Tamil Nadu-based tea retail chain Chai Kings raises $3 million for further expansion

Chai Kings, a Tamil Nadu-based new-age tea retail chain, has raised $3 million (about Rs 24 crore) in a Series A funding round led by A.V. Thomas and Co. (AVT).

Prior to this round, the startup raised $1 million in a Seed funding round led by The Chennai Angels, Hyderabad Angels, and TiE Angels. 

Chai Kings' market presence

Founded in 2016 by Jahabar Sadique and Balaji Sadagopan, Chai Kings offers a diverse range of tea blends, from classics like masala and ginger chai to exotic options like saffron chai and Kashmiri Kahwa.

The startup's menu also includes black, herbal, green, and iced teas, along with bubble tea, hot and cold chocolates, and milkshakes.

“At Chai Kings, our mission has always been to bring high-quality and affordable chai to every corner of the country. With AVT’s support, we are confident that we can expand at an even faster pace while maintaining the superior quality and service that our customers love," said Balaji Sadagopan, COO of Chai Kings.

Aiming for expansion

Chai Kings plans to use the funds to expand its footprint, strengthen its supply chain, and enhance customer engagement through digital platforms.

“We are thrilled to welcome A.V. Thomas and Co. as our investor and partner in this journey. Their deep-rooted expertise in the tea industry aligns perfectly with our vision of serving premium chai experiences at an affordable cost across India,” said Jahabar Sadique, Co-Founder and CEO of Chai Kings. 

“This funding will enable us to scale our operations, open new stores, innovate our offerings and bring our unique chai experience to an even larger audience across India,” he added.

Aiming to open 65 more outlets

Chai Kings aims to open 65 more outlets in Chennai, Bengaluru, Hyderabad, and Coimbatore. The brand currently operates 57 stores in Chennai, Hyderabad, and Coimbatore. 

The chain derives nearly 45% of its revenue from food delivery platforms and has joined Swiggy’s 10-minute delivery service, Bolt, for select menu items. 

It currently posts monthly revenues of around Rs 4-4.5 crore and expects to double that figure over the next two years. It also projects a revenue of Rs 48 crore in fiscal 2025, with a positive EBITDA.

“Chai Kings has built a strong brand and loyal customer base. We see tremendous potential in their growth trajectory and are excited to be a part of their journey,” said Ajit Thomas, Executive Chairman of AVT.