Oil-to-telecom conglomerate Reliance Industries Ltd is gearing up to disrupt India’s Rs 20,000-crore packaged drinking water market much like it did with Jio in telecom and Campa Cola in soft drinks, by sharply undercutting competition on price. Its newly launched Campa Sure and Independence water brands are selling at discounts of 20–43 percent compared to incumbents such as Bisleri, Aquafina and Kinley, setting the stage for a shake-up in a category long dominated by these established players.
Launched in September, the company's Campa Sure brand is set to be rolled out nationwide in October, as its FMCG arm Reliance Consumer Products looks to strengthen its position in the beverages sector with aggressive pricing. A one-litre Campa Sure bottle is priced at Rs 15 against Rs 20 for Bisleri, Aquafina and Kinley, while the two-litre pack sells at Rs 25 compared to Rs 30–35 for rivals. Independence, Reliance’s other water brand, is even more aggressive with its 1.5-litre bottle at Rs 20 versus Rs 30–35 charged by incumbents.
The pricing strategy is identical to Campa Cola drinks which is priced at Rs 10 for 200 ml, forcing incumbents like PepsiCo and Coca-Cola to make significant price adjustments and introduce promotional tactics to protect their market share. Campa, which was officially launched by RIL in 2023 after it was acquired from Pure Drinks Group, has now captured a 14 per cent market share in key Indian cities, marking a significant challenge to the long-standing duopoly.
RIL did not respond to email seeking comment.
Increased consumption of bottled water
The foray into the packaged drinking water segments comes amid market expectations of a double-digit growth through 2030. According to experts, the India bottled water market has grown by 40-45 percent over the last five years, driven by high population growth rates, rise in foreign visitors, inadequate supply of clean tap water and easier availability of bottled water.
A United Nations report released in March 2023 noted that India’s mineral water market was the world’s second fastest-growing between 2018 and 2021, expanding at an annual rate of 27 percent and ranking as the 12th-largest bottled water consumer by value. The strong demand persists despite government initiatives such as the Jal Jeevan Mission, which has expanded tap water access, as households continue to grapple with issues of unreliable supply, last-mile contamination, and groundwater depletion.
In India, bottled water is sold in four main types - one-litre bottles, two-litre bottles, 500 milliliter bottles, 250 milliliter bottles, pouches, and barrels of 15-20 litres Among the different SKUs, one-litre bottles have the largest market share, followed by 500 millilitre bottles and 250 millilitre bottles.
Competition and distribution
From roadside stalls to corporate offices to five-star hotels, India’s bottled water market flows through the hands of just a handful of dominant players. Bisleri leads with 36% market share, followed by Coca-Cola's Kinley, PepsiCo-owned Aquafina, and Tata Consumer Products-backed Himalayan.
Bisleri boasts an extensive distribution network and numerous plants across India and neighboring countries, utilizing approximately 4,500 distributors and 5,000 distribution trucks to reach consumers from its network of 122 operational plants. Meanwhile, Aquafina's distribution through Varun Beverages Ltd (VBL) reaches a wide range of channels, with VBL's vast supply chain with 130+ depots, 2,600+ owned vehicles, 2,800+ primary distributors.
When asked about potential impact to the incumbents with the new entrant, Amit Purohit, Vice President at Elara Capital, said any impact would be seen over the medium to long term.
'The impact of the new launch would be visible over the medium to long term and will depend on the distribution roll-out of Reliance. The key challenge would be the higher distribution cost and well spread-out manufacturing facilities. Further, there is strong HORECA (Hotels, Restaurants, and Cafés/Catering) segment as well in the water business which needs to be scaled up. Hence impact would be visible over medium term on the incumbents," Purohit said.
Disclosure: Moneycontrol is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.
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