Coca-Cola bottler Ladhani Group's SLMG Beverages eyes overseas expansion

Ladhani Group-owned company plans to double its revenue to Rs 20,000 crore by FY31

Coca-Cola’s largest independent bottler in India, the Ladhani Group-owned SLMG Beverages, is seeking overseas expansion as opportunities in the country are starting to “dry up”, said a top executive of the company, which targets ₹20,000 crore in revenue by financial year 2031.

 

The Lucknow-based group is foraying into new segments of wealth management and strengthening its presence in the renewable energy space, moves that will provide higher upside and returns on small-scale investments.

 

“We will start looking at overseas markets since the Indian market is starting to dry up. We want to end the coming financial year, which is a benchmark year for us, before we start exploring that option,” Paritosh Ladhani, joint managing director, SLMG Beverages, told Business Standard.

 

“These are the sectors I am gung-ho about. While we already have a presence in solar energy, we will expand our presence there because the renewable energy industry makes sense for us. We are also looking at projects which include converting waste into energy – both electric and gas,” Ladhani said about exploring new segments.

 

An investment of ₹500 crore has been outlined for these ventures over the next three to four years. The company has five solar sites for power generation. Two are owned by it, while the remaining three are third-party contract sites. The company's wind mills are located in Karnataka and Rajasthan and generate 100 MW of renewable energy.

 

To clock a gross revenue of ₹8,000 crore in FY25, the bottler is targeting ₹10,000 crore in revenue in FY26 before expanding overseas. It also plans to double its revenue to ₹20,000 crore in the five years after FY26.

 

This growth, Ladhani said, will come from greenfield and brownfield structures, as well as inorganic opportunities overseas.

 

“We were looking for more opportunities from them (HCCB) in newer areas, but that ship has sailed. I am happy managing about 420 million consumers. If we get a chance, where bottlers in another country need an Indian brain to turn it around, and it makes sense for us to go into that market, we will take it up,” he added. 

 

In December last year, Coca-Cola announced it had reached an agreement with the Jubilant Bhartia Group to sell a 40 per cent stake in Hindustan Coca-Cola Holdings (HCCH) – the parent company of Hindustan Coca-Cola Beverages (HCCB) – Coca-Cola’s largest bottler in India.

 

The company - which currently operates eight bottling plants in Madhya Pradesh, Uttarakhand, Uttar Pradesh, and Bihar - is looking to invest ₹8,000 crore ($1 billion) to set up new plants and expand capacities in the existing ones. This includes the new plant being built in Bihar’s Buxar region with an investment of ₹1,200 crore.

 

About 30-35 per cent of the $1 billion funding will be raised through bank debt, while the rest will be taken care of by the company’s internal accruals. While it plans to raise debt to partially fund the expansion, Ladhani said that an IPO was still three to four years away.

  The group is also fortifying its presence in the luxury hospitality sector while exploring new avenues of growth. The group’s realty arm, Sincere Developers, will invest ₹3,000 crore to bring international chains like Ritz Carlton and Four Seasons to new territories in the country.

 

“Apart from the Taj in Agra, which we have just redesigned and tying up with the Oberoi Group for new developments in Rishikesh, I am in touch with a few large international chains, specifically Ritz Carlton and Four Seasons for Agra,” he said.