HCCBL Expects Growth in FY26 Despite Disruptions in H1; 4 Jubilant Nominees Join Board

Hindustan Coca-Cola Beverages, the bottling arm of beverage major Coca-Cola in India, expects a decent growth in FY26 despite facing disruptions in the first half, from adverse weather conditions to external macroeconomic pressures, according to a top company official.

HCCBL hopes for a "promising potential outlook", encouraged by favourable macro conditions, such as rapid urbanisation and rising disposable income, and it would continue to invest in expansion of capacity, portfolio and distribution, among others, said its Chief Financial Officer Harsh Bhutani.

Besides, the board of Hindustan Coca-Cola Beverages Ltd (HCCBL) has been reconstituted after the parent entity, The Coca-Cola Company, divested a 40 % stake to Jubilant Bhartia Group.

According to an industry insider, four people from the Jubilant Bhartia Group, engaged in pharmaceuticals, food services, agribusiness, energy, and other services, have joined the board of HCCBL.

When asked about the development, Bhutani told PTI that after the deal, the HCCBL board has been reconstituted.

"After the 40 % stake sale to the Jubilant Bhartia Group, HCCB is now jointly owned by The Coca-Cola Company and The Jubilant Bhartia Group. The transaction was concluded in July, post which the board has been reconstituted," he said.

Earlier this month, The Coca-Cola Company Chairman and Chief Executive Officer James Quincey, in the latest earnings calls, said it has sold a 40 % ownership stake in company-owned Indian bottler (HCCBL) in July this year to Jubilant Bhartia Group. This is per its strategy to refranchise company-owned bottlers to fortify the system and unlock further growth, he said.

"Together with our new business partners, we are focused on evolving the business and continuing to win in the marketplace," said Bhutani.

HCCBL, like other beverage makers, faced disruptions in the first half of FY26, "driven by adverse weather conditions and external macroeconomic pressures".

However, unfazed by this, Bhutani said: "Despite these challenges, we remain confident in our ability to recover and continue investing in the market and delivering sustainable growth".

As per RoC filings by HCCBL, in FY25, its revenue from operations slipped 9 % to ₹ 12,751.29 crore, and its net profit fell 73 % to ₹ 756.64 crore. However, this was due to a high base in 2023-24 on account of gains from divesting bottling operations in Rajasthan, Bihar, North-East and parts of West Bengal.

According to Bhutani, on a like-for-like basis, HCCBL revenue was actually up 5.9 % in FY25 in comparison to FY24.

"On an adjusted comparable basis in FY25, comparable revenue we delivered grew (+) 5.9 % over FY24, with a Profit Before Tax margin of 7.2 %. The EBITDA margin stood at 13.2 % (grew in line with revenue growth over the same period)," he said.

HCCBL's growth drivers continue to be execution excellence, capacity expansion, and portfolio strength.

"We are investing heavily in distribution expansion - opening new outlets, adding coolers, strengthening our presence on the street and increasing distribution points. These on-ground efforts will remain our primary growth levers for the foreseeable future," said Bhutani.

Over the second half (H2), which covers festivals and other occasions for consumption, HCCBL expects to stay on a growth trajectory.

"From H2's perspective, we are well prepared, in terms of capacity, portfolio and execution plans. As the weather normalises, we are well-positioned to take advantage of the next two quarters.

"It’s hard to forecast the exact numbers, but we remain focused on driving growth. The India growth story remains robust, and despite the temporary setbacks, we expect to stay on that trajectory," said Bhutani.

HCCBL, to meet the growing demand, has invested ₹ 6,500 crore in the last two years in India, which is the fifth largest market of Coca-Cola globally.

"Last year, we invested about ₹ 3,100 crore in capacity expansion, and the year before that about ₹ 3,400 crore. We continue to invest because of the huge growth potential we see ahead," said Bhutani.

HCCBL currently has 14 manufacturing locations, including two new greenfield plants that became operational in the past year, one in Telangana and another in Maharashtra.

"Along with these, we also have a few contract packing locations that supply to us," said Bhutani.

Earlier, in 2024, HCCBL had divested bottling operations in Rajasthan, Bihar, North-East and parts of West Bengal to its existing independent bottlers - Kandhari Global Beverages, SLMG Beverages, and Moon Beverages, respectively - on a going concern basis through a slump sale.