Hindustan Unilever drops 'health' label from Horlicks, calls it 'functional nutritional drink'

During FY24, Horlicks has seen strong penetration and market share gains, said the company in its investor presentation.

Hindustan Unilever has re-named its 'health food drinks' category as functional nutritional drinks (FND), a move after the Ministry of Commerce and Industry asked e-commerce websites to remove drinks and beverages from 'heathy drinks' category on their platform.

"We have changed the labels of the category to FND which is a much better way to call it," said Ritesh Tiwari, chief financial officer of Hindustan Unilever at the earnings press conference on April 24.

Tiwari said that the FND category is under-penetrated and hence there is a big opportunity for growth in the same. Hindustan Unilever will focus on increasing customers, increasing usage, and giving more benefits for consumers to upgrade in the FND category, said Tiwari. He also said that the company is seeing better growth in its premium FND range which caters to Diabetes and women's health.

During FY24, Horlicks has seen strong penetration and market share gains, said the company in its investor presentation.

Also read Urban markets, premium products continue to drive FMCG growth even as rural demand seeing recovery: HUL

The National Commission for Protection of Child Rights recently had said that there is no definition for 'health drinks' under the Food Safety and Standards Act 2006. The Food Safety and Standards Authority of India (FSSAI), earlier this month, had asked e-commerce websites not to put dairy, cereal, or malt-based beverages under the ‘health drink’ or ‘energy drink’ categories.

The reason - health drink is not defined in the food laws of India, while 'energy drinks' are just flavoured water-based drinks under the laws, argued FSSAI. FSSAI said using wrong terms can mislead the consumers and had hence asked the websites to either remove or correct the advertisements.

All these developments happened after Mondalez India-owned Bournvita caught attention for its high sugar levels a year ago.

As per Technavio, an industry market research and advisory firm, the health beverages market share in India is expected to increase by $3.84 billion from 2021 to 2026, and the market's growth momentum will accelerate at a CAGR of 9.89 percent.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.​​​