Costa Coffee India reset underway as master franchisee bets big on Gen Z

The UK-based coffee chain has closed two dozen stores in India over the last 12 months as it reshapes its strategy to capture Gen Z footfall

After successive years of steady outlet growth in India, in 2025 Costa Coffee reported its first annual net store contraction in the country since the start of the pandemic.

In March 2026, Gurugram-based master franchisee Devyani International Ltd (DIL) announced it was “resetting” its growth strategy to improve like-for-like sales and store profitability across its sizeable F&B network, which also includes hundreds of licensed KFC and Pizza Hut restaurants.

For Costa, that reset has meant doubling down on its core target audience, Gen Z, and recasting itself as a lifestyle-centric brand.