PepsiCo India Partners with Tata Consumer Products for Packaged Snacks
PepsiCo India and Tata Consumer Products have partnered to collaborate in the packaged snacks segment, a significant partnership four years after the dissolution of their joint beverage venture, NourishCo. Unlike their previous 50:50 joint venture, this collaboration is not a formal joint venture but a strategic alliance to leverage their respective brand strengths.
This alliance will bring together PepsiCo's popular Kurkure snack brand with Tata Consumer's recently acquired Ching's Secret, a prominent name in noodles and condiments. Aastha Bhasin, Marketing Director for Kurkure & Doritos at PepsiCo India, described the initiative as a 'milestone collaboration', emphasizing the growing demand for fusion flavors in India.
The collaboration comes as the Indian snacks market, valued at Rs 42,695 crore, witnesses rapid growth and intense competition, particularly from regional and direct-to-consumer (D2C) brands. The ethnic packaged snacks segment is expanding at a rate exceeding 20%, further fueled by regional players offering competitive pricing and attractive retailer margins. Major players like ITC, Haldiram, Bikanerwala, and Parle Products dominate the market alongside PepsiCo, which includes Lay’s and Doritos in its portfolio.
As per a study by IMARC, the Indian snacks market is likely to nearly double in size by 2032 at Rs 95,521.8 crore. Tata Consumer, with its acquisition of Capital Foods the manufacturer of Ching's Secret and Smith & Jones for Rs 5,100 crore in 2023—will combine its strength with PepsiCo's strong foothold in the Indian snacks space.
According to industry insiders, the alliance might be expanded into other products of the two companies' portfolios if the response is good from consumers. The challenge of the venture is not absent as consumer taste may be unpredictable, and the synergy of brands could pose some complexities to the alliance.
In a parallel development, PepsiCo's global headquarters is said to be in exploratory talks with Haldiram Snacks Food to acquire a minority stake in India's largest ethnic snacks company. While the discussions remain preliminary, PepsiCo has expressed interest in the potential deal. Haldiram posted revenue of Rs 12,800 crore in FY24 and offers over 500 snack varieties, including namkeen, sweets, and ready-to-eat products.
This partnership between PepsiCo and Tata Consumer Products is a strategic move to address the growing demand for innovative and ethnic snack offerings in India as the companies seek to capitalize on the booming packaged snacks market. Whether this partnership will succeed or not remains to be seen, but it does represent a bold step in reshaping the dynamics of the competitive Indian snacks industry.
