Coca-Cola Chairman and CEO Muhtar Kent on Tuesday announced that the world’s largest beverage company and its partners would invest $5 billion (about Rs 28,000 crore) in India over eight years to set up new bottling plants and enhance operations across its value chain.
The company hopes the investment would help India scale up from being the seventh largest market for the beverages giant to number five in a few years. Since it re-entered the country in 1993, Coca-Cola has already invested $2 billion and, Kent says, has come a long way from being ranked number 16 in the global pecking order in volumes in 2005-06.
Kent has come to India after four years and it is his first visit since he took over as CEO in July 2008. However, his Delhi connection dates back to the 60s, when he studied here as a boy and his father was an official in the Turkish embassy. “We plan to invest $5 billion in India between now and 2020. Why are we increasing it? Because we are absolutely confident this is the right decision considering the vast opportunities in India. In the last 10 years, we have invested $1.4 billion. Now, we are trebling that investment in the next eight years,” Kent said. The investment, one of the largest committed in the FMCG sector in the country, is significant as Coca-Cola Company will invest $30 billion globally in five years to double revenues. PepsiCo, on the other hand, was in 2010 reportedly looking at investing $500 million in two years. It had completed its $500-million investment for three years announced in 2008 a year ahead of schedule.
Asking other multinationals to judge India by its potential, Kent said, “I invite all large businesses in the world to come and invest in India because it has a wonderful, great future.” “We see a very great bright future for India and for Indian business and we believe there are many others who will see there is potential here,” he said.
The India investment is in line with Coca-Cola’s plans to double revenues globally to $200 billion by 2020. In 2011, the company had grown five per cent to record sales of 27 billion cases globally. While volumes of sparkling beverages grew four cent, those of still beverage (juices, juice drinks, tea, coffee, sports drinks and water) increased eight per cent.
