Sales of Velo nicotine pouches are back on shelves after BAT Kenya secured regulatory clarification allowing the product to be sold in the country again.
The company is betting on smoke-free products to cushion its business at a time when cigarette volumes are shrinking, and the illegal tobacco trade is expanding.
In its latest financial results, BAT Kenya posted a 10 per cent decline in turnover for 2025, with revenue falling to Ksh 23.2 billion. The firm attributed the drop mainly to the surge in illicit cigarette sales, which have eaten into the formal market.
Finance Director Philemon Kipkemoi said the reintroduction of Velo in the second half of 2025 began contributing to sales almost immediately. Between July and December, the product accounted for about one per cent of total turnover, equivalent to roughly Ksh 232 million.
“Our ability to reenter the market in the second half of last year was driven by a more suitable regulatory environment that now accommodates oral nicotine products,” Kipkemoi said.
Velo is an oral nicotine pouch placed between the lip and gum. It contains nicotine but does not involve burning tobacco, positioning it as an alternative for adult smokers seeking smoke-free options.
After divesting its local manufacturing plant, BAT Kenya now operates on an import model. The Velo pouches currently sold in Kenya are sourced from Pakistan. However, the company says it could review the possibility of local production depending on future demand and commercial performance.
At the group level, British American Tobacco reported that it had reached 34 million users of non-combustible products worldwide by the end of 2025. That figure represents 68 per cent of its target to reach 50 million consumers by 2030.
Non-combustible products currently account for 18 per cent of the group’s global revenue. The multinational has set a long-term goal of raising that share to 50 per cent by 2035 as it shifts away from traditional cigarettes.
Locally, Kipkemoi said Velo could grow to contribute between 15 and 25 per cent of BAT Kenya’s revenue within three to five years if uptake remains steady and the regulatory environment remains supportive.
The renewed rollout of Velo signals BAT Kenya’s broader strategy to strengthen its portfolio of alternative nicotine products while navigating tighter regulations and changing consumer habits.
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