Bucking Coffee's Dominance: Encalm's Move to Sell "India's Own Tea" at Delhi Airport

Encalm Hospitality, known for operating airport lounges in India, has launched a new business called "Encalm Eats" to bring together its food and beverage brands, opening its first venture — a café concept called "IndiSip" — at Delhi's international airport. Coffee is not the headline act. Instead, it's traditional drinks from across India: Kashmiri kahwa tea, ginger-cardamom tea, kesar (saffron) tea, and gulab (rose) tea. In an Indian dining market where coffee chains led by Starbucks are stepping up their offensive, the company is deliberately putting "India's own tea" front and center to go premium. This is worth reading, for Japanese companies involved in beverages, tea, and airport retail, as a real-world example of how to turn one's own domestic ingredients into value.

Source: A Major Airport Lounge Operator Now Has Its Own Tea Café Brand

Encalm is a major airport hospitality company that has operated multiple lounges centered on Terminals 1 and 3 of Delhi's international airport. Until now, its core business has been a "space-plus-operations" model, offering arriving and departing passengers a place to rest and eat. Encalm Eats is a step further along that same line, a move into building its own food and beverage brands.

The first venture, IndiSip, is a quick-service café built around the concept of "delivering India to travelers, one cup at a time." The menu centers on the regional teas mentioned above, alongside iced lattes, espresso, and shakes. Food ranges from distinctly Indian snacks — masala samosas, coconut kopra patties, Irani bun maska, achari paneer and chicken tikka wraps — paired with croissants, muffins, and cookies. Group CEO Vikas Sharma described Encalm Eats as "the next chapter that takes Encalm's hospitality business a step further," while business head Deepak Bhatia explained IndiSip as "the first step in a family of food and beverage brands to be expanded across multiple formats and locations."

What's New: Making "Domestic Tea," Not Coffee, the Star of the Store

India has long been one of the world's leading consumers of tea (chai), but street chai has for a long time held the position of a cheap, everyday drink. In the world of dining chains, meanwhile, coffee has grown over the past decade or so into "a premium drink urban youth are willing to pay for." The trend of Starbucks setting up premium Reserve-format stores in Delhi symbolizes this. What makes Encalm's choice interesting is that, rather than riding straight into that growing coffee side, it deliberately chose to elevate tea into "an experience worth paying for." Starbucks's premiumization strategy is covered in detail in a separate article, the Reserve format Starbucks launched in Delhi, but placing the two side by side makes clear the difference between two design philosophies: "premium brought in by a foreign brand" versus "premium built from one's own domestic ingredients."

Kahwa is tied to Kashmir, kesar tea to saffron, and gulab tea to rose — each is a drink carrying the story of a place or an ingredient. In middle-class and wealthier households, these are already recognized as "a slightly nicer tea." Encalm has turned that recognition into a product in the setting of an airport, a place where people linger and are more inclined to loosen their purse strings.

By the Numbers: The Tea Café Market Is Less Than a Third the Size of Coffee Cafés, but Growing Fast

According to an analysis by research firm The India Watch, India's chai café market is worth roughly 873 crore (8.73 billion rupees, about 15.7 billion yen at ₹1 ≈ ¥1.8), growing more than 15% over the past 12 months. The coffee café market, by comparison, is worth roughly 3,084 crore (30.84 billion rupees, about 55.5 billion yen), still more than three times larger. That said, the chai café side is said to have grown at roughly 20%-plus annually from FY21 to FY24, and is in a catch-up phase. The market is led by Chaayos and Chai Point, which together account for about 51% of sales, each operating more than 200 stores.

IndiSip's store size, pricing, and the terminal it operates in have not been officially disclosed, so this article does not include speculative figures. What is certain is the picture: an operator with local knowledge of airport retail has entered, with its own brand, a market where tea is winning on growth rate.

How the Industry Sees It: Three Perspectives

Summarizing the reactions of dining and airport retail industry figures, they can be grouped into roughly three views. The first is positive: an airport is the last touchpoint where travelers take home an "Indian memory," and tea, more than coffee, is easier to differentiate through its souvenir quality and storytelling. The second is cautious: an airport is a venue that earns money through turnover and average spend, and it remains unclear how a carefully brewed regional tea can coexist with the pace of operations. The third is structural expectation: if the passenger data and operational know-how accumulated through lounge operations can be repurposed for its own brand, the company could shift from a landlord attracting tenants to an operator earning revenue directly — a business transformation worth watching.

Implications for Japanese Companies: Designing a Translation of Domestic Ingredients into "Worth Paying For"

The core of this news lies less in the product itself than in the design of its positioning. There are three implications for Japanese companies, especially those involved in beverages, tea, and airport retail.

The first is a hint for selling "Japanese drinks" into India. Riding on coffee's dominance in India would just be a red ocean, but what Encalm has shown is a path of premiumizing an ingredient locals can take pride in. If Japan brings something to India, teas that carry a story and a ritual, like matcha, hojicha, or genmaicha, can more easily claim their own shelf without colliding head-on with coffee. There's also a path of adapting to local tastes, as with dairy drinks, and an example worth referencing is Calpis's entry into the Indian market The design of the entry point splits into two: bringing in your own ingredient, or premiumizing a local one.

The second is how to use an airport as a sales floor. Encalm turned its existing foothold in lounge operations into a testing ground for its own brand. For Japanese airport retail, duty-free, and beverage companies too, there's plenty of room to sell "Japan's regional teas and regional ingredients" with a story at Narita, Haneda, and Kansai, where inbound visitor numbers keep growing. The idea of turning a visitor's last cup before leaving Japan into a product can be imported directly.

The third is the procedure for premiumization. To lift a cheap, everyday item to a high price point requires a three-part story set: place of origin, ingredient name, and brewing method. Encalm handles the translation of kahwa into Kashmir, and kesar into saffron, right in the menu names. For Japanese tea, the concrete task becomes how to translate names like "Uji," "Yame," or "the roasted aroma of hojicha" into a single cup.

Ripple Effects on the Market: Lounge Operators Moving Downstream

This move can be read as one example of airport hospitality operators moving from renting out space toward owning their own brands. The shift from a model of attracting tenants and earning rent to one of holding a food and beverage brand and capturing gross margin directly is a point that resonates with Japanese operators of commercial facilities and station-area retail as well. Airport infrastructure in the Delhi capital region also continues to expand, and the new-airport developments are the opening of the new Noida airport as covered elsewhere. As the number of airports and passengers grows, in-house branding of airport F&B is likely to spread to other operators as well.

Practical Information: Where to Verify Details

IndiSip opened at Delhi's international airport (Indira Gandhi International Airport). The terminal it's located in, its hours, and its prices had not been officially compiled at the time of writing, so checking on the ground is the surest way to confirm. The locations and offerings of Encalm's lounge business are published on the company's website, and future store-opening plans for the F&B business will likely be added there as well. To keep track of trends in Indian dining and beverages on an ongoing basis, regularly monitoring local trade media — the primary source for store-opening news — is the quickest route.

Summary: What to Consider as the Next Move

Encalm's case is a textbook move in turning an ingredient into value: bucking a coffee-dominated market with your own domestic tea. Japanese companies have three concrete next actions available. First, if selling Japanese tea into India, design the product and choose partners on the premise of sitting next to the premium shelf of local tea, not next to coffee. Second, test, together with duty-free and airport retail companies, a plan to turn domestic regional teas and regional ingredients into a storied product for inbound visitors at the airport. Third, work out the translation of a story — place of origin, ingredient name, and brewing method — into a single cup, down to the level of the actual menu name. It's precisely because tea trails coffee by more than three times in market size that room remains to compete on growth rate and storytelling.

Sources

• Restaurant India: Encalm launches Encalm Eats, debuts IndiSip Café at Delhi Airport
• Business of Food: Encalm Eats debuts with in-house brand concept IndiSip Café at Delhi Airport
• The India Watch: Chai Point and Chaayos manage 51% of India’s tea café business