Hindustan Coca-Cola testing 20 local products – The Hindu
Hindustan Coca-Cola Beverages, the largest bottling partner of the Atlanta-based Coca-Cola Company, plans to open its ₹450-crore facility in Sanand in Gujarat by January as it tests more than 20 new products made locally in a bid to make India among its top three global markets, Christina Ruggiero, CEO, said on Wednesday.
“We will be kicking off shortly our next new greenfield facility in Sanand in Gujarat in the last week of December or first week of January,” Ms. Ruggiero told correspondents in Bengaluru, where its corporate headquarters is situated. “The phase I of the project is estimated to cost about ₹450 crore. It will have lots of green initiatives, automation and robotics involved.”
It will have multiple bottling lines for carbonated beverages such as Coca-Cola, Sprite, Fanta, Limca, Thumbs Up, juices and juice-based drinks like Minute Maid, Mazza, and, bottled water and Kinley soda.
According to Euromonitor International, increasing health awareness among consumers and their preference for health and wellness products are the likely reasons for strong growth expected in juices. Carbonates, both cola and non-cola carbonates, were likely to see sustained slowdowns in volume growth rates, according to an April report.
India’s food industry is estimated at ₹14,500 crore. The non-alcoholic beverages market is worth about $5 billion, according to Indian Beverages Association. The health beverages market is $300 million and is the fastest growing. The fruit drinks market is ₹6,000 crore.
“Aerated and carbonates are actually growing,” Ms. Ruggiero said. “It is an interesting thing because aerated and carbonated from an industry standpoint is growing. It has grown about 5% in India. It accounts for 60-65% of our business. Our aspiration is to have double-digit growth. Prior to my coming in July, we were having a single-digit growth. After July, we are seeing double digit growth.”
‘Local products work’
“In India, local works. Different customers need different products. Hopefully, the next will be mosambi (sweet lime). Juice industry in India is seeing explosive growth as more Indians are switching from fresh to packaged juice. More Indians are entering the non-alcoholic, ready-to-drink segment,”she said. “We will be pushing the existing factories to see how to make new juices, carbonated drinks and new products.”
The company makes carbonated drinks, juices, packaged water, milk-based drink Vio, value-added water and also sells tea and coffee.
“We currently have a pilot project running in Bengaluru called Perfect Fruit. It is just 25 machines and we are doing a test to see how it goes. Local fruits we buy to make our juices go in to a machine and is turned into frozen fruit. No sugars but just the fruit.”
If it works, the company will introduce a combination of local fruits in other markets, she said. “I have a pipeline or ‘fantasy list’ of 220 products across all regions and flavours. Only a small percentage of it may work. Typically, 5% of these ideas may work,” Ms. Ruggiero said.
“Out of these 220 products already 20 are in various stages…they are in different parts of India.” Part of the reason why Coca-Cola did not succeed much in India was that it did not have the right product at the right price point, she said. “First half of the financial year we struggled,” Ms. Ruggiero said.
Hindustan Coca-Cola manufactures, package, sale and distribution of beverages under the trademarks of The Coca-Cola Company. It owns and operates 21 factories and has a network for 4,000 distributors and more than 1.9 million retail outlets.
On Wednesday, the company announced plans to source 40% of its energy requirements using renewable and clean energy fuel, before the end of 2018. It will procure 30 million units of solar power per year from Atria Solar Power. It also inaugurated its CNG-based boiler system at its factory in Bidadi, near Bengaluru.