A Big Bet on 'Chotu Packs'! The Battle for ₹10-₹20 Bottles Begins—Coke, Pepsi, and Campa Cola Now Face Off

New entrants in the cold drinks market are placing a strong emphasis on the "Chotu packs"—small-sized bottles priced between ₹10 and ₹20. Consequently, their market share has seen a significant rise, posing a distinct challenge to the industry's established giants.

Cold Wars: The arrival of summer invariably sparks a flurry of activity within the soft drink market. This year, the competition among beverage companies is set to intensify even further. According to a report by CRISIL Ratings, new players entering the market are focusing heavily on these small-format cold drink packs, available in the ₹10–₹20 price range.

In this specific category, the market share held by these new entrants surged to an estimated 6–7 percent during the last fiscal year—a substantial leap from just 2 percent in 2024. In light of this escalating competition, it is anticipated that the established market leaders—companies that have long dominated the sector—will ramp up their spending on marketing and distribution. Furthermore, they are expected to expand both their production capacities and their distribution infrastructure to keep pace.

What’s the Appeal of These 'Chotu Packs'?

Essentially, consumers show a distinct preference for these small cold drink bottles priced at ₹10 or ₹20. People find it incredibly convenient to purchase when thirst strikes while they are on the go. They can be finished in just a few sips—effectively quenching one's thirst and providing a moment of refreshment—without the hassle of having to carry a large bottle around.

This is precisely why numerous new cold drink brands—such as Reliance's Campa Cola—are prioritizing this segment. As a result, their market share has witnessed rapid growth over the past few years. However, this trend has become a cause for concern for legacy companies like Coca-Cola and Pepsi, who fear losing their market dominance. Consequently, these established players must now boost the availability of their own small-format packs to ensure that, amidst the scorching summer heat, their "Chotu packs" are also visible in the hands of consumers on every street, road, and corner. Capturing the Rural Market

If the goal is to increase market share, "Chhotu Packs" (small-sized packs) offer the best avenue in rural India. Here, consumers often prefer not to purchase large bottles priced at 40–50 rupees. Consequently, the 10-rupee pack serves as a "magic point" for the rural Indian market. Meanwhile, regional brands such as Jayanti and Hajoori hold significant dominance in several parts of the country, making the competitive landscape even more intense.

Robust Earnings Ahead

A CRISIL report released on Tuesday indicates that, despite intensifying competition among companies, soft drink bottlers are still expected to see a resurgence in earnings this fiscal year. Following a sluggish performance last year, their earnings are projected to rebound and reach their long-term average growth rate of 15 percent. This growth is primarily driven by higher heat levels and rising temperatures.

The summer months alone account for 40 percent of total sales. However, the surge in crude oil prices—triggered by the ongoing conflict in West Asia—has exerted upward pressure on packaging costs, which could negatively impact the industry's profitability. This factor could potentially erode profit margins by up to 250 basis points (bps).