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July 13, 2018 02:00 AM

India's Varun Beverages expands PET bottle making in Africa

Satnam Singh
Correspondent
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    Satnam Singh
    Gupta

    Mumbai, India — Indian soft drink producer Varun Beverages Ltd. is continuing its expansion in Africa, doubling capacity of a PET bottle making plant and investing in a PET preform plant for PepsiCo in Zimbabwe.

    A key associate of PepsiCo in the Indian and African beverage markets, Varun opened a 400-PET-bottles-per-minute plant in Harare, Zimbabwe's capital, in May.

    “We are doubling plant capacity next year and also putting-up a preform plant in Harare, expected to be operational next year,” said Executive Director Vivek Gupta, in an interview at a recent conference in Mumbai.

    VBL considers Zimbabwe a high-growth market in Africa. Currently, Coca-Cola dominates the organized beverage market in the country.

    “Africa is a growing opportunity and market of around 1.4 billion people and therefore, it is logical for us to expand our footprints in that market,” Gupta said.

    The company, which says it's the largest bottler for PepsiCo outside of the United States, has invested around $30 million in Zimbabwe for producing a range of Pepsi carbonated beverages, according to press reports. Gupta declined to comment.

    The National Stock Exchange and Bombay Stock Exchange-listed company said its upcoming preform site at Harare would likely have 100 tons capacity per day.

    Gupta spoke at the Injection, Blow, Roto & PET Moulding International Summit 2018, held July 5-6 in Mumbai.

    VBL has also been granted the franchise for various Pepsi products in Nepal, Sri Lanka, Morocco and Zambia. Varun, based in Gurugram, a Delhi suburb formerly named Gurgaon, also has Pepsi franchises in 18 states and two Union Territories in India.

    India is VBL's largest market and contributed 80 percent of its sales in its most recent fiscal year. It supplies around 51 percent of PepsiCo beverage volumes in India.

    Varun operates 21 PET bottling units for PepsiCo in India and is setting up a PET bottling plant, its 22nd factory, in Pathankot in the North Indian state of Punjab, to create in-house production for Tropicana fruit juices.

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