MUMBAI : SLMG Beverages, which accounts for over 22 per cent of Coca-Cola’s volumes in India, said it may be forced to increase prices if it is unable to absorb the rising costs of packaging materials linked to the Middle East war. Key inputs such as plastic bottles, caps, labels, and cardboard boxes have all seen cost pressures, with some packaged water manufacturers already hiking prices.
Rahul Kumar, Deputy CEO of SLMG, noted that continued conflict could further escalate packaging costs. He added that any decision to raise prices would depend on multiple factors, including competitor strategies and consumer response in an already price-sensitive market.
The warning comes at a time when India’s soft drink sector is witnessing heightened competition. The re-entry of Reliance Industries into the beverage space with the revival of the Campa brand in 2023 has intensified a price war, leaving limited room for companies to pass on increased costs. Kumar highlighted that there has been no portfolio-wide price increase in the past seven to eight years, with a review expected in April.
Despite these challenges, SLMG remains optimistic about long-term growth. The company plans to invest between ₹10 billion and ₹12 billion in each of four new plants over the next five years to expand capacity. This aligns with projections from Redseer Strategy Consultants, which estimate that India’s non-alcoholic ready-to-drink beverage market could double to $40 billion by 2030.
SLMG reported strong financial performance in fiscal year 2025, with sales rising 49 per cent to ₹67.73 billion and net profit increasing 76 per cent to ₹2.06 billion. Looking ahead, the company is targeting net revenue of ₹100 billion by 2026–27, driven by expansion into high-population, lower-income states such as Bihar and Uttar Pradesh, where rising incomes and low consumption levels present significant growth opportunities.
SLMG Beverages, a major player in India's soft drink market, warns of potential price hikes due to rising packaging costs linked to the Middle East conflict. With competition intensifying, the company faces challenges in passing on costs. Despite this, SLMG plans significant investments to expand capacity, aiming for long-term growth in a market projected to double by 2030.