Beverages giant Coca-Cola plans to more than double its investments in India over the next decade.
The beverages major will pump in $5 billion (around Rs 28,500 crore) over the next ten years as it ramps up capacities in India, which is likely to be the world’s largest youth market by 2020.
Since its entry into India in 1993, when it acquired Parle’s soft drinks brands Thums Up and Limca, Coca-Cola has invested close to $2 billion.
The company operates on a “hybrid model” in India, running a mix of owned and franchisee-operated bottling plants.
Announcing the investment scale-up in New Delhi on Tuesday, Coca-Cola’s global Chairman and Chief Executive Officer, Mr Muhtar Kent, said India had “near limitless growth potential.”
The revised investment is “more than twice” the previously announced $2 billion for India, Mr Kent said.
Coca-Cola expects India to be among its top five markets worldwide by 2020, Mr Kent said, adding that the India story was one of “remarkable turnaround.”
Six years back, Coca-Cola had hit the nadir in India, with growth plunging and the company’s flagship brand buffeted by the pesticide controversy.
Mr Kent declined to reveal whether the new investments will result in a change in its product mix, away from flavoured, carbonated water to more of juices and other ‘healthier’ beverages.
But that shifts appears unlikely.
Mr Kent underscored the low per-capita consumption in India — an average of 12 units a year, or a bottle a month — in contrast to China’s per-capita average of 38 and Coke’s global average of 92 units.
Observers who track the sector closely said the company, unless compelled by legislation, is unlikely to look at diversifying the mix until consumption reaches close to the global per-capita average .
Coca-Cola India President Mr Atul Singh said sales in India grew at over 20 per cent last year.