Work begins on PepsiCo's largest beverage plant in India

Soft drink major PepsiCo's largest beverage plant in India is coming up in Andhra Pradesh at a cost of Rs.1,230 crore, its single largest investment in India.

At a ceremony held here Saturday, Chief Minister N. Kiran Kumar Reddy laid the foundation stone for the facility being built at Sri City, the special economic zone in Chittoor district.

The plant is being set up on 80 acres of land. It will be completed in three phases by 2017 and will generate direct and indirect employment for 8,000 people.

It will produce a range of beverages, including fruit juice based drinks, carbonated soft drinks and sports drinks.

The first phase of the project with an investment of Rs.450 crore will be completed in 2014. The second phase is expected to be ready in 2015 with an investment of Rs.400 crore. The third phase will be operational in 2017.

D. Shivakumar, chairman and CEO, PepsiCo India, said this was part of a recently announced plan by the company and its partners to invest Rs.33,000 crore in India by 2020.

Kanish Malik, vice president, operations, PepsiCo India, told reporters that each phase would have an annual capacity of 1.20 lakh litres.

When fully completed, the plant will procure two lakh tonnes of mango pulp every year, benefiting 50,000 to 60,000 farmers from Chittoor, Nellore and Prakasam districts.

PepsiCo, which already has 38 beverage bottling plants and three food plants in India, plans to make Andhra Pradesh the hub for procuring mango pulp. The firm already has a beverage plant at Sangareddy in Medak district.

"The Sri City plant will boost our production capacity and support the growing demand for PepsiCo India's beverage productions in Andhra Pradesh and peninsular India," said Shivakumar.

He claimed that it would be the most water efficient plant. The project will get water from Telugu Ganga canal. The company has also signed an agreement with Sri City for a desalination plant.

The officials clarified that no groundwater would be used for the facility.

Eight iconic brands of PepsiCo India generate Rs.8,000 crore or more in annual retail sales.

Shivakumar, who recently took over, declined to give figures about the company's share in soft drink market in India and other aspects.

Earlier, addressing the gathering, the chief minister thanked PepsiCo for choosing Andhra Pradesh for its largest plant. He urged the company to invest a major chunk of Rs.33,000 crore in the state and promised to provide all incentives from the government.

In her message, which was read out on the occasion, PepsiCo's chairperson and CEO Indira Nooyi said the company has great confidence in India's growth potential and has committed to Andhra Pradesh's future with this investment.

Industries minister J. Geetha Reddy said the state was attracting investment from global majors despite the current political turmoil over the proposed bifurcation of the state.

Cadbury, the household chocolate brand, last month began work on its largest manufacturing plant in the Asia-Pacific, which is also coming up at Sri City with an investment of Rs.1,000 crore.