Is PepsiCo Stock Halal? Beverages, Snacks, and Sharia

Quick Verdict

PepsiCo (PEP) sits in the DOUBTFUL category for Muslim investors. Unlike Coca-Cola, PepsiCo doesn't directly produce alcoholic beverages — but it has entered licensing and distribution agreements for some alcohol-adjacent products. The bigger concern for some scholars is PepsiCo's snack foods portfolio, specifically the pork-derived ingredients in some Frito-Lay products.

PepsiCo's Business Segments

• Frito-Lay North America (~27% revenue): Lays, Doritos, Cheetos, Tostitos
• PepsiCo Beverages North America (~27% revenue): Pepsi, Mountain Dew, Gatorade, Tropicana
• Quaker Foods (~4% revenue): Oatmeal, cereals, rice cakes
• International divisions (~42% revenue): Global beverages and snacks

The Pork-Derived Ingredients Issue

Several Frito-Lay products contain pork-derived ingredients (lard, pork enzymes in some flavored chips). However, from an investment perspective, scholars generally don't apply the personal consumption screen to investors — you're not eating the chips, you're owning shares of the company that makes them.

The more relevant screen is: what percentage of Frito-Lay's revenue comes from products with haram ingredients? This is difficult to estimate precisely, but many screeners treat Frito-Lay's snack portfolio as a broader concern.

Financial Screening

• Debt / Market Cap: ~25% ⚠️ (elevated)
• Interest Income / Total Revenue: Under 1% ✅
• Haram Revenue: Disputed — pork-derived snacks and some alcohol exposure ⚠️

Screening Agencies' Verdict

• Zoya App — Not Compliant ❌
• MSCI Islamic Index — Excluded ❌
• Most halal ETFs — Not held ❌

Bottom Line

PepsiCo fails Islamic screening primarily due to the pork content in portions of its snack portfolio and secondary concerns about alcohol exposure. For investors seeking consumer staples dividend stocks, look for food companies whose entire portfolio consists of halal products, or diversified consumer staples ETFs with Islamic certification.