Celsius has managed to grow in last three years and it has annual revenue of $400 million when compared to Red bull and monster which are the market leaders in the energy drinks. Celsius also claims that it burns body fat. Traditional energy drinks like Red bull and monster have caffeine, sugar and vitamins b6 that basically give a burst of energy. Celsius on the other hand, does not have sugar it has something new called the metaplus which is basically a green tea extract and guarana as sugar substitute. It claims that it regulates the metabolism and fastens the fat burn rate and calorie burn rate by thermogenesis.
Celsius growth has been off the charts as it slowly increases its distribution globally. In 2019, the growth rate was at 43%, in 2020 the growth was 74%, last year in 2021 it was up 140% and in the first quarter of 2022 it was up by 167%. Such kind of growth has got investors really excited, and the company is valued currently at US$ 5.6 billion.
With energy drinks the biggest risk is if somebody else comes out with a better drink. Monster basically uses the same ingredients as Red bull except for two ingredients which are unique in Monster. One can of Celsius cost US$ 2 and most energy drinks are also in the same price range. Apart from the explosive growth seen in the US markets the Europeans sales have actually started declining this year. The US used to be 78% of the energy drinks market a year ago now it is 93 %. Celsius has become more of a US centric brand and it needs to start attracting customers in other regional markets.
For investors thinking of investing in Celsius important thing to remember is that because it is growing so quickly, the market analysts are not able to predict the growth rates and market trends accurately and this can be risky proposition in the long term.