The investment bank, Merrill Lynch, has begun its coverage of the Mexican soft drinks bottler, Embotelladoras Arca, with a "buy" rating.

"In our opinion, Arca is among the most attractively valued Coke bottlers in the world," Merrill Lynch said.

Arca, Mexico's second largest bottler of Coke brands, was formed in 2001 when three bottlers merged in a bid to compete with the dominant force, Coca-Cola Femsa.

The company posted a net profit of MXN1.264 billion (US$119m) on sales of MXN13.192m (US$1.25 billion) last year.