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The Coca-Cola Company (KO - Free Report) is all set to explore and expand in India, with a massive investment of $2 billion over the next five years, starting in 2012, as reported by Reuters. Coca-Cola is eyeing on the growing markets of India as the demand for its products have softened in the U.S.

Coca-Cola, along with its bottling partners, will make investment in consumer marketing, infrastructure and brand-building, and will expand its distribution facilities and develop its manufacturing capabilities.

Coca-Cola has been associated with India since years, and has a workforce of around 25,000 people. Further, Coca-Cola has been witnessing double digit growth rate in India aided by its top-brands, which includes Thums Up, Sprite and Maaza.

Coca-Cola, along with its rival PepsiCo Inc. (PEP - Free Report) has been targeting the vast market of India, which has been drawing long-term investments, despite global slowdown. The people in India are now spending more on beverages and processed foods, as against their Western counterparts, who are now becoming more health conscious.

Coca-Cola has already invested over $1 billion in the last 18 years and still remains very optimistic on the Indian operations. PepsiCo has also invested $500 million in India in 2008 and expects to triple its revenues over the next five years.

However, both Coca-Cola and Pepsi had faced hurdles in India. Coca-Cola was restricted to enter Indian markets for 16 years until 1993, for not revealing its secret recipe. Later in 2005, both the companies were banned on providing beverages in India because of concerns that the beverages contained pesticides.

Nevertheless, Coca-Cola has been fighting for gaining Indian market share with PepsiCo, since 1993. Coca-Cola accounts for 56% of India’s carbonated soft drinks market, while Pepsi has 40% share.

As part of an ongoing push into emerging markets, Coca-Cola had also planned in September 2011 to invest $3 billion in Russia over the next five years, along with its Coca-Cola Hellenic Bottling Company. The $3 billion investment in Russia will occur from 2012 to 2016.

In August 2011, Coca-Cola also decided to invest $4 billion in China to expand in its fast-growing consumer market. The investment will begin in 2012 and will take place over three years. Moreover, it will raise Coca-Cola's total investment in China between 2009 and 2014 to $7 billion.

Coca-Cola pointed that it is working with its bottling partners to invest almost $30 billion over the next five years for growing its businesses in the emerging economies.

Last month, Coca-Cola reported strong operating earnings of $1.03 per share in third-quarter 2011 that came ahead of the Zacks Consensus Estimate by a penny, and rose 12% from the year-ago quarter. The results were encouraged by strong growth outside the U.S. and in emerging markets.

Coca-Cola also sold more drinks in each region during the quarter and continued to gain market share in North America from peer PepsiCo.

Further, Coca-Cola's acquisition of Coca-Cola Enterprises Inc. (CCE - Free Report) ’s North American bottling operations led to expansion and stands to benefit from the manufacturing and distribution efficiencies in the U.S.

Further, we believe that Coca-Cola has the capacity to overcome the recession effects and sustain market share in the future. The Coca-Cola brand had market share of about 17% in the U.S. in 2010, much higher than its primary competitor PepsiCo, which had less than 11% market share.

Coca-Cola currently holds a Zacks #3 Rank, which translates into a short-term Hold rating. On a long-term basis, we maintain a Neutral rating on the stock.

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