chaayos: Alpha Wave leads $45 million investment in Chaayos parent firm

Mumbai: Sunshine Teahouse Pvt. Ltd., the parent company of Chaayos, has raised $45 million as part of its Series C funding round led by Alpha Wave Capital, according to the company’s filings sourced through Tofler.

According to the documents, the company is being valued at $250 million. The current funding round also saw participation from Chaayos’ other backers such as Tiger Global, Elevation Capital and Think Investments. Alpha Wave invested Rs 207.6 crore in the latest round.

In February 2020, the company had raised $21.5 million from investors led by Think Investments.

In its extraordinary general meeting on June 7, the company’s board passed a special resolution to allot 13,89,756 Series C preference shares at issue price of Rs 2,514 per share to raise Rs 349 crore ($45 million), the filings showed.

Founded in 2012 by Nitin Saluja and Raghav Verma, Chaayos is a chain of tea cafes spread across New Delhi, NCR, Mumbai and Bengaluru. Its around 150 outlets offer dine-in and takeaway. The company previously said it was looking at expanding its offline presence to as many as 300 outlets across new geographies.

Chaayos competes with Chai Point, backed by Eight Roads and Saama Capital, and other tea cafes.

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According to Chaayos’ filings, it revenues dropped 44.8% to Rs 54.85 crore for the financial year ending March 31, 2021 from Rs 99.4 crore in FY20. The company’s losses widened to Rs 52.06 crore in FY21 from Rs 51.14 crore in the previous fiscal year.

The company has been hit hard by the pandemic and found it difficult to scale up. However, it has seen strong growth traction of late, a source said. “The post-pandemic recovery has been good, and the company plans to add new categories and serve more people through its line of packaged foods in retail stores and cafés,” the source added.

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