Coca-Cola plans $250-million expansion in India

21 August, 2007:

Coca-Cola plans to invest $250 million in India over the next three years, introduce new products, and add additional lines of bottling capacity.

The amount would be utilized to streamline bottling operations, enhance infrastructure such as coolers and bottling lines, invest in sales, equipment, trucks and other distribution related materials, as well as expand its product portfolio by entering new segments.

Coca-Cola will set up a retail university in India and an equipment testing facility in Hyderabad, company officials said at a news conference.

Atul Singh, chief executive officer of Coca-Cola India, said “These investments would enable the Coca-Cola system to create bottling capacities for new product offerings, execute marketing strategies, devise innovative distribution models, and ensure value creation for all its business partners.”

“In the past four consecutive quarters,” he added, “we have delivered good growth, with the last quarter clocking 12% in India. To enhance it further, our new initiative will follow a five-point strategy involving people, planet, portfolio, partners, and performance.”

Sparkling beverages, energy drinks, sports drinks, flavored water, and juices in localized flavors are the new areas that Coca-Cola will focus on.

Atul Singh said the company was also open to synergistic local acquisitions and was studying if the Indian market was ready for energy drinks major Glaceau’s brands, which it recently acquired for $4.1 billion.

Coca-Cola unveiled a new logo on August 17, 2007. The new corporate logo, Little drops of joy, is aimed at presenting a more humane face of the company, which has been ridden by controversies in the past few years.

The campaign, an Indian adaptation of the Coca-Cola Company’s recently unveiled global campaign, is an initiative to connect with shareholders, the company said. Also planned is a national launch of the company’s orange pulp drink called Minute Maid.

Most of the items included in the portfolio expansion in India would be developed in India itself. Globally, Coca-Cola has 400 brands and over 1,000 products.

The company has already test-marketed Maaza Aam Pana and the “bolder tasting” Fanta in some parts of India. These might also be rolled out nationally.