New York, Feb. 17 (PTI): Prime Minister Narendra Modi's demonetisation drive had a "significant impact" on PepsiCo's business in the country in the last quarter of 2016 and there are still "lingering effects" of it, according to the food-and-beverage giant's India-born CEO Indra Nooyi.

"Demonetisation had a significant impact on our India business in the fourth quarter," Nooyi said during an earnings call for Pepsi's fourth quarter that ended on December 2016.

Responding to a question during the call on Wednesday on whether demonetisation had any impact on Pepsi's beverage or snack business, Nooyi said there were still some "lingering effects", noting that she is "not sure we are totally out of the woods".

Nooyi said demonetisation was a "massive change" since about 80 per cent of the currency in circulation in India were no longer legal tender.

She added that the implementation of the policy, too, had its "share of challenges" but hoped that things will return to normal by the second quarter that will end in June this year.

"So our hope was that by the time the second quarter rolls by we would be through the bulk of the demonetisation challenges and the new currency and the digital currency will be back in circulation and we will be back to retail activity coming back to normal," Nooyi said.

PepsiCo reported net revenues of $19.51 billion in the last quarter of 2016, up 5 per cent from $18.58 billion in the same quarter in 2015.

Its net income, however, fell 18 per cent to $1.40 billion in the quarter ended December 2016 compared with $1.71 billion in the year-ago period.

On the outlook for the current year, Nooyi said the company expects "solid financial performance despite anticipated continued macroeconomic challenges".