In the September quarter, Indians guzzled more colas, juices, and fizzy drinks, cheering drink businesses that saw their peak season sales wiped out in summer by the lockdown of the coronavirus.
Parle Agro Ltd, which sells Appy Fizz and Frooti drinks, said that during the months of June-July, the company saw a “significant recovery and pick-up in sales,” as more stores opened up and consumers stepped out more frequently.
“In the months from August to October, sales growth further accelerated with our brands crossing last year’s sales figures over the same period,” Nadia Chauhan, Joint Managing Director and Chief Marketing Officer, Parle Agro, said in an e-mail. Parle Agro expects to see 5-10 percent higher sales than previous sales in 2020, despite the loss in summer sales.
Sales of fizzy and still beverages, over half of which are consumed outside homes, were crushed by the lockdown. While in-home snacking benefited significantly during the period, like restaurants, schools, and transport remained closed, beverage sales dipped. Many beverage manufacturers have attempted to transfer in-home consumption through small and family packs. Consumers wary of catching a cold, however, avoided chilled drinks.
In the second half of the September quarter, Varun Beverages Ltd, which bottles and distributes Pepsi, Mirinda, and Mountain Dew carbonated drinks for PepsiCo, reported a ‘healthy recovery’ in domestic demand. In rural and semi-urban areas, the recovery was driven by demand.
Demand for beverages has clearly seen a good quarter-on – quarter recovery. “This is driven by small unit packs and higher rural penetration for some businesses,” said Aneesh Roy, Executive Vice President, Research, Edelweiss Securities. Roy said consumers are diversifying their consumption of packaged food and beverages, moving beyond cookies and snacks.
Recently, Parle Agro, which sells Frooti and Bailey water, launched new malt-flavored fruit beverage B-Fizz after the covid-19 induced lockdown wiped out peak summer sales for the top beverage manufacturers in the country.
Sales of Coca-Cola are inching back to normal, even as it warns that near-term results could continue to muddle with a resurgent virus.
In the third quarter, global unit case volume decreased 4 percent as the restaurants and entertainment venues that make up about half of revenues are not yet back to normal. Still, when volume fell 16 percent, that’s far better than the second quarter. The problems in public spaces have helped offset some increase in at-home consumption.