(YUM) Yum! Brands Plans Expansion for India

November 14th, 2009

Even in the midst of an economic crisis, Yum! Brands Inc. (YUM), the operator of KFC, Pizza Hut and Taco Bell fast-food chains, remains largely unruffled by the slowdown and plans to accelerate its expansion in India with an investment plan of about $150 million.

Louisville, Kentucky-based Yum!, which operates about 150 Pizza Hut and 65 KFC outlets in India, plans to increase its restaurant count to 1,000 by 2015 with planned openings across 60 cities, requiring a strength of about 50,000 staff, five times more than the current level. The company plans to open its first Taco Bell restaurant in Bangalore by the end of 2009.

The Indian market has been virtually recession-proof providing ample growth opportunities. Yum! plans to tap India’s organized food and beverage market, which is growing rapidly by about 25% to 30% annually, but is even less than 1% of the $64 billion dining out market. The company plans to generate $1 billion in revenues by 2015.

Yum!’s restaurants in India, which are managed by Niren Chaudhary, faces stiff competition from other fast-food chains such as McDonald’s Corp. (MCD) and Domino’s Pizza Inc. (DPZ).

McDonald’s currently operates about 173 restaurants of which 91 are in North and East India and 82 in West and South India with plans to open 180-190 restaurants by 2015. Domino’s currently operates nearly 274 quick service restaurants across 54 cities in India.

Zacks Investment Research

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Read more on Yum! Brands, Investing in India at Wikinvest

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