As of now, no foreign companies are allowed to list in China’s domestic stock exchanges.  China had indicated earlier in 2009 that it would eventually allowed qualified foreign companies to list in Shanghai, with rules and regulations that have yet to be announced.

Currently, Coca-Cola share price ($68.75 as of July 7) is enjoying a gradual upward climb towards its record high of US$88 a share reached in 1998.  Chief Executive Officer Muhtar Kent is continuing the corporate strategy started by his predecessor E. Neville Isdell to refocus the company more on its core products, which include Coke, Diet Coke, and Coke Zero, rather than on its other noncarbonated drinks.  Kent also reconfigured serving sizes globally and introduced minicans and smaller bottles with new pricing to meet consumer demands and boost profit margins.  In 2010, Coca-Cola purchased its largest franchised bottler in Atlanta, essentially bringing it in-house to cut supply-chain costs, and giving the company control of 90% of its North American distribution.

As close to 80% of Coca-Cola’s sales are done outside the United States, Kent plans to spend at least US$27 billion through 2020 for new bottling and distribution facilities in emerging markets such as China and Mexico.  Last year, the company opened three bottling plants in the Inner Mongolia region at a cost of about US$246 million, part of the company’s three-year, US$2 billion expansion plan in China.  A Shanghai listing seems like a logical extension of Coca-Cola’s plan as it would provide access to China’s huge local currency deposits as well as increase the already strong brand value of the best selling soft drink in the world.

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In 1977, Coke pulled out of the Indian market because it refused to comply with then government regulations which would essentially force it to form a partnership with a local company and to share its secret Coke formula. In 1988, PepsiCo formed a joint venture with 2 Indian companies and in 1990 introduced its signature cola under the Lehar Pepsi brand. Coke re-entered the Indian market in 1993 when government regulations had changed to allow foreign companies to operate without local partners. Coke’s complete absence from India during a time when India began to embrace Western products was a strategic mistake. Pepsi’s crucial timing and its presence in the Indian market without its main competition had basically made Pepsi into a household word… a word synonymous with the carbonated cola drink category. Sales of PepsiCo’s wide range of products in India, including Frito Lay chips, Tropicana juices, Gatorade drinks and Quaker Oats, totaled $1.5 billion in 2009.

India born Indra Nooyi, PepsiCo Inc. (NYSE: PEP) Chairman and CEO, has stated that she will invest aggressively in emerging markets and will continue to pursue strategic costs-cutting opportunities. Her recent completion of the purchase of PepsiCo’s 2 largest bottlers assured investors of her intentions. PepsiCo’s stock is up 12% since September 2009 and its revenues are projected to be $60 billion for 2010.

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