What is a instant tea project report?
An instant tea project report is a detailed project report (DPR) for a plant that extracts black tea with hot water, concentrates the liquor and spray dries it into a soluble powder. It sets out the process, machinery, tea sourcing, licences, project cost, means of finance, five-year projections, DSCR and break-even that a lender checks.
Promoters use it to size the plant and raise a term loan or subsidy; banks and investors use it to judge whether the unit can repay.
Also known as: project report on instant tea, instant tea business plan, instant tea powder plant project report, soluble tea manufacturing DPR.
What a bank checks in an instant tea project report
An instant tea plant turns cheap tea grades into a higher-value powder, but the margin between tea cost and powder price is narrow. Lenders test these four numbers first. The values are from our sample report.
It takes several kilos of tea to make one kilo of powder. A report showing a much lower share has usually assumed an extraction yield the plant will not reach.
CTC fannings and dust are the main feed. Their auction price moves with the crop season, so banks look for a price rise test on this one input.
Instant tea absorbs moisture from the air. Foil bags and lined cartons cost more than ordinary packing, and leaving them out flatters profit.
The debt service coverage ratio shows how many times cash earnings cover loan instalments. Banks look at the weakest year, not only the average of 1.63.
Values are the assumptions in our illustrative sample. Your report uses figures for your capacity, tea sources and buyers.
How much does an instant tea plant cost in India?
Cost depends mostly on the size of the spray dryer and evaporator, which set daily output. The middle tier is the unit modelled in our sample report; the other two are indicative ranges.
Pilot unit
₹70–110 lakh
About 100 kg per day, batch extraction
- Machinery₹35–55 lakh
- Shed and utilities (or rent)₹15–30 lakh
- Working capital margin₹8–15 lakh
Term loan; PMFME subsidy where eligible
Small plant
₹152.83 lakh
250 kg per day, 75,000 kg per year
- Plant and machinery₹73.88 lakh
- Building and civil works₹29.55 lakh
- Working capital margin₹18.49 lakh
Term loan ₹115 lakh (75%), promoter ₹38 lakh
Larger plant
₹8–15 crore
About 1–2 MT per day, continuous extraction
- Machinery₹4–8 crore
- Land and building₹1.5–3 crore
- Working capital margin₹1–2 crore
MSME term loan, often with CGTMSE cover
Pilot and larger plant ranges are indicative. Costs vary with stainless steel grade, freeze or spray drying, automation and location.
Instant tea manufacturing process
The plant works like a small tea brewery joined to a milk powder dryer. Every step aims to keep flavour and colour while removing nearly all of the water.
- Tea selection and blending
Fannings and dust are bought on liquor strength and colour, then blended so each batch gives the same cup.
- Hot water extraction
Soft water at about 85–95 °C passes through the tea in extraction columns and dissolves the soluble solids.
- Clarification
A decanter centrifuge removes spent leaf and a clarifier takes out fines, so the extract is clear.
- Aroma recovery
Volatile aroma is stripped with steam or inert gas, condensed and kept aside to add back later.
- Cream removal
For cold-soluble grades the extract is chilled so tannin-caffeine cream settles out and the powder dissolves clear in cold water.
- Vacuum concentration
A falling film evaporator boils off water at low temperature until the extract reaches about 40–45% solids.
- Spray drying
The concentrate, with aroma added back, is sprayed into hot air and dries to a powder of 3–5% moisture.
- Sieving and packing
Powder is sieved and packed in a dehumidified room in foil bags or lined cartons, because it picks up moisture from humid air.
Raw material for instant tea: which tea grades to buy
Plants use the lower-priced grades. CTC fannings and dust give strong colour and quick extraction, and some orthodox broken grades are blended in for flavour. Plants near tea gardens can also use fermented undried leaf, which skips the auction and costs less.
| Raw material | Share of cost | Year 3 (₹ lakh) |
|---|---|---|
| CTC black tea fannings and dust | 78% | 289.55 |
| Orthodox broken and leafy grades | 14% | 51.97 |
| Food-grade processing aids | 5% | 18.56 |
| Filter aids and consumables | 3% | 11.14 |
| Total | 100% | 371.22 |
Spent leaf left after extraction can be sold as fuel or compost feed, which offsets a small part of tea cost.
Machinery for an instant tea plant
Most of the line is food-grade stainless steel. The spray dryer is the largest single item in our sample report, followed by the extraction columns and evaporator.
| Machine | What it does | Sample cost (₹ lakh) |
|---|---|---|
| Hot water extraction columns | Dissolve soluble solids from the tea | 13.30 |
| Decanter centrifuge and clarifier | Remove spent leaf and fines | 8.87 |
| Aroma recovery unit | Captures aroma for adding back | 4.43 |
| Falling film vacuum evaporator | Concentrates extract to 40–45% solids | 13.30 |
| Spray dryer with cyclone and bag filter | Dries concentrate to powder and collects fines | 20.69 |
| Dehumidified powder filling system | Packs powder without moisture pick-up | 5.91 |
| Steam boiler | Heats water and the evaporator | 4.43 |
| Water treatment plant | Softens water so extract stays clear | 2.95 |
| Total plant and machinery | 73.88 | |
Costs are the sample report's estimates for a 250 kg per day line. Get current quotations before you finalise.
Who buys instant tea in India and abroad?
Instant tea is mainly a business-to-business product. Most of it goes into iced tea, ready-to-drink tea, tea premix and vending blends, and exporters ship it to overseas beverage companies. Buyers approve a supplier on samples and then expect the same solubility, colour and taste in every lot.
- Iced tea and ready-to-drink beverage makers
- Tea premix and vending blend packers
- Retail instant tea and lemon tea brands
- Exporters and overseas beverage companies
- Food and flavour manufacturers
Hot or cold soluble decides your buyer: premix and vending packers want hot-soluble powder, while iced tea makers need cold-soluble grades that stay clear. Pick the grade before you size the plant, because cold-soluble needs the extra cream removal step.
Licences and standards for an instant tea unit
Instant tea sits under both the food regulator and the Tea Board. These were checked against official sources in October 2026.
| Tea Board registration | The Tea (Marketing) Control Order treats instant tea makers as tea manufacturers. Register with the Tea Board and file the monthly instant tea return |
|---|---|
| Tea Waste licence | Needed from the Tea Board under the Tea Waste (Control) Order if you buy or use tea waste as raw material |
| FSSAI licence | A state licence for general processing units of more than 100 kg and up to 2 MT per day; a central licence above 2 MT per day or for 100% export units |
| FSSAI product standard | Instant tea in solid form: moisture not more than 6%, total ash not more than 20% (hot soluble) or 35% (cold soluble), acid-insoluble ash not more than 1% |
| Flavoured instant tea | Makers must register with the Tea Board before marketing and print the registration number on the label |
| Other approvals | Udyam and GST registration, State Pollution Control Board consent, factory licence and Legal Metrology registration for retail packs |
Loans and schemes for an instant tea plant
Most instant tea plants cost more than the small-unit schemes allow, so a bank term loan is the usual route. Subsidy schemes help mainly at pilot scale.
PMFME
35% subsidy, up to ₹10 lakhCredit-linked capital subsidy for micro food processing units, with 10% own contribution. Suits a pilot instant tea unit.
PMEGP
Manufacturing projects up to ₹50 lakhMargin-money subsidy of 15–35% for new units. Fits only a very small first unit.
MSME term loan with CGTMSE
Plants like our sample and largerCollateral-free guarantee cover for eligible micro and small enterprises, alongside a cash credit limit for tea stock.
Scheme limits change. Confirm current terms with the bank or the scheme portal before applying.
Mistakes that weaken an instant tea project report
- Over-stating extraction yield
Hot water recovers only about a quarter to a third of the tea as solids. Assuming more cuts tea cost on paper and makes the DSCR look stronger than it will be.
- No dehumidified packing room
The powder cakes once it picks up moisture, and the FSSAI limit is 6%. Without a dry room and foil packing, lots get rejected.
- Under-costing steam and power
The evaporator and spray dryer use most of the energy. Check the fuel figure against boiler and dryer quotations, not a general food plant ratio.
- Planning one grade for every buyer
Hot-soluble and cold-soluble powders need different processing. A report that promises both without the cream removal step will fail buyer trials.
- Leaving out the Tea Board
The Tea (Marketing) Control Order requires instant tea makers to register. Plan it, and the Tea Waste licence if needed, into the start-up timeline.
How NPCS helps you set up an instant tea plant
- Grade and capacityChoose hot or cold soluble grades and a daily output that matches your buyers and tea supply.
- Process and machineryCompare extraction, evaporation and drying options and get supplier quotations.
- Bank-ready project reportYield-based tea costing, projections, DSCR and working capital in your lender's format.
- Approvals and layoutTea Board, FSSAI and pollution approvals, with a hygienic plant layout and dry packing zone.
NPCS's client list includes 2 assignments for instant tea and 6 across tea and coffee processing. The NPCS project team, led by founder Ajay Kumar Gupta, has prepared project reports for entrepreneurs, banks and companies since 1994.
What's inside the instant tea sample report
- Introduction
- Uses and applications
- Market potential
- Manufacturing process
- Raw materials
- Plant and machinery
- Land, building and utilities
- Manpower
- Licences and approvals
- Project cost and means of finance
- Working capital
- Projected profitability
- Cash flow statement
- Projected balance sheet
- Depreciation
- Term loan repayment
- Debt service coverage
- Break-even analysis
- Financial ratios
- Key assumptions
- Conclusion
- Monthly loan repayment schedule
19 pages, five-year projections, illustrative figures.
Open sample reportFree sample or a report for your project?
| What you get | Free sample | NPCS report for your project |
|---|---|---|
| Capacity and location | Typical unit | Your capacity, site and state |
| Figures | Illustrative | Built on current prices and quotations |
| Machinery suppliers and quotations | No | Yes |
| Market survey for your region | No | Yes |
| Bank or scheme format (PMEGP, term loan) | No | Yes |
| Use for a loan application | No | Yes |
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Instant Tea project report: frequently asked questions
What is the instant tea manufacturing plant cost in India?
A pilot unit of about 100 kg per day needs roughly ₹70–110 lakh, and a 1–2 MT per day plant about ₹8–15 crore, both indicative. Our sample report models a 250 kg per day unit at ₹152.83 lakh, with plant and machinery of ₹73.88 lakh. The spray dryer and evaporator decide most of the machinery cost, so get quotations for your capacity.
How is instant tea made?
Tea is extracted with hot water, clarified to remove spent leaf, stripped of aroma, concentrated under vacuum to about 40–45% solids and spray dried into powder. The aroma is added back before drying. For cold-soluble grades the extract is also chilled to remove tea cream. The powder is then sieved and packed in a low-humidity room.
How much tea is needed to make 1 kg of instant tea?
Usually about 3–4 kg of tea, because hot water extraction recovers roughly a quarter to a third of the leaf as soluble solids. The exact figure depends on the tea grade, extraction temperature and how many passes you run. This yield is the biggest number in the costing, since tea is most of the raw material bill.
Is instant tea the same as tea premix?
No. Instant tea is pure dried tea extract with no milk or sugar. A tea premix blends instant tea with milk powder, sugar and sometimes spices. Many premix packers buy instant tea from a specialist plant rather than make it, which is why premix and vending blend makers are among the main buyers of an instant tea unit.
Is an instant tea business profitable?
In our illustrative sample, a 250 kg per day unit earns sales of ₹603.75 lakh and net profit of ₹28.99 lakh in Year 3, with break-even at about 48% of capacity and payback in about 4 years. Margins are thin because raw material is 61.5% of sales, so tea buying and extraction yield decide profit.
Do I need Tea Board registration for an instant tea unit?
Yes. The Tea (Marketing) Control Order counts instant tea makers as tea manufacturers, so the unit must register with the Tea Board and file monthly returns. A Tea Waste licence is needed if you use tea waste, and flavoured instant tea makers must register with the Tea Board before marketing, along with the FSSAI licence.
Is the instant tea project report PDF free, and can I use it for a loan?
The sample is free to view and download. It is an illustrative report that shows the format and depth of an NPCS report; its figures are representative and not based on a real project, so it should not be submitted to a bank. For a loan, NPCS prepares a report for your own capacity, location and loan scheme.
Sources and references
- Food Safety and Standards (Food Products Standards) Regulations, Chapter 2.10: Beverages (instant tea in solid form)Food Safety and Standards Authority of India, checked Oct 2026
- Tea (Marketing) Control Order, 2003, updated up to 2024Tea Board India, checked Oct 2026
- Eligibility and applicability criteria for FSSAI registration and licenceFood Safety and Standards Authority of India, checked Oct 2026
- Tea processing (PMFME training material, includes instant tea)NIFTEM, Ministry of Food Processing Industries, checked Oct 2026
- Instant teaUPASI Tea Research Foundation, checked Oct 2026
- PMFME scheme for micro food processing enterprisesDistrict Administration Khordha, Government of Odisha, checked Oct 2026
- Prime Minister's Employment Generation Programme (PMEGP)MSME Department, Government of Uttar Pradesh, checked Oct 2026
- Credit Guarantee Scheme for Micro and Small Enterprises (CGTMSE)Directorate of Industries, Trade and Commerce, Government of Goa, checked Oct 2026
The NPCS project team, led by Ajay Kumar Gupta
This page and its sample report are prepared and reviewed by the NPCS project team, which has written techno-economic feasibility studies and detailed project reports since 1994.
Ajay Kumar Gupta founded Niir Project Consultancy Services (NPCS) and leads the organisation. With 40 years of experience in MSME project consulting, he has built the team that has delivered more than 28,000 project reports for clients worldwide, helping entrepreneurs plan and finance profitable manufacturing businesses.
- Published
- Last updated
- Next review
- Oct 2027
- Reviewed by
- NPCS project team
This page is reviewed every 12 months, or sooner when scheme limits, GST rates, BIS rules or pollution categories change. The sample report is illustrative: its figures are generated from industry-typical ratios for a unit of this size, checked so every statement balances, and are not taken from any client project.