West Asia war risks pushing up prices, says Coca-Cola bottler SLMG

SLMG Beverages, Coca-Cola's largest bottler in India, could raise some of its prices if rising packaging costs linked to the ​war in the West Asia are difficult to absorb, a ​senior executive at the firm said.

The war is pushing up costs for ‌key packaging materials from plastic bottles to caps, labels and cardboard boxes - with some packaged water manufacturers already raising prices.

"If the war continues, the packaging material cost may continue to move up," Rahul Kumar, deputy CEO at SLMG said in an interview earlier this month, adding price increases would depend on factors including how competitors respond and how consumers react to higher prices.

The cost pressure comes after billionaire Mukesh Ambani's Reliance Industries revived a historic local cola brand, Campa, in 2023, tapping its vast retail network and a nationalist sentiment to ‌ignite a price war.

There is limited room to raise prices in the highly competitive soda market, which includes several national and local players, Kumar said, adding there has not been a portfolio-wide price increase in the past 7-8 years.

He said SLMG will review prices in April.

SLMG ramps up capacity

Competition will boost India's soft drink market by bringing in new consumers, according to Kumar. Redseer Strategy Consultants estimates the ​country's non-alcoholic ready-to-drink beverages market could double to roughly $40 billion by 2030.

To tap the growth, SLMG - ‌which accounts for more than 22 per cent of Coca-Cola's India volumes - plans to invest between ₹1,000 crore ($106.58 million) and ₹1,200 crore in each of ​four ‌new plants it plans to build over five years.

The bottler's sales climbed 49 per cent to ₹6,773 ‌crore in fiscal year 2025, with net profit jumping 76 per cent to ₹206 crore, according to company database Tofler.

SLMG is now targeting net revenue of ‌₹10,000 crore in ​2026-27, as it expands in populous but lower-income Indian states such as Bihar and Uttar Pradesh, counting on low starting consumption levels and rising ‌incomes to drive greater ​demand for its products there.