Ratna Bhushan

PepsiCo India has removed the word 'energy' from new Sting cans and bottles. This action complies with the food safety regulator's upcoming deadline for the category. Other energy drink companies are seeking an extension from the government. Distributors are already declining existing energy drink stock from companies. The energy drinks market in India is estimated at over thirteen thousand crore rupees.

In the second part of the series, Ratna Bhushan, ET's FMCG Editor, brings in two industry voices to dissect the impact of FSSAI and Maharashtra FDA's crackdowns. Anjan Chatterjee, founder of Speciality Restaurants, argues surprise audits are overdue but says license suspension should be a last resort, not a first response. Ashwin Bhadri, founder of Equinox Labs, backs the enforcement push while calling for improvement notices before suspensions, faster novel-ingredient approvals, and mandatory food-safety education in schools. With the Cricket Club of India already in Bombay High Court challenging its suspension, and more legal disputes brewing, this episode asks: can India's food and drink industry clean up fast enough, without the crackdown becoming counterproductive? Listen in.

Restaurant chains experienced a significant recovery in the April-June quarter. Value growth and expansion into smaller cities drove this positive trend. Higher in-store traffic and improved daily sales contributed to the recovery. Chains are focusing on value meals and selective price adjustments. This marks a reversal after several quarters of declining sales and profits.

India's food regulator has ordered energy drink brands to remove the word 'energy' from labels. This directive impacts major brands like Red Bull, Sting, and Campa Gold Boost. Companies face challenges in rebranding and marketing their products without the established term. Distributors are refusing stock, causing trade disruptions and potential market uncertainty. The future of this multi-billion dollar market now hangs in the balance.

Orkla India sees increased competition driving innovation and experimentation in food products. The company reported revenue growth and improved profits in the recent quarter. Supply chain disruptions have significantly eased after initial challenges from regional conflicts. Orkla is enhancing its product portfolio with added protein and nutritional benefits. This strategic shift aims to remain relevant to younger consumers seeking healthier options.

Dabur India is contesting the FSSAI's recent prohibition on products boasting '100% pure' claims, joining numerous other companies that have similarly sought legal redress against the food regulator. These businesses argue that their labeling adheres to existing Indian laws. The FSSAI has imposed bans on various products due to alleged misleading representations, with spirits brands also facing penalties for opting for artificial flavoring over traditional aging methods.

Orkla India's MD, Sanjay Sharma, discusses how competition from smaller brands is driving innovation in their food products while overcoming supply chain disruptions.

The sector's rising cash burn, coupled with the relatively limited size of the addressable market, is beginning to concern investors tracking the space. The category is economically viable primarily in urban catchments, where high order density supports efficient fulfilment and worker utilisation. Expanding into lower-density neighbourhoods is significantly more challenging, another industry executive said.

Britannia Industries MD Rakshit Hargave backed FSSAIs crackdown on packaged foods and beverages, saying consumer interests should be protected. Britannia is also strengthening its regional strategy amid rising competition and plans price increases of 1.5-2% in the second quarter.

Restaurants nationwide are voluntarily closing outlets for deep cleaning and hygiene improvements. Regulatory crackdowns over food safety and labelling violations are intensifying across India. Many chains are reducing artificial food colours and enhancing staff training programs. Some establishments are pursuing legal action after facing forced shutdowns and licence suspensions.