Consumer foods giant Hindustan Lever will launch its water business in January 2004.

The foray was significant for Hindustan Lever because its British parent, Unilever Plc, was likely to go in for a global launch of the water business in select markets if the experiment turned out to be successful in India, Hindustan Lever executives said.

At present, Hindustan Lever is tight-lipped about the details of the venture for strategic reasons, but adds that the water business will be under a new brand name.

The company has ruled out its entry through the "purified water in bottles" line, and is looking at tapping the purified water dispensers market by targeting the household sector, a market that is estimated at around Rs 200 crore (Rs 2 billion).

The equipment would provide purified water much cheaper to domestic consumers, compared with bottled water, Hindustan Lever sources said.

With Hindustan Lever entering the water business, the competition is expected to heat up in the domestic market.

The main players in this business include Parle's Bisleri, Parle Agro (Bailley), Pepsico (Aquafina), Coca Cola (Kinley) and Eureka Forbes (Aquaguard water purifiers).

Hindustan Lever, which launched Project Millennium in 1999 to identify newly emerging consumer goods categories, has so far entered the confectionery and ayurvedic healthcare markets.

In the confectionery market, the company has launched its product under the Max brand name.

It has entered the ayurvedic healthcare market by introducing its product under the brand name Lever Ayush.

Although Hindustan Lever claims that its new ventures have been doing well, they are yet to provide significant returns to the company.