The growth in the quick service restaurants (QSRs) sector has slowed down, and last year was challenging for soft drinks. The April-June quarter, contributing 35-40% of annual sales, was a washout due to heavy rains. However, the year ahead is expected to witness healthy double-digit growth for both businesses, according to Ravi Jaipuria, chairman of RJ Corp, PepsiCo’s largest bottler, and the leading franchise partner for KFC, Pizza Hut, and Costa Coffee in India.
VBL, a group company of RJ Corp and PepsiCo‘s primary bottling partner in India, is responsible for bottling and distributing a range of PepsiCo beverages. These include Pepsi, Pepsi Black, 7UP, Mirinda, and Mountain Dew fizzy drinks, as well as Sting energy drink, Tropicana juice, and Aquafina water. The distribution spans across 27 states and 7 union territories.
He emphasized the growth potential in India, citing lower per capita consumption and the extensive distribution reach of packaged soft drinks. “India has 11-12 million outlets for FMCG, and our beverages are in 3.5 million outlets only – indicating significant room for market penetration. Even with the addition of 4-5 lakh outlets per year, we foresee considerable growth upside,” stated Jaipuria.
Factors Driving Optimism for 2024 Soft Drink Growth:
Despite the impact of rainfall last year, he mentioned that VBL is expected to demonstrate a 13-14% annual growth for the entire year.
“We expect 2024 to be much better with healthy double-digit growth in soft drinks, because of category momentum, deeper distribution, electrification of villages which has made retail stocking of beverages more accessible, and additional capacity,” he said.
The company has announced plans for expanding capacities in juices and dairy, including the establishment of a plant in Jharkhand with an investment of INR 450 crore. With a present market capitalization of over INR 1.64 lakh crore, VBL stands as PepsiCo’s second-largest bottler globally, excluding the US. Additionally, VBL holds the franchise for PepsiCo products in Nepal, Sri Lanka, Morocco, Zambia, and Zimbabwe.
Continue Exploring: PepsiCo eyes fresh leadership amidst intensifying competition in Indian snacks market
