Major fast food giant eyes growth outside of U.S.One of the world's largest food companies is eyeing India as it works to maintain its torrid pace of growth.

Reuters reports that Yum Brands Inc. is hoping to repeat its success in China as it enters India, home to one of the world's fastest-growing economies. Yum, the parent company of KFC and Pizza Hut, has increasingly relied on China as a source of net income, with the world's second largest economy currently contributing more than 50 percent of total company profits.

Yum executives are betting that they can continue their win streak in India, aggressively charting growth in the Far East nation. The company is targeting Indian students and members of its burgeoning middle class in its latest effort, as it works to compel Indians to spend more money on classic American staples – with decidedly Indian influences.

There are millions of vegetarians in India, which is one of the many obstacles Yum faces on the path toward market dominance there. The company must also ensure it is abiding by procurement best practices and paying close attention to the strategic sourcing of food products. The opportunity to expand its business in India is so significant that Yum is hoping to avoid any kind of bad public relations debacle that could turn off potential customers to its stores.

As it did in China, Yum is endeavoring to rapidly grow its restaurant base in India. In total, the company plans to have at least 2,000 eating establishments in India by 2020. The goal is exceedingly ambitious as it only currently operates 374 stores, but analysts said the food giant is capable of expanding at such a quick pace, citing its success in China, the U.S. and elsewhere.

"I look at India as the most dynamic market for us in the 21st century," Yum chief financial officer Richard Carucci told the news provider recently.

Experts say the path toward increased profitability and exposure in India will likely differ from its success in China, however. Yum opened its first KFC in China in 1987, and its growth in the country was largely uninterrupted over the next few decades. It now operates more than 4,500 stores in China and earns a substantial return on investment, underscoring how deft supply chain management can enable a multinational firm to succeed.

Yum has already undertaken steps in India that will help focus its attention on driving sales and earnings gains. The company has separated its Indian segment from its core international unit, allowing it to report its own separate financial results. Yum's bold strategy in India is prompted by the continued strength of its economic ascent and demographics.

Although China's population is quickly aging, India – currently the world's second most populous country – is markedly younger. In fact, 60 percent of India's 1.2 billion people are under the age of 30, an age group that is the bread-and-butter of the fast food restaurant industry.

Moreover, Yum is bullish on India because Indians spend less on fast food than their Chinese counterparts. With the nation's economic growth rate forecast to surpass that of China within the decade, that figure is expected to rise precipitously.

While there are certainly challenges facing Yum in India, the company is prepared to combat them as it looks to continue its streak of expanding in untested markets. Yum executives have largely brushed aside criticisms over the company's growth plan, noting it faced the same kind of opposition when it first entered China. That bet worked out for them, and the company is confident its expansion in India will, too.
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