Blasé Capital IPO FIZZ

Hindustan Coca-Cola Beverages (HCCB), one of the major bottling arms of Coca-Cola, the American soft drinks giant, may soon go public. Sources indicate that the firm has appointed a few investment bankers to launch the IPO (Initial Public Offering) this year to raise a billion dollars. HCCB’s overall valuation may be $10 billion, which will imply a sale of 10 per cent of the equity. Most of the shares on offer are likely to be those held by Coca-Cola, and other minority investors. However, one is not sure if the Bhartia Group, which picked up 40 per cent stake in HCCB recently, will dilute its holdings. The group has expanded in the food, retail, and beverage business over the years. The IPO will be another one in the trend of IPOs by foreign MNCs like Hyundai and LG in 2024 and 2025. However, the Coca-Cola IPO will raise a lesser amount than them.

The timing of the IPO will depend on several factors. Although media reports indicate that it may be launched as early as this summer, the weather may dictate the final dates. For example, if the 2026 summer is like what we witnessed in 2025, when the peak summer demand for soft drinks was dented by unusual, prolonged, and heavy rainfall, the IPO may be postponed to next year. If the demand for plant and equipment by both new and existing other bottlers, which may be owned and controlled by Coca-Cola, or independent, may be a factor in the IPO. This is because HCCB will wish to show excellent, and better quarterly results prior to the IPO. If revenues, and profits dip in the first two quarters of the calendar year, the IPO may be pushed to the next summer in 2027 to increase investors’ interest.

According to sources, Coca-Cola has decided to reduce its ownership in the bottling plants across the world, and focus more on the main business of selling soft drinks, other beverages, and food products. The sale of 40 per cent stake in HCCB to the Bhartia Group was a huge step in this direction. A further dilution, and listing through IPO, may pave the way for further dilution in the future. If the Bhartia Group does not sell a part of its stake via the IPO, it may emerge as the largest shareholder, even a majority one, if Coca-Cola decides to remain a minority partner. However, such decisions will revolve around Coca-Cola’s wish to retain complete control over its secret and proprietary cola formula. This is one of the reasons why it controlled HCCB, which was the principal vehicle for its expansion in India, and sold only 40 per cent to the Bhartia Group.

A HCCB source told a newspaper, “We are focused on strengthening marketplace execution with a strong commitment to our consumers. We have been passing on the benefits of the new GST-led pricing to ensure better value, and more affordable choices to consumers. With a realigned leadership team in place, we remain focused on driving operational excellence to enhance the overall consumer experience. Any other news is speculative.” Other sources, quoted in media reports, deny the timing of the IPO, or even the IPO. One of them said, “An IPO is not something that is on the table for this summer, or anytime soon.” But such denials do not mean anything since it is prudent for Coca-Cola to keep the IPO details under wrap.

Back home in the Atlanta headquarters, Coca-Cola recently initiated leadership changes that highlights the changes in the way the cola giant views the Indian market. As Henrique Braun gets ready to become the parent firm’s CEO in March this year, it created two new roles to “enhance focus on markets in Asia, Africa, and the Middle East. Sanket Ray will become the president for the operations in India, and Southwest Asia which, apart from India, will include China, Japan, and South Korea. The markets of Eurasia, Middle East, Asean, South Pacific, and Africa will be overseen by Caludia Lorenzo, who too is designated a president. “These changes are intended to help equip our organisation to handle the dynamic conditions we are seeing in markets around the world. Sanket and Claudia bring deep regional experience, and established leadership, which will be crucial as we seek to tap into the immense growth potential we see across the markets they will lead,” says Braun.

Coca-Cola hopes to unify digital, data, and operational excellence through a new role of chief digital officer. As Sedef Sahin takes over this role, he will “lead the next chapter of Coca-Cola’s digital journey, integrating the company’s digital network, and connecting across work related functions.” Braun explains, “The Chief Digital Officer position is a pivotal new role for our future. Sedef’s proven leadership will help shape how we digitalise the enterprise end-to-end, and over the next several months she will assess how to organise the teams responsible for digital across the enterprise to help strengthen execution, simplify how we work, and enable us to deliver for consumers with greater precision and speed.” Sahin’s earlier roles in marketing, and the operations in the Middle East and Eurasia “involved extensive work to lead the digitalisation of the business, including the transformation of the marketing organisation.”