Indian Bottled Water Industry

Bottled Water Industry

What’s on Tap?
 Bottled Water Industry
 Industry Overview
 Past & Future Demand
 Market Growth
 Market Structure
 Cost of Bottled Water
 Per Capita Consumption
 Leading Brands
 Major Players
 Growth Stories
 Industry Standards
 Facts & Figures on Water Purifier
 Past & Future Demand
 Market growth rate
 Market segmentation
 Leading brands
 Major players
 Industry update

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Bottled Water Overview

 Bottled 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.
 Major player existing in the industry with their multiple brands are Parle Bisleri, Parle Agro,
Coca-cola, Pepsico, Kothari Beverages
 There are more than 180 brands in the unorganized sector.
 The small players account for nearly 19% of the total market.

Bottled Industry - Market Segment
 Two Primary Market Segments
 Retail – about 80% of the bottled water market *
 Home/Office Delivery (HOD)
 PET segment is just over one-half the total bottled water volume. *
 PET 52.8%,
 HOD 34.3% 17.8%, 1-2.5 gal. 16.5%)
 Vended 8% (not bottled water)
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* Beverage Marketing Corp. - 2006


Demand - Bottled Water
Demand : Past & Future
Year Mn Cases
 The phenomenal increase in demand for 1995-1996 8.5
bottled water from just 2.0 mn cases in
1996-1997 11.5
1990-91 to 112 mn cases presently was
1997-1998 15.5
being boosted further by the concern and
need for safe drinking water. 1998-1999 20
1999-2000 26
2000-2001 33
2001-2002 44.5
2002-2003 55.6
2003-2004 68.15
2004-2005 82
2005-2006 97
2006-2007 112.85
2007-2008 129.55
2008-2009 146.45
2009-2010 164.45
2014-2015 265
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Market Growth

 The bottled water market is growing at a
Market Growth Rates
rapid rate of around 20% a year (down
from 50 to 60%). Year (%)
 At this growth rate, the Rs 7000 mn per 1990-91 – 1996-97 33.80 %
year market is estimated to overtake the 1996-97 - 2001-02 31.10%
soft drinks market soon. 2001-02 – 2006-07 20.50%
 Multinationals, Coca-Cola, Pepsi, Nestle 2004-05 – 2009-10 15.00%
and others are trying to grab a significant
share of the market. 2009-10 – 2014-15 10.00%

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Market Structure

Market Segmentation
Segment Share (%)
North 25
East 10
West 40
South 25

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Cost of Bottled Water

 The formal bottled water business in India
can be divided broadly into three
segments in terms of cost:
 Premium natural mineral water
 Natural mineral water
 Packaged drinking water.
 The amazing thing is that people are
prepared to pay Rs. 10-12 for a litre of
simple water - especially when the cost of
material input is negligible.
 Cost of packaging is as high as 15% to 35%
of the price of the product.

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Per Capita consumption

 Per capita consumption of bottled water in India is less than half a litre per year, compared
to 111 litres in France and 45 litres in the US.
 The consumption of smaller unit (500 ml) has increased perceptibly by around 140%.
 Even school children are carrying the 500-ml packs in their school-bags.
 The 20 litre jars have found phenomenal acceptance in households and in work places.

These points to the future potential beyond the high growth.
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Leading Brands
Bailley Kingfisher
Bisleri Jaldhara
Peppy Minerelli Pondicherry
Trupthi Himalayan
Kristal Golden Valley Stream
Oasis Evian
Yes Aquafina
Penguin Perrier
Golden Eagle Kinley
Stream Pure Life
Ferra Relle

9


Major Players
Kothari Beverages

Parle Bisleri

Other Players
 Mohan Meakin  Golden
 Mysore Breweries  Hello
 United Breweries  Dadi Group
 NDOB  S M Foods
 Mt Everest  Group Denone

10


Growth Stories
 Bisleri was introduced in India 25 years ago by Parle Exports, the bottled water market
saw virtually no activity till marketers of Frooti (Parle Agro) launched Bailley in 1993.
 Godrej Foods followed with its Golden Valley in 1994.
 Mohan Meakins and SKN Breweries also entered the market with Golden Eagle and
Penguin mineral water.
 Bisleri and Bailley, both of Parle origin, enjoy about 50% market share and has become
almost generic with the product.
 Bisleri was having a market share of about 60% in mid-2000, which dipped to 47% by mid-
2001. The company introduced the concept of home delivery for its 20 litre pack. The
company also introduced 250 ml/300ml packages and cups which would help to expand
the market.
 Bailley, a brand owned by Ramesh Chauhan's brother Prakash Chauhan, and others
including Kinley from Coca-Cola Yes from Kothari Beverages and Aquafina from Pepsi are
the other significant brands.

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Growth Stories………(Cont’d)
 Nestle India, launched its Perrier as first brand and Span Pellegrino, Pure Life as second
and third brands. Pure Life, is positioned at low-end segment where San Pellegrino and
Perrier are positioned in the high-end segment. Pure Life brand is specially aimed at nearly
20 underdeveloped and developing countries. Over the last year, the brand has been
launched in Pakistan, China and Thailand. In Pakistan, Pure Life is supposed to have gained
a 70% share of the bottled water market.
 Premium bottled water market in India has brands like Evian, San Pelligrino, Perrier,
priced between Rs 80 and Rs 110 per litre. The other segment is essentially purified water
priced low at about Rs 10 a litre. It is crowded with numerous brands like Bisleri, Kinley,
Aquafina, Himalaya, Hello.
 Coca-Cola has taken over the Pune-based 20-litre pack water business of Thermax
Culligan Water Technologies, a 50:50 joint venture between Thermax India and Culligan of
the US.
 Others entering into the fray included Britannia with Denone, Cadbury Schweppes with
Schweppes Diamond Water and Pepsi with H2O. DS Foods launched a new variant of its
natural spring water brand, Catch.

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Growth Stories………(Cont’d)
 Danone has launched its own mineral water brand, Evian, in India through a separate
wholly-owned subsidiary, Danone India. Groupe Danone is globally the second-largest
producer of mineral water in the world with brands such as Evian, Volvic, Ferrarelle Badoit,
Font Vella, Aquaprima, among others. The Evian brand has been targeted at the premium
end of the market and is available only in select outlets.
 Hello Mineral Water, a Delhi-based company introduced reusable dispensers. In 1994,
Hello had also started offering hot and cold water dispensers for corporate offices. A
major part (90%) of the company's 240,000 litre per day capacity is utilized by the bulk
segment. Hello will soon face stiff competition from the Delhi-based Sriram Industry which
has entered the bulk segment with its Bubble Top dispenser machines.
 Manikchand Group is diversifying its portfolio to launch bottled water. T-series Ganga will
be re-launched in a better packing and repositioned as a 'Ganges' holy water brand. The
$13-billion French water giant Vivendi Water's arm, US Filter Corporation, has taken a
controlling stake in Johnson Filtration System India.
 Balsara launched its Himalayan brand under Mount Everest Mineral Water. Mauritius-
based Vashistha Ventures was acquiring a 37% stake in the Mount Everest Mineral Water.
The Himalayan brand, claimed as natural spring water is mainly used by institutions like
airlines, hotels, restaurants.

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Industry Standards
 The government decided towards end of the year 2000 to bring about stringent guidelines
for packaged water.
 All companies were made to sell their products only under the BIS (Bureau of Industrial
Standards) certification mark. The BIS certification was made mandatory for the segment
from April 1, 2001.
 The bottled water is to be classified as "food" and has been brought under the Prevention of
Food Adulteration Act. They would have to adhere to rules pertaining to colour, odour,
taste, turbidity, total dissolved solids and aerobic microbial count.
Resulted into;
 Coke have to do away with the certification 'Federation of Family Physicians Associations of
India' printed on its product.
 Visakhapatnam - based Life Line Aqua secured the BIS certification.
 To ensure quality that AusWater Purification of Australia had tied up with Shriram Institute
of Industrial Research to set up a quality control laboratory in Uttar Pradesh.
 Thermax Culligan Water Technologies (JV of Thermax and Culligan International, USA), which
had launched 20 litre bottles in the name of "Good Water Everflo", had also placed a quality
control network in place. The outfit is now part of Coca-Cola.

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Facts & Figures on Water Purifiers

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Water Purifiers - Facts
Demand : Past & Future
Year Rs. Bn
1995-1996 2.55
1996-1997 2.8
Market Growth Rates
1997-1998 3.5
Year (%)
1998-1999 4.2
1999-2000 5 1990-91 – 1996-97 16.00 %
2000-2001 5.85 1996-97 - 2001-02 19.80%
2001-2002 6.9 2001-02 – 2006-07 10.20%
2002-2003 7.95 2004-05 – 2009-10 11.00%
2003-2004 9 2009-10 – 2014-15 10.00%
2004-2005 10.25
2005-2006 11.5
2006-2007 12.9
2007-2008 14.25
2008-2009 15.7
2009-2010 17.25
2014-2015 27.8
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Water Purifiers – Market Segmentation

M
Market Segmentation
Institutional Segment Share (%)
30%
Domestic 70
Institutional 30

North 25
Domestic East 25
70%
West 40
South 10
South
North
10%
25%

West
40%
East 17
25%


Water Purifiers - Market Segmentation ……
(Cont’d)
 Product
On-Line
30%
Product Variation
Type Share (%)

Off-line 70
On-line 30
Off-Line
70% Ultra violet 40
technology
Resin based 60
technology
Ultra violet
technology
40%
Resin based
technology
60%

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Water Purifiers - Leading Brands
Aquapen Waterguard
Pureline Autoguard
Pure Sip Moniba UB
Zero B Aquaguard
Ultraline Aquarius
Puripack Hello
Bubble Top Puripack UV
Alfa

19


Water Purifiers - Major Players

Ion Exchange Pureline

Aquatech International Kenstar (Videocon)

Eureka Forbes
Usha Shriram Brita Therma-Culligan

Strategic Alliance
Company Collaboration Singer
Aquatech Aqua Pure Techgy, Moniba Anand
USA
Thermax Culligan Intl, USA Alco Industries
Usha Shrirm Brila, Germany
20


Water Purifiers - Industry Updates

 Usha Shriram with its Brita water purifier already established, has launched India's first
digital water purifier - the Waterguard Digital in collaboration with Brita GmbH of
Germany. Apart from killing disease-causing bacteria and virus the filter claims to dissolve
hazardous organic pollutants, to ensure safe drinking water. Other features include a
cartridge life indicator (on the LCD screen) detachable spill tray lamp life indicators and a
computerized monitoring system (to control the purification process).
 In the market for water purifiers, Aquaguard from Eureka Forbes, remains the market
leader, several others have made it to the market place.
 Proctor & Gamble (P&G) has also been planning to launch its international brand Pur - a
water purification product. The product has been developed is close consultation with CDC
(Centre for Disease Control and Prevention) and USAID. The product is expected to be
highly useful for developing countries such as India.
 Hindustan Uni Lever (HUL) also forayed into the water business, with its water purifier
device called Pure. It can be attached to the kitchen tap to purify potable water at
minimum cost. HUL plans to take the purifiers to small metros, towns and cities so that it
does not remain an urban phenomenon.
 Water purifiers (residential segment) are growing at 22-25% annually.
 It is a Rs. 5 to 6 bn industry, with Aquaguard cornering more than 50% of the market. The
rest is divided among Kent RO, Pentair, Ion Exchange and others.

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Sources

 The Hindu
 India Stat.com
 Bottled water India.org
 Beverage Marketing Corp.
 International bottled water association

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Thank You!!
Presented By:-
Pranjali Singh
(Research Analyst)

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