Hector Beverages to re-enter energy drinks business

Hector Beverages, maker of Paper Boat drinks, will relaunch its energy drink Tzinga in the next two months, after it was recalled last year on the orders of food regulator FSSAI.

"The FSSAI had said that ginseng and caffeine cannot be present in the same formula, so we have changed the formulation to remove ginseng and will relaunch Tzinga in the next two months," the company's Chief Executive Officer Neeraj Kakkar told PTI here.

"When we launched Tzinga earlier, the regulation on energy drinks was not very clear. In May last year, they told us to recall the product and change the formulation," he said while speaking on the sidelines of the Wharton India Economic Forum.

Tzinga was the first product launched by Hector Beverages which also makes the popular Paper Boat range.

The energy drinks market in the country is relatively small, pegged at Rs 700 crore and is growing at nearly 25 per cent annually, according to industry reports.

Paper Boat has appealed to a niche market in the ready-to-drink segment by selling local flavoured beverages such as aamras, aam panna, kokum and jaljeera.

Hector Beverages will also increase its production capacity in Mysore to 500 bottles-per-minute, from 300 bottles a minute, this year.

It has another production facility with a capacity of 80 bottles a minute in Manesar near Gurgaon, where it will resume production of its energy drink, Kakkar said.

The company is also looking at launching a handful of new products, including flavoured milk, this year.

Hector Beverages employs over 900 people, up from 250 employees last year, Kakkar said.

Paper Boat drink has a strong presence in six top cities, and the company is looking to expand its presence in tier-II and tier-III cities as well.

Over six months back, Hector Beverages struck an exclusive distribution partnership with Indo Nissin, maker of Top Ramen noodles, to help it reach smaller towns.

Paper Boat counts Catamaran Ventures and Sequoia Capital among its investors.

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