New Delhi: Just ahead of the festive season, cola makers are increasing their product prices in a departure from tradition. While Coca-Cola India Ltd has increased the prices of its plastic bottles by 10% across the board, PepsiCo Holdings India Ltd will release fresh stock with increased prices in “a day or two," said a Delhi-based retailer who didn’t want to be named.

The festive season topped by Diwali, which falls this year on 28 October, is usually a time when consumer product companies launch promotional programmes and offer freebies to spur sales. The cola price increase also comes amid concerns of an economic slowdown and a downturn in consumer sentiment.

A 600ml bottle of Coca-Cola products, which include flagship brand Coca-Cola as well as Limca, Fanta and Sprite, will now cost Rs22 against Rs20 earlier. The price of 2l bottles has been increased by Rs5 to Rs55. The prices of the beverages that come in glass bottles have not been increased. The company had last increased prices by a little more than 10% in 2007. “We had to take a price hike because of increase in direct and indirect input costs," said a Coca-Cola India spokesman.

PepsiCo has informed its stockists of a price increase, and another retailer who spoke on condition of anonymity said the company too is likely to raise prices by around 10%. “We are in the process of drawing up plans for the coming year and are reviewing various alternative approaches to pricing our products at this point of time," said Punita Lal, executive director of marketing at PepsiCo India.

The increase is seen as a move by the beverage makers signalling their confidence about a surge in demand for their products. “Almost 25% of the total beverages sales take place during the festive season. A price hike of Rs2 or Rs5 may not thwart the festive moods," said a consumer products analyst who did not wish to be named.

While PepsiCo doesn’t divulge India financials in its global annual results, Coca-Cola does so as a regular practice. The Atlanta-based company has posted eight consecutive quarters of double-digit sales growth in India. Its sales by volume rose 18% in India in the third quarter of 2008.