Dabur and Jubilant Eye Major Stake in Coca-Cola’s India Bottling Arm for $1.4 Billion

The Burman family of Dabur and the Bhartias, who own Jubilant Group, are close to buying a 40% stake in Hindustan Coca-Cola Beverages (HCCB) for ₹10,800-12,000 crore ($1.3-1.4 billion), according to insiders. This would value Coca-Cola India’s bottling subsidiary at around ₹27,000-30,000 crore ($3.2-3.6 billion).

The two groups submitted their bids over the weekend. Coca-Cola’s parent company will decide whether to proceed with one or both as co-investors or even consider forming an investor group. A decision is expected by the end of this fiscal year.

Earlier reports suggested that Coca-Cola had approached several Indian business houses and billionaire families, including the Parekhs of Pidilite Industries, the promoter family of Asian Paints, and others. However, only the Burmans and Bhartias have shown serious interest in bidding.

Some existing independent bottlers for Coca-Cola aren’t happy about these negotiations, believing they should have been offered the chance to increase their stakes. However, Coca-Cola is looking for high-profile business partners to fund this large deal.

Coca-Cola has been gradually selling off its company-owned bottling operations in certain regions of India to local partners, and is now looking to bring in significant investors before potentially taking HCCB public. India is a key growth market for Coca-Cola, and the company is focusing more on brand building and innovation while reducing its direct involvement in bottling operations.

HCCB, which handles Coca-Cola’s bottling operations in the south and west of India, reported a 40% increase in revenue to ₹12,840 crore in FY23, with net profits more than doubling to ₹809 crore. As Coca-Cola streamlines its global operations, the company’s focus is shifting towards becoming a leaner, more brand-focused business.