BUSINESS

Thums Up, Kinley buoy Coke Q1 sales

By BS Corporate Bureau
April 19, 2003 14:23 IST

Coca-Cola has said the strong performances of its local cola, Thums Up, and bottled water, Kinley, helped it register double-digit growth in India in the first quarter of 2003.

"Our strong performance was driven by double-digit growth in China, the Philippines, India and Thailand. Trademark Coca-Cola and Fanta continued to drive the growth in many key markets, along with strong performance of local brands such as Thums Up, Qoo and Kinley," the company said in a statement issued in the United States on Wednesday.

A Coca-Cola India spokesperson said the company is not in a position to reveal the volume growth figures yet.

But he agreed that volumes grew double-digit during the first quarter. In the whole of last year, volumes grew over 20 per cent.

Market sources say Coca-Cola's volume growth has been high this season as consumption shifted towards the smaller 200 ml returnable glass segment, and the company was prepared with adequate cases of small pack sizes for the summer.

The company's market penetration has also increased as a result of the launch of the small size returnable glass bottles.

Also, at the beginning of the year, Coca-Cola brought down the price of its 200 ml bottle size to Rs 5, from Rs 10, dealing a blow to rival Pepsi which by virtue of sponsoring the World Cup cricket had high visibility in mass media and retail.

Coca-Cola said worldwide unit case volume increased 4 per cent in the first quarter, reflecting 3 per cent volume growth in North America and 4 per cent internationally.

In Asia, unit case volume increased 8 per cent for the quarter, cycling 9 per cent growth in the prior year first quarter. The beverage industry has not been immune to the weak global macroeconomic environment that has impacted many business sectors.

In addition to these factors, the beverage industry, including the company, was adversely affected by short-term external factors, including a slowdown in "away from home" consumption caused by the war in Iraq, a lengthy national strike in Venezuela, a change in deposit laws in Germany, and a shift in the timing of the Easter holiday.

Away from home consumption, however, makes a minority part of the business model in India. As much as 70 per cent of the consumption take place at the retail end, more than 90 per cent of this sales coming from the returnable glass bottle segment.

BS Corporate Bureau

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