By- Rajeev SharmaMBA (2011-2013)DoMS, IIT Roorkee

Mapping the market for Packaged water and Packaged fruit juice in India

Agenda Executive summary Part A- Packaged Water Industry -Introduction -Market growth, major players, share, competition scenario -Product and pricing, market map (price VS. quality) -Industry competitiveness (internal and external) -opportunities and future outlook Part B- Packaged Juice Industry -Introduction -Market growth, major players, share, competition scenario -Product and pricing, market map (availability VS. fruit content) -Industry competitiveness (internal and external) -opportunities and future outlook

Executive summary Packaged water and Juice are still a urban concept to the Indian consumers, the industries

are in their growth stage, with the new advancement in packaging technology, introduction of new variants and entry of foreign players, this industry is booming. The industries have shown a growth trend with CAGR of 15%-25% in last few years.

This report attempts to study the following-MARKET STUDY- Packaged water and packaged juice in terms of major players, market

size, growth, share of players, segmentations and positioning of products available.

MARKET MAPPING- To identify the relationship between different variables pertaining to the product category and to identify the market gap and opportunities for new entrants or existing players to extend their product line. SWOT Analysis and competitor analysis in porter’s 5 forces framework

Packaged Water industry

PART 1

Perceived as new oil industry by 2025- Economic times

IntroductionBottled water industry, colloquially called, the mineral

water industry, is a symbol of new life style emerging in India. 

Large segment of the population is struggling to get access to safe potable water supply, a new generation - especially in the urban areas - is getting accustomed to bottled water paying handsome prices.

Artesian well water, daab water, mineral water, mountain water, spring water, tap water are some of variants

Market Growth

To grow to Rs 10,000 crore by end of 2013.

Growing at a CAGR of 19%, is expected to continue its growth momentum and grow over four-folds to Rs 36,000 crore by 2020.

CAGR- compounded annual growth rate

EAST

WESTNORTH

SOUTH

0

20

40

West leads-Segmenta-tion by Region

Segmen-tation by Region

4000cr2400cr.

1600cr.

Market dominated by na-tional brands

National brandsLocal recognized brandsunrecognized local brands

There are more than 2500 brands in this category and local unrecognized accounts for 3/4th of the total brands% Contr.

Urban 75%

Rural 25%

Largely urban centric

Market Share by recognized brandsMarket leader-Parle-Bisleri

Followers - Coca-cola’s Kinley & Pepsi’s aquafina.

Challengers- Parle Agro’s- Bailley Kingfisher Oxyrich Mc dowell’s no.1 and others.Niche's- Himalaya, Rail neer, Aava

36%

25%15%

6% 18%

Parle Bisleri holds the ma-jor share

Bisleri KinleyAquafina BailleyRest

Major Players

9

Other Players Mohan Meakin Mysore Breweries United Breweries NDOB Mt Everest

Golden Hello Dadi Group S M Foods Group Denone

Parle Bisleri

Kothari Beverages

More than 200 recognized brands….

10

Bailley

Stream

Golden Eagle

Penguin

Yes

Oasis

Kristal

Trupthi

Peppy Minerelli

Bisleri

Kingfisher

Pure Life

Kinley

Perrier

Aquafina

Evian

Golden Valley Stream

Himalayan

Pondicherry

Jaldhara

Ferra Relle

Packaging and Pricing

Packaging Market Pricing (in Rupees)

20 liters 60-755 liters 30-35 (Bisleri)2 liters 201 liter 10-15 500 ml 5-8330ml 5250 ml (cup) 3

Market Map for packaged waterHigh quality

Basic quality

Low

pri

ceH

igh Price

Local brands

Bisleri’s (>5ltr jars) Functional

& luxury water

Bottle in size<1ltr

SWOT analysisSTRENGTHS

More health, hygienic consciousnessStrong supply chain & logistics.Low entry barriers.Rise of tier 2, tier3 & rural areas.Changing demographics and consumer behaviorHuge untapped market

WEAKNESSLow capital intensive industry attracts new entrants.Low quality standards of unrecognized players- leading to low confidence in industry

OPPORTUNITIESIncreasing income of middle class families, tourismRise in demand of big water jars in office and office spaces.Increasing Organization of retail stores.Emergence of value added watersDifferentiated packaging and variants.

THREATSIntense competition from local manufacturers. Government regulations and pricing policiesEnvironment concernsIncreasing sales of water purifiers.

What is fueling this Industry growth?Increased On-the-go

behaviourHigher disposable income Importance of Hygiene

Affordable Price PointsIncreased Availability

7 Lakh 9 Lakh outlets

Industry competitiveness through PORTER’s 5 Forces model

THREAT OF NEW ENTRANT

BUYER’S POWER SUPPLIER’S POWER

THREAT OF SUBSITUTES

MODERATE LOW

HIGH

HIGH

INDUSTRY HIGH

RIVALRY

Opportunities and future outlook

Vitamin/ Mineral fortified Added fibre/ performance

enhancing ingredients Beauty ingredients Strengthen immune

system/ treat specific diseases

For diabetics

Functional WatersFlavored Water

Fruit flavoured

Natural Flavours

Sugar Free

Differentiated Packaging

Premium Packaging Appearance changing

More eco-friendly

Packaged Juice industry

Part 2

Gaining acceptance in India- The Hindu

Introduction

The fruit based beverages category is one of the fastest growing category, and is growing at a CAGR of 30% on the last decade.

Industry valued at around INR1500 cr., and expected to increase by CAGR of 15% over next 3 years.

Dabur, pepsico, coco-cola are largest market share holders

Divided into 3 subcategories-

Category

Fruit conten

t

Market

share

Examples

Fruit drinks

30% 60% Frooti, maaza

Fruit juice

100% 30% Real active

Nectar drinks

25-90% 10% Real cranber

ry

Market Growth

Time period Market growth

1990-91-1996-97

40.3%

1996-97 – 2001-02

16.1%

2001-02 – 2006-07

10.3%

2004-05 – 2009-10

9.0%

2009-10 – 2014-15

8.0%5.3 bn2004-05

7.4bn2009-10

10.902014-15

Demand in billion Rs. for fruit juices and concentrates

8%

7%2

0%

65%

Share by seg-mentation

North EastWest South

Source- ministry of food processing industry

Market Share by branded products Dabur leads the market with it Real

juice brands and enjoy a share of 50%

Pepsico’s Tropicana brand is the challenger in packaged fruit juice category with 37% share.

Coco cola’s minute maid, parle , delmonte, godrej are some of the other players in the market

Note-this juice category is different from RTD (ready to drink)category which has brands like frooty, slice, maaza

50%37%

5% 8%

Sales

Dabur Pepsicococa cola others

Availability vs. fruit content

More Availability

Less availability

High Fruit content L

ow fr

uit

cont

ent

The 3 PsProduct- there are around 14 variants available in market

with different fruit flavors

Packaging- Dabur recently launched 125ml real junior pack.

most preferred pack are 200ml , 1 ltr.

Price- Rs. 10-15 for 200ml pck, and Rs 80-90 for 1 ltr

SWOT analysisSTRENGTHS

More health, hygienic consciousnessLow entry barriers.Rise of tier 2, tier3 & rural areas.Changing demographics and consumer behaviorHuge untapped market

WEAKNESSLow capital intensive industry attracts new entrants.Low quality standards of unrecognized players- leading to low confidence in industryDemand is seasonal dependent

OPPORTUNITIESIncreasing Organization of retail stores.Differentiated packaging and variants.Healthy propositionUnique offeringsWider option- from single fruit to mixed fruit.Product extension- sachets of fruit powder.

THREATSIntense competition from local manufacturers. Government regulations and pricing policiesUninterrupted logistics and supply of raw material.Local juice vendors.

Industry competitiveness through PORTER’s5 Forces model

THREAT OF NEW ENTRANT

BUYER’S POWER SUPPLIER’S POWER

THREAT OF SUBSITUTES

MODERATE

HIGH

Moderate

HIGH

INDUSTRY HIGH

RIVALRY

Unbounded opportunities Shift towards 100% juice from concentrated juices. Healthy proposition- eg-fiber enriched, no sugar. Unique offerings- eg- dryfruit apple juice. Wider option- from single fruit to mixed fruit. Product extension- sachets of fruit powder.

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