Taurai Mangudhla and Tinashe Makichi
HARARE – Varun Beverages is set to expand into the agricultural sector as part of its business pillars of investing, re-investing and expanding. This comes after the company is now manufacturing and bottling Pepsi brands at full capacity following a $40 million investment.
Varun Beverages is a subsidiary of RJ Corp, an Indian company, which is the largest bottler of PepsiCo products outside the United States.
Giving the keynote address at the official launch of the plant, President Emmerson Mnangagwa said the investment by Varun, which was initiated in 2013 when Zimbabwe was inward looking, was in sync with the National Development Policy objective or re-equipping, replacing and modernising the country’s industry.
“I am inviting local and foreign investors to bring t capital and join the journey into the “New Zimbabwe. This investment supports the economic objective of Zimbabwe becoming a middle income economy by 2030 through job creation and product affordability.”
He however said that Zimbabwe should not just expect investors to come only for them to be taxed by Treasury. “It is my belief that you will have more companies coming to this country if you give them incentives and tax breaks. I know you (Finance Minister Patrick Chinamasa) will not agree with me,” he said.
President Mnangagwa said Varun should grow production to meet local demand and look to gain ground on the regional front.
In addition, Varun Beverages will be spreading its tentacles into agriculture processing and tourism following its successful launch of a $30 million soft drink beverages plant in Harare.
RJ Corp chairman Ravi Kant Jaipuria said with future revenue and profits generated from the sale of carbonated drinks, the firm is already looking at avenues of re-investment in the agro-processing sector and agriculture.
“With the future revenue and profits generated from the sale of carbonated drinks we are already looking at avenues of reinvestment like potato processing, tomato processing, juices, dairy, education, healthcare and hospitality, hence further supporting the Zimbabwean community. We will soon be expanding into preforms (backward integration) and juices production,” said Jaipuria.
With this new expansion, the company will export preforms and juices to Zambia, Botswana, Mozambique and other neighboring countries, which will bring in sizeable foreign exchange into Zimbabwe.
Jaipuria said, “Further to our expansion program I would like to briefly discuss one area of immediate interest in slight detail which is Potato Processing.Agriculture is a significant sector of any economy.”
He said the company has an agro based project for producing “Potato Chips” and in the project being mooted they will be partnering with local farmers which shall generate direct employment to more than 600 farmer families.
In addition, the firm will be supporting farmers with specialised extension services for growing right quality of potatoes. A special variety of seeds will be developed with the help of latest technical knowhow keeping in mind the local weather and soil quality. With the help of this farmers will be able to get better yield and productivity and the final product which will be suitable for processing.
The project will employ about 150 people directly and many hundreds more through the supply chain.
Varun Beverages is also looking at exports of the processed potato products to Zambia, Tanzania, Malawi, and Mozambique.
On the beverages business, the chairman said they want to expand their packaging and production line for an additional $10 million by October this year.
