Yum Brands Bets on India's Young for Growth

Yum Brands Inc. is gearing up for a major expansion in India early next year, where the restaurant chain hopes to position KFC and Taco Bell as youthful, hip brands in a nation of young consumers.

The move comes as the Louisville, Ky., chain is struggling in the U.S. and sales in China, where Yum has expanded for 22 years, are slowing.

The restaurant industry has intensified its focus on overseas markets in the last decade as the U.S. has become saturated with fast-food chains. Emerging markets are becoming more important for global chains as the recession has taken its toll on restaurants here. NPD Group on Monday predicted that U.S. restaurant industry sales will remain weak through the first half of 2010.

Yum's India push will put it in a race for the appetites of consumers in one of the world's most populous countries. Yum currently lags its big U.S. rivals. It operates 72 KFCs in India, compared to McDonald's Corp.'s 170 outlets. It has 158 Pizza Huts there while Domino's Pizza Inc. has 274 stores. Yum plans a total of 1,000 restaurants in India by 2015, generating about $1 billion in annual revenue.