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Coca-Cola Planning Cheap New Drinks For India

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Amid stiff competition from local brands in India, beverage giant Coca-Cola Co. (KO) plans to launch a new category of aerated drinks called Kinley Flavors, the Economic Times reported. The new range of soft drinks will be rolled out in popular localized flavors.

Coca-Cola India said in late June that it will launch an affordable range of aerated beverages to cater to price-sensitive consumers.

According to the Economic Times report, the upcoming range of soft drinks will be 35 percent to 40 per cent cheaper than Coca-Cola's own existing range of fizzy drinks such as Coke, Sprite and Fanta. It will include popular local flavors such as lemon, jeera (cumin), and orange, and is targeted at the bottom segment of the market.

The new range will be available in 250 ml PET packs at "attractive price points," the report quoted a Coca-Cola spokesperson as saying. The beverages will be among the cheapest for Coca-Cola across its various markets.

In India, there are more than 200 so-called B brands of aerated drinks that are popular as they are available at prices that are almost 50 percent cheaper than the products launched by multinational companies.

According to industry estimates, these brands now hold a consolidated share of over 12 per cent of the packaged aerated drinks segment.

Aerated drinks have been taxed at an effective rate of 40 percent under India's new Goods and Services Tax or GST, launched on July 1. The GST is seen as India's most significant centralized taxation reform to be implemented.

Coca-Cola India said that following the launch of GST in India, it has minimally increased the prices for aerated beverages even after absorbing a significant portion of the tax increase.

In addition, the company said it will reduce the price of its packaged drinking water brand 'Kinley' and launch the affordable 'Value Water' segment that is priced significantly lower than the current portfolio of Kinley water.

According to the Economic Times report, Coca-Cola is also expected to launch the Monster energy drink in India over the next few weeks.

by RTT Staff Writer

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