Coke's sale down by low single digit in Jan-March

Venkatesh Kini says the firm is gearing up to launch first juice-based carbonated drink in India

Beverages major Coca-Cola’s sales dipped by a “low single digit” during January-March 2017 in the India and South-West Asia region. 

While the firm posted an 11 per cent growth rate in India during the same period last year, the last quarter’s performance in the region impacted its sales in the Asia-Pacific region, the company informed the New York Stock Exchange on Tuesday.

“Unit case volume growth of 1 percent included low single-digit growth in our Greater China & Korea and ASEAN business units, partially offset by a low single-digit decline in our India & South West Asia business unit”, it said in the regulatory earnings release. 

Questions on details of its quarterly results sent to Coca-Cola India remained unanswered till the time of going to press. 

During 2016-17, Coca-Cola’s performance in the region, in terms of sales in volumes, remained muted. While it started the year with three percentage point progress in volumes in April-June, it remained below par as summer months account for nearly 40 per cent of branded cold beverages sales in the country. 

During July-September 2016, its sales declined by four per cent. (The firm did not reveal the October-December numbers for India.)

Last year, declining sales reflected in its financial results. During 2015-16, Coca-Cola India’s sales remained flat at Rs 1,757 crore and profit declined six per cent year on year (y-o-y). 

Hindustan Coca-Cola Beverages, the company-owned bottler that produces nearly 65 percent of its drinks by volume, reported a 28 per cent plunge (y-o-y) in profit — from Rs 241 crore to Rs 174 crore.

To catch up with the growing trend of consumers choosing non-carbonated drinks in the country, Coca-Cola has taken up a project to revamp its non-fizzy drinks portfolio. 

In the past two years, the firm launched a number of products and brands including Vio (a milk-based drinks brand), Zico (packaged coconut water), and new variants under its juice brand Minute Maid. It is also working to strengthen the less-sugary drinks portfolio by introducing Coke Zero.

According to Venkatesh Kini, president, India and South-West Asia, Coca-Cola, the firm is gearing up to launch the first juice-based carbonated drink in India in next few months. “Adding juices to our existing carbonated beverages is the current focus area. Coming up with a completely new product in that front is less attractive as it takes more time. So, we are working on options were we take an existing brand and add juice to it. We will accelerate product launches in the next three years compared to the past three years,” Kini told Business Standard in March. 

The firm is working on displaying sugar content in its drinks on labels to offer consumers the option to choose healthier alternatives. These are part of Coca-Cola’s efforts globally to cut down sugar content in its drinks and expand its portfolio.