Pepsico to set up four new plants in India

Pepsico India chairman Sanjeev Chadha, who took charge as Pepsico India head three years ago, said there would be three greenfield plants on the beverages side

New Delhi: Focusing on India as a rapidly growing market, US soft drinks giant Pepsico would pump in an estimated Rs700 crore to set up four new food and beverages projects by 2012.

Just Days after its high-profile global board meeting that was hosted for the first time in the country earlier this month, Pepsico India chairman Sanjeev Chadha said “going forward, over the next three years, certainly we will be putting up new plants.”

Chadha, who took charge as Pepsico India head three years ago, said there would be three greenfield plants on the beverages side. “On the food side, at least there would be one more plant,” he said, but did not specify the quantum of investment involved.

He said on an average it costs around $30 million to set up a beverages plant and around $50-60 million a food plant.

Going by these estimates, Pepsico, whose global operations are headed by India-born Indra Nooyi, may have to shell out around $150 million (Rs700 crore)to set up these plants. The sites for the plants are yet to be finalized.

“We are in the process of searching and identifying, through a network analysis, as to where the location of these plants would be,” he added.

Since its entry in India 19 years ago, the company has invested over $1 billion in the country. This includes $600 million that is being invested.

Chadha said Pepsico is in the process of pumping in around $200 million this year itself.

Currently, Pepsico has 43 soft drinks plants in India, out of which 28 are company owned. It has three plants for the snacks business.

The new plants will be in addition to the expansion that will take place at the existing plants.

Chadha said Pepsico’s global board expects the company here to continue with robust growth, which has been tripling every five years.

“We have always talked about tripling our business in five years time and we are consistent about it. If you take any five years, we will be tripling that business in that five years time,” he added

“We will be definitely tripling our business (in value) over 2007 to 2012,” Chadha said.