Nestle to Exit Bottled Water Business in India

August 28, 2003

Swiss foods giant Nestle will exit the $200 million bottled water business in India due to low financial returns, a company spokesman said yesterday.

"Pursuant to a review of water business being conducted since last year, the company has assessed that the financial returns even in the longer term are unsatisfactory," a spokesman for Nestle India said.

"Accordingly, Nestle India will be discontinuing the water business."

Nestle India had entered India's 10 billion-rupee (208 million-dollar) a year bottled water business about two years ago with three brands including Perrier.

News reports said Nestle withdrew because it found it difficult to compete with the strong distribution networks for bottled water of rivals Coca-Cola, Pepsi and domestic brand Bisleri.

This was even though Nestle's mass-marketed water, Pure Life, was priced at 12 rupees (25 cents), competitive with other brands. Nestle also sold the sparkling waters Perrier and San Pellegrino in India at 90 rupees (1.8 dollars) for a 750-milliliter bottle.

The spokesman, while declining to give more details on the reason for the withdrawal, said Nestle had only been importing "very small quantities" of Perrier and San Pellegrino to India.

Nestle maintains a strong presence in India with a vast number of popular coffee, dairy and chocolate brands.

Source:

AFP

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