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Oct, 03 2018

PepsiCo India makes profit in the country after 7 years

The profit was driven by cost-efficiency measures, high-margin products and higher capacity utilization.

Beverage and snacks maker PepsiCo India has made a profit in 2017-18 after a gap of seven years. The profit was driven by cost-efficiency measures, high-margin products and higher capacity utilization.

PepsiCo has reported a net profit of Rs 190 crore in 2017-18. The company posted a loss of Rs 148 crore a year previously. The last profit PepsiCo reported was in 2010-11. The beverage company exited the fourth quarter of 2017-18 with double-digit growth momentum.

Rajdeep Datta Gupta, Chief Financial Officer of PepsiCo India, said, "Focus on profitable channels, packs and innovation, cost management and productivity to offset inflation, local agriculture programmes and procurement for citrus and corn, and maximising capacity utilisation were factors that brought balanced growth."

PepsiCo launched 80 products and variants, including flavours, pack sizes and packaging between 2015 and 2018. Out of its products, Lay's, Kurkure, Quaker and Doritos were the key growth drivers. The new high-margin products like Pepsi Black and energy drink Sting also showed 'encouraging results'.

New York-based Purchase's India unit said in 2016 that it was taking a three-year reset to transform its portfolio for sustainable and profitable growth. It has rationalised its portfolio for operational productivity as well as reinvested in marketing expenses.

"Higher capacity utilisation is helping leverage cost lines. Strong cost-management is offsetting the inflation that we are seeing," Gupta said.

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