The Coca-Cola Company, a leading global player in soft drinks, has generated USD 290 million (around INR 2,420 crore) from India in the March quarter through the strategic move of refranchising its bottling operations to its established bottlers in three significant markets. Earlier this year, in January, HCCB, Coca-Cola’s bottling arm in India, announced its decision to divest company-owned bottling operations in Rajasthan, Bihar, Northeast India, and certain regions of West Bengal to its current bottlers.
Coca-Cola stated in its earnings statement on Tuesday that during the three months ended March 29, 2024, the company reported net gains of USD 599 million and USD 293 million from the refranchising of its bottling operations in the Philippines and specific territories in India, respectively.
India stands as the fifth largest market for the Atlanta-based company, renowned for its brands such as Coca-Cola, Coke, Thums UP, Maaza, Sprite, Fanta, Minute Maid, and more, operating extensively within the nation.
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Hindustan Coca-Cola Beverages (HCCB) had delegated bottling operations to its current partners in these three regions: Kandhari Global Beverages, SLMG Beverages, and Moon Beverages, respectively.
This move was part of Coca-Cola’s strategy to divest assets on a global scale, transitioning regional operations to local partners through franchising.
In the India market, the Coca-Cola company reported “growth” in unit case volume during the first quarter of 2024, according to its statement.
However, in the Asia Pacific market zone, which includes India, unit case volume has declined by 2 percent in the first quarter due to decreases in water, sports drinks, coffee, and tea.
“Growth in the Philippines, India, Vietnam, and Indonesia outpaced declines in China,” the report highlighted.
On a global scale, the Coca-Cola company experienced a 1 percent increase in unit case volume in 2024.
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Unit case volume refers to the quantity of unit cases of company beverages sold directly or indirectly by the company and its bottling partners to customers.
In the March quarter, The Coca-Cola Company’s net revenue increased by 2.9 percent to USD 11.3 billion, with organic revenues (non-GAAP) experiencing an 11 percent growth.
James Quincey, Chairman and CEO of Coca-Cola Company, expressed, “We are pleased with our performance in early 2024, achieving growth in volume, revenue, and earnings despite a challenging environment.”
Regarding the outlook, the company anticipates achieving organic revenue (non-GAAP) growth of 8-9 percent. This projection comprises robust operational performance aligning with the company’s long-term growth model, as well as the expected pricing effects in several markets grappling with significant inflation.
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