Real-time Stock quotes, portfolio, LIVE TV and more.
Jun 21, 2012, 08.56 AM IST
In what could prove to be a big blow to cola and energy drink companies in India, the Union Health Ministry is likely to make it mandatory for manufactures of caffeinated drinks to issue a statutory warning on the label. It may also ask companies to declare the caffeine content in the product.
Besides, the ministry may also make it mandatory for these companies put a statutory warning on the label of their products, which says that this product is not recommended for certain consumer groups.
So if these decisions become enforceable companies like PepsiCo, Coca Cola as well as Red Bull will have to issue a statutory warning in bold and large letters that reads that this product is not recommended for pregnant and lactating woman, for children and persons who are sensitive to caffeine.
Additionally, these companies will also have to declare the caffeine content in their product on the label itself. Now what the analysts are expecting is that once this decision becomes enforceable the demand for these products could be significantly impacted in India.
These new laws are also considerably different from the existing laws, which just makes it necessary for companies to declare that the product contains caffeine and in case of diet versions to mention the fact that the product may not be recommended for children.
What is also interesting is that regulated markets like the US and UK have not mandated any such rules. What analysts also expect is that once these new laws come in to being the demands for aerated drinks which contain caffeine could considerably shift to premium fruit juices and therefore companies like Dabur and HUL which are into the manufacturing of juices could significantly benefit from this.
May 22 2013, 13:11
- in MARKET OUTLOOK
May 22 2013, 10:44
- in Economy