People’s taste in India changed, now people are buying soft drinks without sugar, sales of Pepsi and Coke doubled.

Soft Drinks Market: India’s Rs. 60 thousand crore soft drink market is currently witnessing a major change. People are now avoiding drinking sweet cold drinks. Instead, sugar-free or low-sugar drinks are becoming people’s first choice. Data for the quarter from July to September 2026 shows that the share of zero-sugar and low-sugar drinks in PepsiCo’s total volume has doubled to a record 88 percent. This figure was only 44 percent in the same quarter last year. The market’s largest company, Coca-Cola, also saw sales of diet and soft drinks double from last year.

Companies save costs amid expensive sugar

People’s changing habits have given a big relief to cold drink companies. This year the price of sugar in the country is skyrocketing. The price of sugar which was fetching Rs 40 to Rs 50 per kg last year has increased to Rs 58 to Rs 65 per kg this year. Bad weather, low domestic production, demand during the festive season and reduced global supply have damaged the sugarcane crop, making sugar so expensive.

PepsiCo’s bottling partner Varun Beverages (VBL) told investors after September quarter results that increased sales of low-sugar and no-sugar products helped it offset the impact of expensive sugar. According to VBL President and Whole-Time Director Raj Gandhi, the crisis in West Asia has led to a significant rise in raw material inflation. Despite this, the company managed to protect its gross margin due to the reduction in sugar consumption. These PepsiCo figures also include sales of sugar-free Pepsi, 7 Up Sugar-Free, Everways soda and Aquafina water.

Diet Coke breaks record, plans to launch new drink

Coca-Cola is also adopting a very aggressive strategy in view of this growing market. The company is rapidly promoting sugar-free flavored drinks such as Thums Up, Coke Zero, Diet Coke, Sprite Zero as well as Schweppes. Apart from this, the company is also preparing to launch its global drink ‘Coke Zero Zero’ on a large scale. This special drink contains neither sugar nor caffeine.

Diet and soft drinks accounted for a five-year high of 30 percent of Coca-Cola’s total sales last year, according to two of the company’s senior bottling associates. This year this figure has more than doubled and crossed 60 percent. Diet Coke sales in the first nine months of 2026 alone have increased by 150 percent compared to last year, an official said. Notably, there was a severe shortage of aluminum cans in April-May this year due to supply disruptions due to the West Asia War. Despite this disruption, the sales surged. Emails sent to Coca-Cola in this regard did not receive a reply till the news was published on Monday. However, in its earnings call last week, the company said that affordable prices, zero-sugar options and a sound strategy in the domestic market have helped it perform well amid global fluctuations.

Increased competition from new players in the market

The zero-sugar category is now growing twice as fast as sweetened beverages. To meet this sudden increase in demand in the market, companies are ramping up their production even before their set targets, so that there is no shortage of goods in the market. Now not only Pepsi or Coca-Cola, but many new brands have entered the fray. Recently, the popular brand Lahori Jeera has launched its first sugar free variant in the market. Similarly, Reliance Consumer Products’ Campa and Veeba Foods’ brand Gyro have also launched zero-sugar colas. Two months ago, clean-label beverage brand ‘Sorry Sugar’ also raised $1 million in its first seed funding round. This is a clear indication that the sugar free cold drinks market is going to grow in the coming days.