23x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹8.32

Profitable

Profitable on a per-share basis

ROE

7.3%

Weak

Weak capital efficiency

ROCE

7.8%

Weak

Low return on total capital employed

Debt/Equity

0.26x

Low

Conservative leverage

Revenue Growth (YoY)

7.6%

Modest

Modest growth

Profit Growth (YoY)

-97.0%

Falling

Profits are shrinking

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

₹146 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

3.1x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

6.5%

Average

Average margins

Net Margin

15.5%

Good

Strong bottom-line conversion

Current Ratio

3.53

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.59

Defensive

Steadier than the market

52W Range Position

41%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

30.5 / 30.6

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

53.4

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹916 Cr	₹1,007 Cr	₹1,070 Cr	₹1,110 Cr	+6.6%
EBITDA	₹212 Cr	₹174 Cr	₹155 Cr	₹176 Cr	-5.9%
EBITDA Margin	23.1%	17.3%	14.5%	15.9%	—
PAT (Net Profit)	-₹380 Cr	-₹323 Cr	-₹58 Cr	₹203 Cr	—
EPS	₹-17.98	₹-15.27	₹-2.75	₹9.61	—
ROE	-11.8%	-11.3%	-2.2%	7.3%	—
ROCE	-8.2%	-10.3%	2.4%	7.8%	—
Total Debt	₹1,840 Cr	₹1,363 Cr	₹1,373 Cr	₹827 Cr	-23.4%
Free Cash Flow	₹172 Cr	₹189 Cr	₹162 Cr	₹146 Cr	-5.3%

🟢 Revenue has grown at 6.6% a year over 3 years.

🔴 EBITDA has shrunk at 5.9% a year over 3 years.

🔴 EBITDA Margin has fallen from 23.1% to 15.9% over 3 years (-7.2 pts).

🟢 PAT (Net Profit) has turned positive, from -₹380 Cr to ₹203 Cr.

🟢 EPS has turned positive, from ₹-17.98 to ₹9.61.

🟢 ROE has risen from -11.8% to 7.3% over 3 years (+19.1 pts).

🟢 ROCE has risen from -8.2% to 7.8% over 3 years (+16.0 pts).

🟢 Total Debt has shrunk at 23.4% a year over 3 years.

🔴 Free Cash Flow has shrunk at 5.3% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹4,538 Cr

Total Liabilities

₹1,381 Cr

Cash & Equivalents

₹26 Cr

Operating Cash Flow

₹172 Cr

Capex

-₹26 Cr

Shareholding (proxy)

Institutional Holding

0.2%

Insider Holding

16.0%

Peer Comparison

Company	P/E	ROE
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TITAN COMPANY LIMITED	68.5x	36.7%
TRENT LTD	87.2x	25.9%
AVENUE SUPERMARTS LIMITED	69.9x	12.7%

Recent News

1 positive1 mixed4 general

Coffee Day Enterprises (COFFEEDAY.NS) Slips 1.55% to ₹31.21, Testing Support Near ₹29.65 - Market Leader Picks

https://www.siam.in/, 13 Oct

Coffee Day Enterprises Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 30 Aug

Coffee Day Q1 Profit Plunges 81% to ₹4.5 Cr; Revenue Up 8%

HDFC Sky, 07 AugResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Coffee Day Enterprises Share Price Target 2026: Rs 41.3 Analyst Forecast

Univest, 19 JunAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

how Fair Value analysis spotted Coffee Day’s 64% upside By Investing.com

Investing.com India, 02 Jun

Coffee Day promoter Malavika Hegde releases 18,745 invoked shares

scanx.trade, 20 Aug

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Valuation

MiddlingProfitability

WeakGrowth · Risk

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 2 high-severity red flags sit above this conclusion and should be read first.

1 of 5 tripwires tripped — Debt / EBITDA falls below 3x · see Key things to watch ↑