Last month, Coca-Cola said that it is selling its bottling plant in the north Gujarat region to Kandhari Global Beverages.
Though the company has not shared financial details, industry insiders have pegged the deal to be around Rs 2,000 crore, where Coca-Cola will transfer business from HCCBL, its bottling arm in India, to its bottling partner Kandhari Global Beverages.
The Atlanta-headquartered beverage major is divesting assets globally by franchising regional operations to local partners as part of its asset-light business model.
Kandhari Global Beverages Managing Director Varinder Pal Singh Kandhari told PTI that the company is ready for more bottling opportunities from Coca-Cola in India as well as foreign territories.
The Kandhari family-owned business entered in beverage business in 1967 and with eight bottling locations, the company has a capacity of 12,000 BPM (bottles per minute).
It has been associated with Coca-Cola since 1993 when the Atlanta-based firm re-entered India.
On its expansion in Gujarat, Kandhari said the Indian beverages segment is very dynamic and provides exciting opportunities.
“As part of the transaction, we are committed to making substantial investments in the business over the next decade, not only supply chain RTM (route to market) and sales execution but also in people, digitalisation and sustainability,” he said.
After the CCI’s approval, HCCBL will be left with 15 operational plants in India, where it produces beverages like Coca-Cola, Thums Up, Sprite, Minute Maid, Maaza, SmartWater, Kinley, Limca, and Fanta, among others.
In the December quarter, Coca-Cola divested a 40 per cent stake in HCCBL to the Bhartia family. Though the company has not disclosed the amount, some media reports have pegged it to be around Rs 10,000 crore.
In the March quarter of last year, it had franchised its bottling operations to its existing bottlers in three key markets — Rajasthan, Bihar, north-east, and parts of West Bengal — to its existing bottlers, earning USD 290 million (around Rs 2,420 crore).
Kandhari Global Beverages was one of the three existing bottlers to whom HCCB had transferred bottling operations of the Rajasthan market. It already operates in parts of Delhi, Himachal Pradesh, Haryana, Punjab, Chandigarh, Jammu & Kashmir, and Ladakh.
The two other existing partners were SLMG Beverages and Moon Beverages.
India is the fifth largest market of Coca-Cola.
HCCBL’s revenue in FY24 was Rs 14,021.54 crore and it recorded a net profit of Rs 2,808.31 crore, helped by the sale of bottling operations.
Source: Economic Times