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Wednesday, May 21, 2003

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DS Foodsto stir up bottled water segment

P.T. Jyothi Datta


THERE is a new flavour in the Rs 1,000-crore bottled water segment - as Catch `clear flavoured water' from the DS Foods stable hits the marketplace in the Capital, with a plan for roll-out in the metros in another three months.

Though the product is new in the domestic landscape, flavoured water has been available in global markets - and DS Foods is currently also testing the waters in the European market.

With the intention of providing more than just plain water in the domestic market, the new product comes in three flavours - Lemon-lime, Black Currant and Peach and is priced at Rs 15 for a 350 ml bottled and Rs 25 for 750 ml. The launch comes at a time when the packaged water industry had seen a whirlpool of activity following studies that alleged the presence of pesticide residue in bottled water.

However, Catch's `clear flavoured water' would circumvent the current fluidity on the residues issue, since it would not have to sport the ISI logo, the Government certification mandatory for bottled water. Instead it would sport the FPO logo, another endorsement from the Government, given to products adhering to parameters in the Fruit Products Order. The FPO certification is usually found on soft drinks and other fruit-based food products.

Confirming this to Business Line, Mr Ashok Aggarwal, Vice-President - DS Foods, said Catch `clear flavoured water' would sport the FPO order and not the ISI mark. Further, he pointed out, that the water adhered to norms prevalent in other developed markets and the new product was now being test marketed in the European market.

Unwilling to put a figure on the sales expected from the new product, he said that the initial market feedback had been encouraging. Admitting that the product would be in the high-end segment, "the economics of the business would depend on the volumes," he said. Catch's flavoured water is being rolled out of its existing plant in Himachal Pradesh and the product is targeting both retail and institutional sales.

Unlike the new Catch product, other innovative products like sparkling water from Nestle and Danone have not been as lucky. Imports of products like Perrier and San Pellegrino from Nestle and Farrarelle from Danone had to be discontinued, when the Centre insisted that they adhere to ISI norms, though worldover norms are different for bottled water and water in its other forms. Carbonated water or sparkling water had hoped for some reprieve when the existing norms were reviewed in the context of the pesticide controversy.

However, when last heard, the Centre had got its response from the packaged water industry on its draft notification that laid out parameters for pesticide residue. But with the Centre dragging its feet on the final notification on bottled water - companies may have to come out with innovative products like flavoured water to stir up the bottled water segment, industry-watchers point out.

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