Financial Daily from THE HINDU group of publications
Wednesday, Mar 30, 2005
Corporate - Diversification
Pepsi India to expand portfolio, foray into breakfast segment $300-500 m investment planned
Ms Indra Nooyi , President & CFO, PepsiCo
New Delhi , March 29
FLORIDA oranges and tangerines could well be the next crop to pervade fields of Punjab if Pepsi India's partnership with the Punjab Government bears fruit.
Though the project to cultivate table varieties of citrus fruit through the company's contract farming model is more for self-consumption in manufacturing of brand Tropicana, there is no ruling out the fact that if the project takes off, it could, in the future, add to Pepsi India's growing exports portfolio.
The President, Chief Financial Officer and member of the board of directors, PepsiCo, Ms Indra Nooyi, who is on a business trip here spelt out investments, proposals and the direction the company's Indian operations are likely to take.
Putting future investments in the country between $300 million and $500 million, she detailed what PepsiCo had in store for the Indian consumer in the coming year.
For now, the company is planning to expand its basket to give the consumer more purchase choice in increased segments. It is not only looking to add to its beverages and snacks portfolio, but will introduce itself in the breakfast segment for the first time.
So what's on the Pepsi menu? Rising temperatures in the next few months will ensure that the company spreads its Lipton Iced Tea distribution across the country. Then will come the manufacturing of sports drink Gatorade in the country, for the niche fitness market seems to have accepted the product.
However, it is with Quaker breakfast products that the company plans to make its big splash as it is looking at not only oat mixes and hot breakfast cereals, but other breakfast products, including bars and twists.
The beverage portfolio, especially juice products are also likely to see more launches, with the `good for you' product category going in for fortified mixed juices, while Diet Pepsi may be marketed more aggressively as a `better for you' product.
"The `fun for you' category (which largely comprises carbonated drinks) has grown by 6 per cent, while the calories in this section have declined by 7 per cent," said Ms Nooyi, as she reiterated that Pepsi products in India meet the company's global standards.
There is no getting away from the fact that Pepsi's biggest snack success story has been the India-generated Kurkure brand. "It is the most talked about brand and has generated great interest in the US, the UK, South Africa, Australia and West Asia we are testing it and will be targeting it as the walkers brand in countries with large non-resident-Indian presence," said Ms Nooyi.
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