Geopolitical conflict, early monsoon impacted Q2 volumes in India: Coca-Cola global chief Quincey

Beverage maker Coca-Cola said its unit case volume growth declined in India in the April-June quarter, impacted by early monsoons and geopolitical conflict.

“In India, after a strong start to the year, volumes declined as our business was impacted by the early monsoon and geopolitical conflict early in the important summer season,” James Quincey, Coca-Cola’s global chief executive officer, said during the company’s quarter earnings call late Tuesday.

The maker of Coke and Thums Up soft drinks said its unit case volume declined 5% in the Asia Pacific region in the quarter, largely due to a decline in India and the impact of refranchising bottling operations.

The company, however, noted that it was “optimistic about recovery through targeted marketing campaigns”.

India is the Atlanta-based company’s fifth largest market.

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Quincey said to offset the disruptions, the company is “engaging consumers with integrated marketing campaigns and tailoring these activations to local and regional needs.” He added that the Coca-Cola system recently surpassed one million customers on its digital ordering platform.On a consolidated basis, Coca-Cola’s unit case volume declined 1%, with growth in Central Asia, Argentina, and China more than offset by declines in Mexico, India, and Thailand.Addressing a query on growth outlook for India, Quincey said: “In the case of India, it’s never going to be a straight line and indeed Q2 was not. But we are very bullish on India overall.”

He added that the company has just set up the first of its kind re-franchising piece with Jubilant Group for its company-owned bottler. “That’s up and running with a new CEO. We think that will bring some new energy, dynamism, focus and proactivity to the execution in the marketplace. We’ve got a strong plan from a marketing and innovation point of view.… with some re-energized focus on this transition bottler,” Quincey said.

Last year in December, Coca-Cola announced that it would sell 40% stake in its bottling arm Hindustan Coca-Cola Beverages Pvt Ltd (HCCB) to the Jubilant Bhartia Group.

Rival PepsiCo too had reported decline in its beverage business in India for the 12-week period ending June 14, on account of early rains.

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