Urban consumption, rising health consciousness, less entry barrier to the industry and availability of bulk package are boosting demand for bottled water. The category is estimated to touch Rs 10,000-crore mark in 2012-13.

While global bottled water market increased by 40-45 per cent over the past five years and is currently valued at $85-90 billion, the Indian bottled water market is around only two per cent of global bottled water.

According to a research by Ikon Marketing Consultants, bottled water market in India is growing at 19 per cent annually. In terms of volume, the demand was estimated at around 532 million cases of small packs.

The study points that the market is dominated by both organised and unorganised players with as much 80 per cent of the market being in the hands of the organised players and rest with unorganised.

Bisleri continues to hold leading position with as much as 36 per cent of the market share among the national players. Kinley, Aquafina, Oxyrich and Kingfisher are other pan-India brands.

Mr Ramesh Chauhan, Chairman, Bisleri International, notes that, “It is a lifestyle choice. The growth is coming from both urban and tier 1 and two cities primarily driven by growing health awareness and also disposable incomes.”

The market, according to the study, is shared by three types of players, national brands having pan-India presence worth around Rs 4,000 crore, region-specific local brands that are manufactured by registered plants but serving into region-specific market worth around Rs 2,400 crore and the unorganised local brands that are manufactured in homes usually in bulk and pouch packing, having turnover of around Rs 1,600 crore. There are more than 2,500 brands, nearly 80-85 per cent of which are local.

Non-traditional category or bulk packs (more than 5 litres) is gaining grounds by acquiring almost 44 per cent market share while 20 litres jar is new the icon for pan-India player.

“Rising trend of bulk water consumption in homes and institutional segments will pave the way for bulk water pack to acquire half of the total bottled water market in next 4-5 years. The major growth contributors will be the mushrooming growth of bulk water pack suppliers due to less entry barriers to the industry and almost negligible cost of industry exit, range bound supply and the continuous rise in population with inadequate drinking water facilities,” Mr Taruna Sondarva, Senior Consultant at IKON, said.

South India is the biggest consumer of bottled water representing more than 50 per cent of the total market followed by West.

Currently, small packing are holding maximum market share due to easy affordability and availability. However, in recent years the institutional supply is picking up with supply of bulk packs. Meanwhile, rising environmental concerns and high transportation cost along with difficulty in brand recognition are proving as major bottlenecks for Indian bottled water market.

>bindu.menon@thehindu.co.in

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