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CASTLE MALTING NEWS in partnership with www.e-malt.com Portuguese
09 February, 2020



Brewing news India: Carlsberg’s Indian business grows only 1% in volumes last year

Danish brewer Carlsberg’s India business grew only 1% in volumes last year, a sharp decline from 19% growth in 2018, as changed excise regulations and taxes in some states impacted sales in the second half, the Economic Times reported on February 8.

“The weakness in second half and especially Q4 was driven by several factors, including change in excise duties and regulation in a few states,” Cees ’t Hart, global chief executive officer of Carlsberg, said in an investors’ call. Revenue growth was in the high single digits, “supported by price increases and lower rebates”, he said.

Carlsberg has about 18% market share in India where the strong beer segment accounts for about 80% of the market. It has two strong beer brands — Tuborg Strong and Carlsberg Elephant. Tuborg accounts for more than two-thirds of the company’s annual sales.

The overall beer market in the country grew 6.9% in volume in 2019 compared with 5.7% in 2018, according to GlobalData, a UK-based research firm. The pace of growth remained significantly slower than the pre-demonetisation period. Beer sales had increased 10% in 2016. The government had made Rs 500 and Rs 1,000 notes, which accounted for 86% of currency in use, invalid overnight on November 8, 2016.

United Breweries, which controls nearly half the beer market with brands such as KingfisherNSE -11.11 %, Bullet and London Pilsner, said its volumes grew 2% in the nine months ended December.

The April-June quarter typically accounts for nearly 45% of the annual sales in the beer segment, according to GlobalData. Last year, the Lok Sabha elections in April-May also coincided with the Indian Premiere League cricket tournament and summer months, which have both historically boosted demand for beer.

While companies expected a pickup after elections, large markets such as Andhra Pradesh, Karnataka, Maharashtra and Kerala saw either changes to the route to market or price hikes, impacting demand. More recently, Andhra introduced a new bar policy which includes cancellation of existing bar licences, issuance of new permits from January 2020 and reduction in the number of bars by 40%.





Voltar



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