Beverage giant Coca-Cola witnessed a fall in its market share (by value) in the country during the January-March quarter despite a double-digit volume growth riding in high demand for smaller and cheaper packs.
In its quarterly results announced on Tuesday, Coca-Cola said its global volume growth was led by India, China and Brazil.
For Asia-Pacific, it said, “Value share in total NARTD (non-alcoholic ready-to-drink) beverages for the company was even as gains in the Philippines and Japan were offset by declines in Indonesia and India.”
This decline signals the company now gets a smaller share of the total revenue earned by all companies selling non-alcoholic ready-to-drink beverages in India.
In Asia-Pacific, Coca-Cola’s net operating revenue was down 4% to $1.42 billion during the quarter.
Amid increasing competition, the Atlanta-based company has been taking price cuts in some packs in India and has also introduced cheaper packs.
In November last year, Coca-Cola slashed the price of its 400 ml PET bottle by `5 to `20. This was in response to Campa Cola’s 500 ml bottle price.
This year, it has also introduced `10 packs for light and diet variants of Coke, Thums Up and Sprite. Similar launches were also made by its rival PepsiCo after Reliance Consumer’s Campa introduced `10 packs in the market.
Cheaper packs allow the companies to avoid price cuts on bigger packs.
“In India, we had strong volume growth across our portfolio of global and local brands,” said the company’s chairman and CEO James Quincey, during an analyst call after the announcement of quarterly results.
He added that the company added 350,000 outlets in the country during the quarter and around 100,000 customers to its digital customer platform.
The volume growth in India was mainly led by Coca-Cola and Thums Up. The company also recorded around 180 million servings during the Maha Kumbh Mela held from January 13 to February 26.
Notably, India is the fifth largest market for The Coca-Cola Company. The company has three billion-dollar brands here – Maaza, Thums Up and Sprite.
Globally, however, the company reported healthy growth in revenue and profits and maintained its full-year organic revenue and comparable profit forecasts. It is also relatively safer from the ongoing volatility due to tariffs as most of the production for the US takes place domestically, unlike PepsiCo which makes the concentrates for the US market in Ireland, which has now been subjected to a 10% reciprocal tariffs.