NEW DELHI: The carbonated drinks market in India is witnessing intensifying competition, with Coca-Cola, the country’s largest cola company, warning that it may have to cut prices or spend more on marketing to defend its market share against new entrant Campa, the cola brand owned by Reliance Industries.
Hindustan Coca-Cola Holdings (HCCH), Coca-Cola’s largest bottler in India, has highlighted these risks in the draft red herring prospectus (DRHP) for its proposed initial public offering (IPO). The company recently filed the DRHP with the Securities and Exchange Board of India (Sebi).
The IPO will comprise an offer for sale of up to 99.75 crore shares by Coca-Cola’s holding arm, Hindustan Coca-Cola Overseas Holdings. HCCH is owned 60% by Coca-Cola, through its subsidiary Hindustan Coca-Cola Overseas Holdings, and 40% by the Jubilant Group. Coca-Cola is selling a 15% stake in the company, which will reduce its holding to 45% post-IPO.
In the DRHP, HCCH says players such as Reliance Consumer Products (RCPL), through Campa, and regional beverage companies are expanding their presence by offering products at competitive price points.
Intensifying competition, it warns, could force it to reduce prices or increase marketing expenditure, putting pressure on profitability.
According to the DRHP, RCPL reaches more than 3 million retail outlets through over 5,000 distributors, with beverages manufactured at around 18 facilities through co-investment partnerships across 12 states. Another major competitor in the non-alcoholic, ready-to-drink category is Varun Beverages (VBL), PepsiCo’s sole bottler in India.
HCCH, according to the IPO document, reaches around 1.7 million outlets through 2,273 distributors, while VBL has a distribution network covering more than 4 million outlets.
The DRHP also flags rising cost pressures in the mass-market segment of the beverage industry.
Sharp increases in PET resin, aluminium and sugar prices are squeezing margins on products sold at fixed price points such as Rs 10, Rs 20, and Rs 30. Carbonated beverages also attract an effective GST rate of 40%, among the highest for packaged food and beverages.
Despite growing competition, Coca-Cola remains dominant in HCCH’s territories. Coca-Cola India brands commanded a 60.1% value share of the carbonated soft drinks market in HCCH’s southern and western territories in the 12 months ended June 2026.
With competition intensifying in the lower-priced segment of the market, Coca-Cola has been forced to move further down the price ladder. It has expanded its portfolio of Rs 10 packs across 150 ml, 250 ml and 500 ml sizes and plans to introduce more products in its lightweight ASSP (Affordable Small Sparkling Package) bottle format.