Ladhani Group to Invest Rs 11,000 Crore in Next 5 Years, Expects Rs 20K Crore Revenue from SLMG Beverages

Ladhani Group, which is the largest bottler of Coca-Cola in India and has also a play in the hospitality and chemicals segments, plans to invest around Rs 11,000 crore in the next five years across its verticals, a top company official said on Wednesday.

It plans to spend around Rs 8,000 crore on SLMG Beverages, its flagship firm and the largest bottling franchisee for Coca-Cola in India, for opening new units to expand its presence in Uttar Pradesh and newly acquired markets of Bihar.

SLMG Beverages is among the top 15 bottlers globally for Coca-Cola and aims to be among the top ten in the coming years. It is ready for more franchising opportunities in India and foreign countries, its Joint Managing Director Paritosh Ladhani told PTI.

The Lucknow-based group also plans to invest around Rs 3,000 crore in its hospitality business in the next five years and double the number of hotel rooms.

SLMG Beverages, which is setting up a new plant in Bihar at Buxar with an investment of Rs 1,200 crore, has plans to open one more similar plant with an additional investment of Rs 1,500 crore, he said.

Besides, the company also plans to invest to expand its existing bottling plants near Lucknow, Amethi, Bareilly, Ayodhya for brownfield expansion and new green plants in Uttar Pradesh to meet the growing demand for fizz and non-fizz-based beverage products in the country's most populous state.

"So beverages, I think like five years, it will be a billion dollars (around Rs 8,000 crore. while in hospitality for the next three years. The hotel, which is in the pipeline, could be three to five years, we plan to invest about Rs 3,000 crore in the hospitality industry," said Ladhani.

When asked about the funding of the proposed investment, Ladhani said it will be a mix of debt and internal accruals.

SLMG Beverages accounts for more than 70 per cent of the revenue of Ladhani group. The bottler has an installed capacity of 33,000 bpm (bottlings per minute). It expects its revenue to cross Rs 8,000 crore and Rs 10,000 crore by the next 2025-26 fiscal.

SLMG Beverages is quite encouraged with the high growth rate of UP and Bihar, and expects this growth will convert into more consumption from urban and rural areas cumulatively. It expects to double its revenue to Rs 20,000 crore in the next five years, said Ladhani.

“We are looking at doubling our revenue to Rs 20,000 crore. Because the state which we are, Bihar right now is at Rs 12 lakh crores, and they plan to cross 20 lakh crores. UP's GDP is currently USD 260 billion they want to become a trillion dollar in the next five years," he said, adding "If UP and Bihar grow at the current CAGR, then probably our CAGR, which we are planning at 15 to 17 per cent it can go up to 20 per cent."

The company had last year acquired rights for the Bihar market from Coca-Cola's bottling arm HCCBL, as the Atlanta-headquartered firm is divesting its bottling assets globally as per its asset-light strategy.

When asked if the group would lap more opportunities for Coca-Cola in other parts of the country or even in the overseas markets, Ladhani said: "We are the largest (bottler of Coca-Cola) in the country as and when the opportunity comes in India or abroad, we are very open for it."

However, when asked whether Ladhani group is considering any IPO for SLMG Beverages, he replied, "Definitely, we have a plan".

On being asked about the time frame, Ladhani said IPO is a long process and the board is not in a hurry for that.

"Right now, the entire board, entire management team, is focused on grabbing the opportunities at the market and growing the way... we have internal enough internal accruals to invest in this business," Ladhani said.