Coca-Cola’s plans to take its bottling business to Dalal Street have moved a step closer. Hindustan Coca-Cola Holdings has appointed JPMorgan and Citi to steer the proposed 2027 IPO, Reuters reported, citing two sources familiar with the development. The company is also exploring the sale of part of its stake.The appointments were finalised after investment banks made presentations to Coca-Cola in London earlier this month, the sources said. One of them added that Kotak and Morgan Stanley have also been appointed to work on the proposed share sale.The beverage maker had announced in June that it was preparing to list its Indian bottling unit in 2027 while also exploring the sale of part of its holding. However, the valuation of the IPO and the proportion of shares that will be offered have not yet been determined.Coca-Cola and the banks did not immediately respond to Reuters’ requests for comment. The sources spoke on condition of anonymity as the discussions are confidential.
India emerges as preferred listing destination
The proposed listing reflects a broader trend of multinational companies choosing Indian stock markets to unlock value from existing investments instead of raising fresh capital.Reuters noted that companies such as Hyundai Motor and LG Electronics have also pursued stake sales through Indian IPOs, attracted by stronger market valuations than those available in their home market.People familiar with the matter had earlier told ET that Coca-Cola had roped in investment bankers including Kotak, HDFC Group and Citibank for the proposed IPO of Hindustan Coca-Cola Beverages (HCCB). According to those sources, the issue size has been pegged at about $1 billion (around Rs 9,027 crore), while internal preparations have been progressing towards a valuation of nearly $10 billion.Those sources added that Coca-Cola has been targeting a summer listing, although the timeline could be pushed back if unseasonal rains significantly affect peak summer beverage demand, as happened last year.IPO follows Coca-Cola’s asset-light strategyThe IPO process gained momentum after Coca-Cola sold a 40% stake in Hindustan Coca-Cola Holdings, the parent company of HCCB, to the Jubilant Bhartia Group for about Rs 12,500 crore.The transaction was part of Coca-Cola’s global asset-light strategy, under which the company has been reducing direct ownership of capital-intensive bottling businesses while focusing more on brand building, innovation and digitisation.Jubilant FoodWorks, a part of the Jubilant Bhartia Group, operates Domino’s Pizza, Popeyes and Dunkin’ Donuts in India. The partnership with HCCB is viewed as an opportunity to create long-term synergies between beverage operations and quick-service restaurant chains.
Hindustan Coca-Cola Holdings’ footprint
Coca-Cola currently owns a 60% stake in Hindustan Coca-Cola Holdings, one of its bottling partners in India. Established in 1997, the company operates 14 bottling plants across 10 states.According to the latest available data from company information platform Toefler, Hindustan Coca-Cola Holdings reported revenue of 127.35 billion Indian rupees (about $1.32 billion) and a net profit of $36 million in 2023.Coca-Cola is the leading player in India’s Rs 60,000-crore soft drinks market, selling brands including Coca-Cola, Thums Up, Sprite, Maaza, Kinley, Dasani, Georgia coffee and Schweppes mixers.HCCB operates 15 plants alongside several independent bottlers, with Coca-Cola supplying concentrate to its bottling partners across the country.
