PepsiCo has announced its business strategy to become China's leading consumer-centric food and beverage company. After the company acquired the Chinese firm Be & Cherry, PepsiCo further claimed that it wants to capitalize further on the global health food industry.
According to CNN, PepsiCo's acquisition of Chinese food and beverage company Be & Cherry marked its further capitalization on the Chinese market. The report claimed that the company wishes to become the country's leading consumer-centric food and beverage company through acquisition and bringing in more investments.
PepsiCo's latest investment in China came at a time when business activity in the country was undergoing depression due to a public health crisis. Chinese officials, however, have urged workers in the country to purchase goods through online means as a more appropriate remedy to acquire their daily necessities.
Be & Cherry, a Hangzhou-based food and beverage company, sells nuts, dried fruits, and similar items online. At present, it is valued at 705 million USD. It was reported to have generated a profit of 171 million Yuan in 2019. The said value accounted for a 32 percent rise compared to 2018 values.
The report also highlighted that the acquisition came after the closure of PepsiCo of its production factories in China. The shutdown was effective in late January this year that caused several delays and sales losses for the company.
PepsiCo had been operating in China for decades and has improved its company revenue in the region by constantly engaging in trade deals there. In 2019 alone, Pepsi also acquired China's largest natural food producers and as been opting to capitalize on the global health industry.
The Chairman and chief executive officer of PepsiCo Ramon Laguarta discussed with investors during an earnings presentation the critical opportunities available in China. He claimed that the country has a huge market that suggests PepsiCo could maintain constant revenue growth in the coming years.
In other news, it was revealed that PepsiCo's stock went up by 0.48 percent or 0.69 points. Its previous closing price was at 145.16 USD, but the stock reached 145.85 USD during the last trading session.
In the last five trading sessions of the week, PepsiCo's share price has increased twice and only lost once by 0.42 percent in the last seven days. The company has also been reported to generate considerably more profit after expenses compared to its market competitors. The company's return on capital was also set at 22.32.