Milk it! Coca Cola plans to re-enter dairy business

Coca-Cola India has been making efforts to expand its beverage offerings.

New Delhi: After a failed attempt with flavoured milk Vio, Coca-Cola is still considering re-entering the dairy business, Coca Cola India President T Krishnakumar said.

The company had to take Vio off the shelves after 2016 launch as it did not do well in the market. The company may now relaunch the Vio brand, according to a report in Hindu Business Line.

Coca-Cola has been running pilots (with Vio) to finalise its strategy in the dairy space for some time, the report states. “We want to have a presence in every category, including the dairy segment, with focus on nutrition,” Krishnakumar said. The company has developed new producted under Vio brand, including a chocolate-flavoured variant.

The company did not comment on whether the company is going to bid for GSK’s Horlicks or Kraft-Heinz’s Complan. ITC and Hindustan Unilever are also considering purchase of Horlicks, media reports suggest.

Coca-Cola India has been making efforts to expand its beverage offerings. The company had three months ago launched nutrition dilutable drink called Minute Maid Vitingo priced at Rs5.

Coke eyeing more share than PepsiCo

  • On the global level, Coca-Cola topped Wall Street estimates for quarterly sales and profit, as more consumers bought its healthier soda options such as Zero Sugar and new flavours of Diet Coke.
  • Coca-Cola and its smaller rival PepsiCo Inc have been focusing on healthier drinks to garner major market share as health-conscious consumers shift away from sugary sodas globally. The company has launched new flavors of Diet Coke in a slimmer package and in the quarter introduced no-sugar beverages in smaller markets such as New Zealand, too.
  • Coca-Cola reaffirmed its 2018 profit outlook and said it expects full-year organic revenue to be at least 4 percent.
  • Talking about the company’s planned dairy foray, Krishnakumar, in May this year, said that the firm has tested the waters. “We have a lot of learning from whatever we have done and we have absorbed the learning. Now we are reformulating and working on a range which will have a better connect with the consumer. So you would see [us] coming out with a range of dairy products.” Coca-Cola reported double-digit growth in their revenue and volumes for the April-June quarter.

We had reached a stage where growth was not good, but in the last four quarters we have been able to slowly get the mojo back. We ended the second quarter (April-June) with double- digit growth in volumes and revenues. So overall we are seeing good growth momentum T Krishnakumar, Coca Cola India President

Fruit-based beverages

  • In February, the company unveiled its plans which included expansion of its fruit-based beverage offerings, frozen fruit dessert, getting into dairy based value-added products and also exporting products developed in India.
  • The company’s focus will be on ‘fruit circular economy’– enabling farmers to increase their yield, source pulp and launch fruit-based products, Krishnakumar said in February. The company was also planning to launch vegetables-based beverage like carrot juice.
  • Company would launch fruit juices based on the regional preferences. For instance, the company would launch mango juices based on mango varieties that are available and popular in a particular region.
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