The creditors to Coffee Day Enterprises Ltd (CDEL), which owns and operates the Cafe Coffee Day chain, may send the company to the National Company Law Tribunal (NCLT) for debt settlement following the firm's announcement that it had defaulted on its loans in the March 2021 quarter, Business Standard reported on Thursday.

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According to CDEL's exchange filing for the March quarter, the company's outstanding debt stood at Rs 280 crore, it said. The liquidity crisis, the company said, was the reason behind the delay in payments. Its total debts stand at Rs 518 crore, the CDEL said.

In July 2020, the company announced the shutdown of 280 outlets in the first quarter of that fiscal year due to profitability issues and an anticipated increase in future expenses. Following these closures, the number of outlets stood at 1,480 as of June 30 last year, according to a PTI report in Mint.

Earlier this year, the homegrown care retail chain entered what was referred to as the "strategic alliance" with Premium waffle brand London Bubble Co (LBC). As a part of the alliance, the LBC will open 150 shop-in-shops in CCD, an attempt towards generating incremental revenue even as the pressure to repay debts mounted.

This shop-in-shop business model with CCD will also help the LBC expand its footprint in India. The LBC-CDEL partnership was said to be the largest of its kind in the country.

Besides the cafe chain, the CDEL is also said to be one of the largest exporters of green coffee in India. They have been involved in the export business since 1999 and their products go to the Middle East, Europe, and Japan.

First Published:Apr 8, 2021 1:21 PM IST