Synopsis

India's carbonated soft drinks market is intensifying as ITC launches a premium sugar-free Coconut Cola, aiming to compete with global giants Coca-Cola and PepsiCo. This move follows Reliance Industries' aggressive pricing strategy with its revived Campa brand. ITC plans to expand its beverage offerings, focusing on the premium, health-conscious segment, which is experiencing rapid growth due to increasing consumer preference for low- and no-sugar options.

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Kolkata: India's carbonated soft drinks market is heating up with ITC introducing a premium sugar-free cola, joining Reliance Industries, to challenge global giants Coca-Cola and PepsiCo.

Launched under ITC's B Natural beverage portfolio, the Coconut Cola drink is made with tender coconut water. The company is initially retailing it through quick commerce platforms as a pilot before a wider rollout, targeting the country's fastest-growing diet cola segment.

ITC is also planning to expand its carbonated beverages portfolio with additional flavours and variants. ITC chairman and managing director Sanjiv Puri told ET the company will continue to augment its beverages business with new flavours, variants and pack sizes.

"Growth will be driven across ecommerce, modern trade and traditional channels," said Puri. "It is a large beverage market, and our focus will be more on the premium end," he said, without elaborating.

Sales of sugar-free beverages have been growing at the fastest pace across both carbonated and non-carbonated drinks as consumers increasingly shift towards healthier options. For instance, PepsiCo bottler Varun Beverages reported 63% of consolidated sales volume in the March quarter from low- and no-sugar beverages.

ITC has priced its cola at ₹60 for a 250-ml can. In comparison, a 300-ml can of Diet Coke or Pepsi Black Zero Sugar costs ₹40, while there are ₹10 and ₹20 packs in select markets and channels. Reliance ignited the cola price war two years ago after reviving the Campa brand with a ₹10 price tag for a 200-ml PET bottle, prompting rivals to slash prices and affecting sales across the broader beverages category, including non-carbonated drinks. In FY26, Reliance's FMCG business posted gross revenue of ₹22,000 crore, doubling year-on-year, driven by the beverage portfolio. Campa alone crossed ₹4,700 crore in gross sales.

Reliance Retail director Isha Ambani, who also heads the FMCG business, told shareholders last month that Campa has challenged decades-old market leaders, and emerged as the country's fourth-largest carbonated soft drinks brand with a double-digit market share in key markets.

For ITC, the acquired B Natural brand had been losing ground in the juices and nectars segment amid intense competition from Dabur and Pepsi, with the Campa-led cola price war hurting sales. Over the past year, ITC has repositioned B Natural as a broader beverages portfolio, adding sugar-free and low-calorie fruit drinks. It extended its Sunfeast brand into beverages such as high-protein smoothies. In its FY26 annual report, ITC said it strengthened its beverages portfolio with launch of a "no added sugar" juice range and a coconut water range.