The Coca-Cola Company (NYSE: KO) said it will invest $2 billion in India over the next five years in an attempt to boost its market share in one of the most populous nations on earth.
The U.S.-based soft-drink maker said part of its cash outlay will be devoted to increasing manufacturing capacity and to expand its distribution network in India. By 2020, Coke expects India to be one of its top five markets (it is currently in the top ten).
According to reports, the $2-billion expenditure would be equal to the amount Coke has invested in India over the past 18 years.
This investment is a part of our long-term commitment to invest in innovation, partnerships and a portfolio of brands that will enable us to grow our business in a sustainable and responsible way, said Atul Singh, president of Coca-Cola India, in a statement.
The country's demographics, economic and social parameters are all huge drivers of growth and we have to ensure that we capitalize on the opportunity.”
BBC reported that due to India’s rising middle-class and larger number of affluent consumers, Coke has enjoyed double-digit growth in India in 15 of the last 21 quarters.
Ahmet C. Bozer, Coca-Cola's president, Eurasia and Africa Group, told reporters about India’s vast potential.
India is one of our most important growth markets as we work toward our 2020 vision of doubling system revenues and servings this decade, he said.
If we continue to do the right things each day and at all times, it would not surprise me if India becomes one of the top five markets for the company globally by the end of this decade.”
Coke, which re-entered the Indian market in 1993 after a sixteen year hiatus -- directly employs more than 25,000 workers in India.
While Coke dominated market share in the U.S. -- 42 percent in 2010, versus 29.3 percent for rival PepsiCo (NYSE: PEP) – most of its revenues are being generated in foreign markets.