Gurugram: PepsiCo India Holdings Pvt. Ltd reported an 8% rise in consolidated revenue to ₹9,798 crore for calendar year 2025, while net profit rose 4.5% to ₹905 crore.
The company’s foods business grew 11% year-on-year, PepsiCo India management told reporters at a press briefing on Tuesday, although the company did not disclose revenues for the segment. Management said innovations in premium snacking helped boost topline growth, while unseasonal rains during last summer hurt growth in the beverages business.
“Last year, we launched with Kurkure a “jowar puff”, which is not a national product but a very localised, traditional product,” Jagrut Kotecha, chief executive of PepsiCo India and South Asia said at the briefing. “Same thing in beverages, we realised hydration is a big space along with energy (drinks). That’s when we accelerated our portfolio on Nimbooz (lemon drink brand).”
PepsiCo also launched premium chips brand Red Rock Deli in November last year.
“These numbers also had the exceptional effect of the Wage Code (New Labour Code) that came into effect last year,” Savitha Balachandran, chief financial officer of PepsiCo India and South Asia, told reporters, “So if you do take away that impact, then you will see the margins are very much in line with what the topline growth has been.”
On the beverages front, there were some headwinds as far as the weather was concerned, while competition intensified, Balachandran added. “But we are pleased to see the price pack interventions we took helped us to hold on to our revenue profile.”
Last year, Mukesh Ambani’s Reliance Consumer began expanding its soft drink brand from smaller towns to bigger cities, undercutting market leaders PepsiCo and The Coca-Cola Company with a 200 ml PET bottle priced at just ₹10.
Hot summer, cool inflation
PepsiCo India expects beverage to be better this year as several parts of the country face heatwaves while a potential El Niño event may lead to weak monsoons.
“We have not seen our demand signals weakening yet,” Kotecha said. “So that is good news for us.” However, he added, that everyone must accept a “new reality” where disruptions are the norm and companies must be prepared to review 3-, 6-, and 9-month plans over annual operating plans.
PepsiCo has not hiked prices yet, Kotecha said, adding that only palm oil prices may be a risk because the packaged food industry in India imports much of it.
Packaged consumer goods companies have been steadily hiking prices this quarter as costs of key raw materials rise. Just this month, major milk cooperatives hiked prices of milk by ₹3-4 per litre, while some packaged bread brands raised rates in big cities. Meanwhile, the government hiked prices of petrol and diesel twice already this month; first by ₹3 a litre and then again by 90 paise within days.
However, beverage makers and analysts tracking the sector are not worried for now.
“The company remains bullish on domestic demand with no expected adverse impact from inflation,” analysts at brokerage firm Motilal Oswal wrote of Varuni Beverages, PepsiCo’s largest bottler outside the US, in a note late last month.
“Strong traction in new launches such as Nimbooz (~60% growth) and Tropicana (100% growth), along with the anticipated El Niño-led heatwave, is expected to further boost beverage consumption and support a strong near-term outlook,” the note said.
“Encouragingly, India volume growth increased 14.4%, led by initiatives such as pack upsizing, selective price-point launches in identified markets to onboard new consumers, and new launches in the energy- and juice-based drink segments,” analysts from brokerage firm Emkay Securities tracking Varun Beverages wrote in a note late April. “New launches like A-Rush and Sting Classic are seeing strong traction, with better than expected demand, though aluminium-can shortage remains a constraint.”
However, with crude prices climbing steadily due to the , prices of plastic packaging including PET bottles, crucial for the beverages business, could also come under pressure, hurting margins.