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Sri Lankan tea major Dilmah is investing USD 1 million in India to establish a premium tea business with luxury hospitality as its first major market. Over the past 14 months, the company has developed Thambapanni, an India-specific collection made with tea, herbs and spices sourced from 26 Indian growers and packed locally. Dilmah plans to work with luxury hotels and hospitality operators before expanding the brand into direct-to-consumer, quick-commerce and e-commerce channels. The company also plans to introduce Dilmah Urban Estate tea lounges as part of its longer-term retail strategy. A new manufacturing plant in Coimbatore is expected to begin supporting exports from 2028. Dilmah, which operates in 108 countries, aims to make India one of its top 10 global markets within the next decade.
Sri Lankan tea major Dilmah is investing USD 1 million in India to build a premium tea business centred initially on the country’s luxury hospitality sector, as the company seeks to establish India among its top 10 global markets within the next decade.
The company has spent the past 14 months developing its India strategy and has launched Thambapanni, a premium tea collection created specifically for the Indian market. The collection uses tea, herbs and spices sourced from 26 Indian growers and is packed in India.
Dilmah chairman Dilhan C. Fernando said the company’s entry strategy would begin with luxury hospitality, before extending to direct-to-consumer, quick-commerce and e-commerce channels. The company also plans to eventually establish its own Dilmah Urban Estate tea lounges.
Luxury hotels and hospitality businesses are therefore expected to form the initial distribution and customer base for the India-specific collection. The strategy gives Dilmah a presence in the premium hospitality segment before the brand expands its consumer-facing channels.
The focus on luxury hospitality also forms part of the company’s wider premium positioning in India. Rather than launching simultaneously across mass-market retail channels, Dilmah is initially targeting hospitality establishments where premium tea offerings can be integrated into hotel food and beverage operations and guest experiences.
The company currently operates across 108 countries and sees India as an increasingly important market for its international business. Dilmah expects India to enter its top 10 global markets within 10 years as the local operation expands.
Alongside its hospitality push, Dilmah is planning a new manufacturing plant in Coimbatore. The facility is expected to support the company’s export operations from 2028, giving India a role in both the domestic premium tea business and the company’s wider international supply chain.
The manufacturing investment is part of Dilmah’s longer-term India strategy, while the immediate expansion is focused on establishing Thambapanni within the luxury hospitality segment. The company will subsequently widen its reach through online commerce and direct consumer sales, followed by the planned Dilmah Urban Estate tea lounges.
With luxury hospitality positioned as the first route to market, Dilmah is using its India-specific premium collection to build relationships within the high-end hotel sector before broadening its distribution footprint. The company’s USD 1 million investment over the past 14 months, planned Coimbatore manufacturing facility and multi-channel expansion strategy underpin its target of making India one of its 10 largest global markets over the coming decade.
Source: Dilmah Tea
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