Coke, Pepsi hike prices by Re 1/bottle

Two years after slashing prices to push volumes, both Coca-Cola India and PepsiCo on Wednesday increased prices of 200 ml and 300 ml bottles by Re 1.

"Though we have increased prices by Re 1, it is not across the country. The price increase has been effected region-wise," Coca Cola India president and CEO Sanjiv Gupta told reporters in New Delhi.

He said the company had already hiked prices on PET bottles by 10-12 per cent about three months back.

The price increase has been carried out keeping in view the regional requirements of the Indian market, he said, adding the last summer was "good" for the Indian arm of the Atlanta-based softdrink giant.

Asked whether the company would introduce any product in India, he said, "We keep evaluating the option."

With the prices going up, a 200 ml bottle of the soft drink will now cost Rs 6 while a 300 ml bottle will be priced at Rs 7.

Both Coke and Pepsi had been toying with the idea to jack up prices for the last 2-3 months as the companies felt that growth in value terms was hit hard even as volumes soared.

Cola companies had been clamouring for abolition of special excise duty. With Finance Minister P Chidambaram not tinkering with the duty in the Budget, hopes of a price cut have been dashed.

At present, there is 16 per cent excise duty and 14 per cent sales tax on cola products, which make the lower pricing strategy unviable in the long run, industry observers said.