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PepsiCo to triple health drink biz in 10 years

April 13, 2010 12:18 IST

Indra NooyiGlobal cola major PepsiCo aims to triple its $10 billion health drink business over the next 10 years as it sees 'huge growth areas' for its 'Good for You' drinks, the company's chairman and CEO Indra Nooyi said in Chicago.

"There is a tremendous growth in the health drinks segment. Right now we have a $10 billion business for 'Good for You' products.

"We think over the next 10 years, the business will be worth $30 billion," Nooyi said at an event organised by the Economic Club of Chicago on Monday.

She said going forward, the $60-billion PepsiCo would focus on geographic development as well as expansion of its 'Good for you' category of snacks and drinks.

While the company would expand footprint of its existing products, there are several markets where the per capita consumption of Pepsi's products is low.

There are tremendous geographic growth opportunities especially in the fruits, vegetables and grains category.

While Pepsi already has a sizeable business in the health drinks segment, there are huge growth areas for the future, Nooyi said.

PepsiCo commands significant market share with its portfolio of health and wellness drinks.

About 80 per cent of the company's portfolio is made up of 'Fun for you' products such as Pepsi, Diet Pepsi, Lays, Doritos and Fritos.

The other 20 per cent is made up of 'Good for you' health drinks such as Tropicana, Quaker Oats and Gatorade.

Last week PepsiCo announced that it was exploring possibility of a joint venture in non-fizzy soft drinks like juices with Tata Tea, which has under its belt natural mineral water brand Himalayan and energy drink 'T!ON'. Nooyi, however, refused to comment on the JV.

On her outlook for the American economy, Nooyi said the US would continue to be the 'single largest economy' over the next 20-30 years.

Contrary to popular sentiments that in the coming years, balance of power would shift to Asia, which will become home to some of the largest economies,

"US will remain the most powerful economy," she said.

"The country still is a hotbed of creativity. Don't write off the US. I don't think the world can be successful if the US is not successful," she added.

Image: Indra Nooyi

Yoshita Singh in Chicago
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