Bengaluru-based tea restaurant chain Chai Point plans to launch an initial public offering in the next 18 to 24 months. It is banking on its brewing system to open new partnerships amid growing market competition, with more participation.

“Over the past year and a half, we have invested heavily in technology, building brewing machines while increasing profitability. Our goal is to take the company public in about 18 to 24 months,” said Chai Point’s co-founder, Founder and CEO Amuleek Singh Bijral.

For the past few years, the chain has focused on making its brewing machines. It has so far installed 5,000 machines across 19 cities in the country through its business-to-business-to-consumer (B2B2C) channel. Founded in 2010, the company operates 180 retail stores in nine cities.

In addition to retail stores, Chai Point now has a diverse customer base divided into corporate and third-party retail stores. It also sells packaged goods individually through the marketplace and its stores.

For third-party retail stores, it provides them with the “My Chai Corner” brand, rental machines and their processes, and consumables purchased by third-party stores through the Chai Point’s platform. Bijral said this would help expand their footprint while controlling quality, with all third-party stores under My Chai Corner consolidated into one app.

When asked how the brewing system differs from many coffee machines seen in offices, the CEO said that these machines come with Android software that allows the consumer to customise the profile of the side the consumer likes her/her cup of tea and then save for future use to ensure consistency.

These machines are also deployed at Intel, Microsoft, VMware and Amazon. Currently, corporate contributes about 40% of the business, compared with 57% for retail.

Consumption in Mumbai, Chennai and Delhi has returned to pre-COVID levels, Bijral added. In Bengaluru, tech parks and other areas have not recovered to their original level. However, Bengaluru remains the largest market for Chai Point, followed by NCR.

While Chai Point has also entered the coffee market, offering filter coffee and bean-to-cup products, Bijral said that while there are competitors in various product lines, no single player is comprehensive.

Looking at it another way, in terms of storefronts, Chai Point currently competes in the retail space with the likes of Chaayos, Starbucks, Cafe Coffee Day and Hatti Kaapi, as well as smaller independent players. On the corporate side, it’s competing with Coffee Day and Lavazza as they deploy machines in corporate offices.

Chai Point has raised about $55 million from investors, including Saama Capital and Eight Roads Ventures. Chai Point’s latest financials were for FY21 when the pandemic impacted business. For FY21, its loss jumped to Rs 78.5 crore from Rs 47.7 crore in FY20, while operating income fell to Rs 55.7 crore from Rs 189 crore in the previous year.