Lucknow: Coca-Cola will divest its asset-heavy bottling operations in India in line with the beverage giant’s global strategy to sell asset-heavy operations to focus more on brands and strategy over time, the beverage maker’s global president and chief financial officer John Murphy said, adding that India has “tremendous ingredients for growth with a lot of investment underway” by the company and its bottling partners.

“Over the coming years, we will divest bottling. But we will do it in a very thoughtful and deliberate manner,” Murphy said while addressing a query on the same at a media round table at the Lucknow plant of Coca-Cola’s largest franchise bottling partner SLMG Beverages owned by the Ladhani group.

ET had first reported in its January 13, 2023 edition that Hindustan Coca-Cola Beverages (HCCB), Coca-Cola’s bottling arm, has revived plans of selling its business with robust post-pandemic recovery of the business accelerating the beverage maker’s valuation.

“As a company, our focus is on things that we think we are good at and that is building brands. We have good franchise partners around the world and they are developing the ecosystem,” Murphy, with the Atlanta-based beverage giant since 1988 across diverse roles such as general management, finance and strategic planning, said.

The sell-off process, however, would be complex and involve the asset sale of about two dozen bottling plants operated by HCCB. Potential buyers could include industrial houses or foreign or local bottling partners.

The beverage maker had first started the divestment process in end-2019, by selling off its bottling units in the north, which accounted for 10% of its bottling operations. But plans to sell the remaining business were paused as Covid-19 struck.

Calling out the progress India as a country is making as “really impressive”, Murphy named infrastructure, electrification, digitisation, which he said has transformed the landscape of not only larger cities and towns but also rural parts of India, significant reduction in poverty over the last 15 to 20 years, foreign direct investment numbers and economic growth as key growth triggers. “Extraordinary progress is underway. I don’t know too many countries which have developed or are developing that capability. There’s a long runway ahead for growth here,” he said.India, the Atlanta-based beverage maker’s fifth largest market in terms of volume sales, had the “strongest year ever”, the company said at a recent Consumer Analyst Group of New York conference, and called out that the domestic market here is expanding horizontally and adding retailers, with an “extraordinary” increase in bottling capacity.

On how Coca-Cola would sustain its growth momentum, Murphy said: “I think the formula is fairly straightforward-we start with the consumer, their beverage needs, shaping a portfolio, and being adaptable to local needs and trends”. Stating that soft drinks are a “daily business”, he said: “We need to stay very humble and remind ourselves-we actually haven’t sold anything yet next month. That keeps you very grounded”.