Company Highlights Coca-Cola worldwide and in India The Coca-Cola Company is the worlds largest beverage company.

Along with Coca-Col a, recognized as the worlds most-valuable brand, the Company markets four of the worlds top five soft drink brands, including Diet Coke, Fanta and Sprite and a wi de range of other beverages, including water, juices and juice drinks, tea, coff ee and sports drinks. Through one of the worlds largest beverage distribution sys tem, consumers in more than 200 countries enjoy The Coca-Cola Companys beverages at a rate exceeding 1.6 billion servings each day. Coca-Cola in India is the countrys leading beverage Company with an unmatched por tfolio of beverages. The Company manufactures and markets leading beverage brand s like Coca-Cola, Thums Up, Fanta, Fanta Apple, Limca, Sprite, Maaza, Minute Mai d, Burn, Kinley and Georgia range of tea coffee, Nestea and Fanta Fun Taste. One of the early investors in India, the Coca-Cola system provides direct and in direct employment to more than 1, 50,000 people. The Coca-Cola System in India h as more than 1 million retailers and our business has a multiplier effect on emp loyment and earning opportunities. Coca-Cola in India is the largest domestic bu yer of sugar and one of the top buyers of mango pulp. The Coca-Cola System in In dia business also positively impacts industries like Glass, Plastics, Resin Manu facturers, Sugar, Automobiles, White Goods Manufacturers, Banking etc. The Coca-Cola Company has always placed high value on good citizenship. At the h eart of business is a mission statement called the Coca-Cola Promise - The Coca-C ola Company exists to benefit and refresh everyone that it touches. This basic pr oposition entails that the Companys business should refresh the markets, protect, preserve and enhance the environment and strengthen the community. Coca-Cola In dia provides extensive support for community programs across the country, with a focus on education, health and water conservation. The Company has installed mo re than 500 rain water harvesting structures in the country. The Company has als o undertaken the rejuvenation and reconstruction of several traditional water bo dies including check dams. We are also working towards providing clean drinking water to school children in Chennai and areas in West Bengal in partnership with Rotary International and UN Habitat respectively. The Company is committed to w ork with communities across India in its effort to contribute to mutual growth a nd development. Coca-Cola System Worldwide & India At the core of our business in India, as in the rest of the world is our product ion and distribution network, which we call the Coca-Cola system. Globally, the Co ca-Cola system includes our Company and more than 300 bottling partners. The Coc a-Cola Company manufactures and sells concentrate and beverage bases. Our author ized bottlers combine our concentrate or beverage bases as the case may be with sweetener (depending on the product), water or carbonated water to produce finis hed beverages. These finished beverages are packaged in authorized containers be aring our trademarks -- such as cans, refillable glass bottles, non-refillable P ET bottles and tetra packs -- and are then sold to wholesalers or retailers. In India, additionally, the Company also sells certain powdered beverage mixes such as Vitingo and Fanta Fun Taste. Our beverages reach our ultimate consumers through our customers: the grocers, s mall retailers, hypermarkets, restaurants, convenience stores and millions of ot her businesses that are the final points of distribution in the Coca-Cola system . What truly defines the Coca-Cola system, and indeed what makes it unique among businesses, is our ability to create value for our customers and consumers. In India, the Coca-Cola system comprises of a wholly owned subsidiary of The Coc a-Cola Company namely Coca-Cola India Pvt Ltd which manufactures and sells conce ntrate and beverage bases and powdered beverage mixes, a Company-owned bottling entity, namely, Hindustan Coca-Cola Beverages Pvt Ltd; thirteen authorized bottl ing partners of The Coca-Cola Company, who are authorized to prepare, package, s ell and distribute beverages under certain specified trademarks of The Coca-Cola Company; and an extensive distribution system comprising of our customers, dist ributors and retailers. Coca-Cola India Private Limited sells concentrate and be

verage bases to authorized bottlers who are authorized to use these to produce o ur portfolio of beverages.These authorized bottlers independently develop local markets and distribute beverages to grocers, small retailers, supermarkets, rest aurants and numerous other businesses. In turn, these customers make our beverag es available to consumers across India. Mission, Vision & Values The world is changing all around us. To continue to thrive as a business over th e next ten years and beyond, we must look ahead, understand the trends and force s that will shape our business in the future and move swiftly to prepare for wha t s to come. We must get ready for tomorrow today. That s what our 2020 Vision i s all about. It creates a long-term destination for our business and provides us with a "Roadmap" for winning together with our bottling partners. Our Mission Our Roadmap starts with our mission, which is enduring. It declares our purpose as a company and serves as the standard against which we weigh our actions and d ecisions. To refresh the world... To inspire moments of optimism and happiness... To create value and make a difference. Our Vision Our vision serves as the framework for our Roadmap and guides every aspect of ou r business by describing what we need to accomplish in order to continue achievi ng sustainable, quality growth. People: Be a great place to work where people are inspired to be the best they c an be. Portfolio: Bring to the world a portfolio of quality beverage brands that antici pate and satisfy people s desires and needs. Partners: Nurture a winning network of customers and suppliers, together we crea te mutual, enduring value. Planet: Be a responsible citizen that makes a difference by helping build and su pport sustainable communities. Profit: Maximize long-term return to shareowners while being mindful of our over all responsibilities. Productivity: Be a highly effective, lean and fast-moving organization. Our Winning Culture Our Winning Culture defines the attitudes and behaviors that will be required of us to make our 2020 Vision a reality. Live Our Values Our values serve as a compass for our actions and describe how we behave in the world. Leadership: The courage to shape a better future Collaboration: Leverage collective genius Integrity: Be real Accountability: If it is to be, it s up to me Passion: Committed in heart and mind Diversity: As inclusive as our brands Quality: What we do, we do well Focus on the Market Focus on needs of our consumers, customers and franchise partners Get out into the market and listen, observe and learn Possess a world view Focus on execution in the marketplace every day Be insatiably curious Work Smart Act with urgency Remain responsive to change Have the courage to change course when needed

Remain constructively discontent Work efficiently Act Like Owners Be accountable for our actions and inactions Steward system assets and focus on building value Reward our people for taking risks and finding better ways to solve problems Learn from our outcomes -- what worked and what didnt Be the Brand Inspire creativity, passion, optimism and fun

Message from Leadership From the CEOs Desk Dear Friends, 2010 was quite a challenging year; but we exceeded our volume and profit commitm ents. We successfully cycled 30 percent growth of last year, and continued to gr ow volumes during the year. I am immensely proud of all that we as a Business Unit, have accomplished in the past 5 years. In these years we have been successful in turning around and buil ding a locally relevant, growth oriented and profitable business in India. Today we are the clear leader in the NARTD business with seven of the top ten brands (including the top two) in the country. We have delivered 21 consecutive quarter s of growth with 15 in double digit; we have achieved strong system health where in all our Bottlers are investing aggressively in the business; we are viewed as an Employer of Choice wherein the best talent would like to join and work with us and most importantly, we are recognized as an integral part of the communitie s we serve. We have all, together, achieved something that we can truly be proud of. Today, India and South West Asia Business Unit is well on track to achieve our 2020 vis ion of being among the top Coca-Cola businesses in the world. The highlights of the year include was our entry into the dairy segment with the launch of Maaza Milky Delite in Kolkata. The product has been developed at our R&D lab in Gurgaon and is a delicious blend of juicy mangoes and milk. The initi al feedback on the product and the communication has been very positive and enco uraging. We also launched the globally successful Nestea Ready-to-drink beverage in Mumbai in the last quarter of the year. Earlier in the year, we launched Min ute Maid Nimbu Fresh and the product is setting new benchmarks in the lemonade s egment. The launch of the second edition of the Coca-Cola Mir Iqbal Hussain trop hy to encourage grassroots football was the other notable achievement during the year. Our focus on sports got a new dimension with our successful partnership i n hosting the XIX Commonwealth Games in New Delhi. The Games provided us an oppo rtunity to hydrate more than 7,000 athletes and delegates and more than 20,000 v olunteers who participated in the Games. In addition to our range of sparkling a nd still beverages available in India, we also provided to the athletes our glob al sports drink brand Powerade and Minute Maid 100% juice. Our partnership with the Commonwealth Games is in keeping with our belief that sports promotes health y, active living and social cohesiveness and we are happy to play the role of ca talysts in this exercise. We remain committed to work with communities across the country for our mutual g rowth and development; and I look forward to your continued support in carrying the growth momentum forward. Best Regards Atul Singh, President & CEO, Coca-Cola India & South West Asia

Products/ Service Range

Organizational Structure of Coca-cola

Industry Analysis Using Porters Five Forces Model Rivalry among the competitors : Revenues are extremely concentrated in this industry, with Coke and Pepsi, toget her with their associated bottlers, commanding 73%. Adding in the next tier of s oft drink companies, the top six controlled 89% of the market. In fact, one coul d characterize the soft drink market as an oligopoly, or even a duopoly between Coke and Pepsi, resulting in positive economic profits. To be sure, there was to ugh competition between Coke and Pepsi for market share, and this occasionally h ampered profitability. For example, price wars resulted in weak brand loyalty and eroded margins for bo th companies in the 1980s.The Pepsi Challenge, meanwhile, affected market share without hampering per case profitability, as Pepsi was able to compete on attrib utes other than price. Substitutes: Through the early 1960s, soft drinks were synonymous with colas in the mind of con sumers. Over time, however, other beverages, from bottled water to teas, became more pop ular, especially in the 1980s and 1990s. Coke and Pepsi responded by expanding their offerings, through allian ces (e.g. Coke and Nestea), acquisitions (e.g. Coke and Minute Maid), and internal product innovation (e.g. Pepsi creating Orange Slice), capturing the value of increasingly popular substitutes internally. Proliferatio n in the number of brands did threaten the profitability of bottlers through 1986, as they more frequent line set-ups, increased capital investment, and development of special management skills for more complex manufa cturing operations and distribution. Bottlers were able to overcome these operational challenges throug h consolidation to achieve economies of scale. Overall, because of the CPs efforts in diversification, howe ver, substitutes became less of a threat. Power of Suppliers: The inputs for Coke and Pepsis products were primarily sugar and packaging. Sugar could be purchased from many sources on the open market, and if sugar became too expensive, the firms could easily switch to corn syrup, as they did in the early 1980s. So suppliers of nut ritive sweeteners did not have much bargaining power against Coke, Pepsi, or their bottlers. NutraSweet, meanwh ile, had recently come off patent in 1992, and the soft drink industry gained another supplier, Holland Swe etener, which reduced Searles bargaining power and lowering the price of aspartame. 2 With an abundant supply of inexpensive aluminum in the early 1990s and several c an companies competing for contracts with bottlers, can suppliers had very little supplier po wer. Furthermore, Coke and

Pepsi effectively further reduced the supplier of can makers by negotiating on b ehalf of their bottlers, thereby reducing the number of major contracts available to two. With more than two comp anies vying for these contracts, Coke and Pepsi were able to negotiate extremely favorable agreements. In the plastic bottle business, again there were more suppliers than major contracts, so direct negoti ation by the CPs was again effective at reducing supplier power. Power of buyers: The soft drink industry sold to consumers through five principal channels: food stores, convenience and gas, fountain, vending, and mass merchandisers (primary part of O ther in Cola Wars case). Supermarkets, the principal customer for soft drink makers, were a highly fragme nted industry. The stores counted on soft drinks to generate consumer traffic, so they needed Coke and Pepsi products. But due to their tremendous degree of fragmentation (the biggest chain made up 6% of foo d retail sales, and the largest chains controlled up to 25% of a region), these stores did not have much bargain ing power. Their only power was control over premium shelf space, which could be allocated to Coke or Pepsi products. This power did give them some control over soft drink profitability. Furthermore, consumers exp ected to pay less through this channel, so prices were lower, resulting in somewhat lower profitability. National mass merchandising chains such as Wal-Mart, on the other hand, had much more bargaining power. While these stores did carry both Coke and Pepsi products, they could neg otiate more effectively due to their scale and the magnitude of their contracts. For this reason, the mass m erchandiser channel was relatively less profitable for soft drink makers. The least profitable channel for soft drinks, however, was fountain sales. Profi tability at these locations was so abysmal for Coke and Pepsi that they considered this channel pai d sampling. This was because buyers at major fast food chains only needed to stock the products of on e manufacturer, so they could negotiate for optimal pricing. Coke and Pepsi found these channels important, ho wever, as an avenue to build brand recognition and loyalty, so they invested in the fountain equipment and cu ps that were used to serve their products at these outlets. As a result, while Coke and Pepsi gained only 5% marg ins, fast food chains made 75% gross margin on fountain drinks. Vending, meanwhile, was the most profitable channel for the soft drink industry. Essentially there were no buyers to bargain with at these locations, where Coke and Pepsi bottlers could sell directly to consumers through machines owned by bottlers. Property owners were paid a sales commission on Coke and Pepsi products sold through machines on their property, so their incentives were properly aligned with those of the soft drink makers, and prices remained high. The customer in this case was t he consumer, who was generally limited on thirst quenching alternatives.

The final channel to consider is convenience stores and gas stations. If Mobil o r Seven-Eleven were to negotiate on behalf of its stations, it would be able to exert significant bu yer power in transactions with Coke and Pepsi. Apparently, though, this was not the nature of the relationship between soft drink producers and this channel, where bottlers profits were relatively high, at $0.40 per case, in 1993. With this high profitability, it seems likely that Coke and Pepsi bottlers negotiated directly with convenience store and gas station owners. So the only buyers with dominant power were fast food outlets. Although these ou tlets captured most of the soft drink profitability in their channel, they accounted for less than 2 0% of total soft drink sales. Through other markets, however, the industry enjoyed substantial profitability b ecause of limited buyer power. Barriers to Entry: It would be nearly impossible for either a new CP or a new bottler to enter the industry. New CPs would need to overcome the tremendous marketing muscle and market presen ce of Coke, Pepsi, and a few others, who had established brand names that were as much as a century old . Through their DSD practices, these companies had intimate relationships with their retail channels and would be able to defend their positions effectively through discounting or other tactics. So, although t he CP industry is not very capital intensive, other barriers would prevent entry. Entering bottling, meanwhile, wou ld require substantial capital investment, which would deter entry. Further complicating entry into this market , existing bottlers had exclusive territories in which to distribute their products. Regulatory approval of intrabrand exclusive territories, via the Soft Drink Interbrand Competition Act of 1980, ratified thi s strategy, making it impossible for new bottlers to get started in any region where an existing bottler operated , which included every significant market in the US. Organizational Appraisal of the Firm ETOP SWOT/ TOWS Matrix Strength Strong leading brands: Coco-Cola is a very strong brand with high level of consu mer acceptance. This allows the company to extend its product to attract new cus tomers. Large scale of operations: Coca-Cola products are already sold in more than 200 countries. In addition it recorded revenues of $31 million making the largest ma nufacturer in the world. Leading Market Position: The brand has the largest market share of about 5% more than its competitor PepsiCo. Strong cash flows from operations: The brand is able to create over $50 million a day. Opportunities

Global growth in non-alcoholic ready-to-drink beverage industry. This trend is s et to generate retail sale in the industry to more than $1 trillion by 2010. Growing global bottle water market. Booming global functional drinks market. Example, energy drinks Target the aging customers and youth. Weakness Financial market volatility Balanced Score Card Vision People: Be a great place to work where people are inspired to be the best they c an be. Portfolio: Bring to the world a portfolio of quality beverage brands that antici pate and satisfy people s desires and needs. Partners: Nurture a winning network of customers and suppliers, together we crea te mutual, enduring value. Planet: Be a responsible citizen that makes a difference by helping build and su pport sustainable communities. Profit: Maximize long-term return to shareowners while being mindful of our over all responsibilities. Financial Customer Objective: Focus on needs of the consumers, customers and franchise partners Measures: Get out into the market and listen, observe and learn Targets: To be the customers, consumers first choice Initiative: Possess a worldview, focus on execution in the marketplace every day , and be insatiably curious. Learning and Growth Objective : To provide the quality wise best products to the customer and remain responsive to change Measures : Remain constructively discontent Targets : Learn from our outcomes -- what worked and what didnt Initiatives : Rewards its people for taking risks and finding better ways to sol ve problems and motivate them to change the course of action whenever needed. Internal Business Process Objectives : To maximize the value of the shareholders and customers and to exce l in the distribution networks Measures : The company has taken steps to strengthen the relationship with the s uppliers and retailers and has increased its product line. Target : The target of the company is to become one of the best company to inves t in the market. Strategic Management Issues

Strategies for Coca Cola Company From these four strategies Coca-Cola Company follow the Multi-domestic strategie s. They produce their products independently in different countries. All countri es product are not same. They produce their products by following different stra tegy for different countries, based on the internal and external environment of the country. Coca-Cola company developed their strategy by considering the nature of the peop le of different countrys people, culture, status and so many other related factor s. Behind the reasons of this strategy may be that, different countries economies of scale for production, distribution, and marketing are low, side by side cost of coordination between the parent corporation and its various foreign subsidia ries is high. Because each subsidiary in a multi-domestic corporation must be re sponsive to the local market, the parent company usually delegates considerable

power and authority to managers of its subsidiaries in various host countries. Home Replication Strategy In this strategy, a firm utilizes the core competency or firm-specific advantage it developed at home as its main competitive weapon in the foreign markets that it enters. That is, it takes what it does exceptionally well in its home market and attempts to duplicate it in foreign markets. Multi-domestic Strategy It is the second alternative available to international firm. A multi-domestic c orporation views itself as a collection of relatively independent operating subs idiaries, each of which focuses on a specific domestic market. Global Strategy It is the third alternative available for international firms. A global corporat ions views the world as a single market place and has as its primary goal the cr eation of standardized goods and services that will address the needs of custome rs worldwide. Levels of strategies followed by Coca-Cola Corporate Level Strategy Corporate level strategy attempts to define the domain of business the firm inte nds to operate. Corporate level strategy fundamentally is concerned with the sel ection of businesses in which the company should compete and with the developmen t and coordination of that portfolio of businesses. A firm might adopt any of th ree forms of corporate strategy: A single business strategy Related diversification strategy and Unrelated diversification strategy. Coca-Cola company follows related diversification strategy that is calls for the firm to operate in several different but fundamentally related businesses. Each of its operations linked to the others Coca-Cola characters, the Coca-Cola logo , and a theme of wholesomeness and a reputation for providing high quality famil y products. Coca-Cola company follows this strategy because it has several advan tages. At first, the firm depends less on a single products so it is less vulnerable to competitive or economic threats. Secondly, related diversification may produce economies of scale for a firm. Thirdly, related diversification may allow a firm to use technology or expertise developed in one market to enter a second market more cheaply and easily. Corporate level strategies of Coca-Cola company is fol lowing---Business Unit Level Strategy A strategic business unit may be a division, product line, or other profit cente r that can be planned independently from the other business units of the firm. C orporate strategy deals with the overall where as business strategy focuses on s pecific businesses, subsidiaries or operating units within the firm. Business se eks to answer the question how should we compete in each market we have chosen t o enter? The firms develop unique business strategy for each of its strategic bus iness units, or it may pursue the same business strategy for each for all of the m. The three basic business strategies are Differentiation Overall cost leadership Focus

Coca-Cola company uses differentiation strategy effectively. Functional Level Strategy The functional level strategy attempts to answer to question How we manage the fu nction? The functional level of the organization is the level of the operating di visions and departments. The strategic issues at the functional level are relate d to business processes and the value chain. Functional level strategies in mark eting, finance, operations, human resources, and R&D involve the development and coordination of resources through which business unit level strategies can be e xecuted efficiently and effectively. Functional units of an organization are inv olved in higher level strategies by providing input into the business unit level and corporate level strategy, such as providing information on resources and ca pabilities on which the higher level strategies can be based. Once the higher-le vel strategy is developed, the functional units translate it into discrete actio n-plans that each department or division must accomplish for the strategy to succeed.