India: SABMiller puts pressure on sate governments to de-link beer from spirits

In a bid to promote beer culture in India, SABMiller India is pressing upon various state governments to de-link beer from spirits business so that it can be made available from general stores, supermarkets, petrol pumps and other traditional retail outlets.

In Delhi, the wholly owned subsidiary of the London-based $15 billion SABMiller PLC is already hawking its beer brands from such outlets. Though, even while selling beer from such stores, liquor companies have to follow certain guidelines like the retail space should be more than 500 square feet and should not be close to any school or religious place.

“The beer market in India is in a very nascent phase. We want to grow the pie by promoting beer as a mild alcoholic beverage. For this, we have to make it easily available and price it competitively. Easy accessibility will come only if the government deregulates retailing of beer (simplify process of acquiring licence to sell). We have taken up the matter with government. Some like Delhi and UP governments have acted on it,” Vinod Giri, director, marketing, SABMiller India, told DNA Money on the sideline of a press conference to announce the event of Castle India Mens Fashion Fair in Bangalore between October 11 and October 14.

Currently, the per capital beer consumption in India is one of the lowest in the world at 0.8 litre. Comparatively, China’s is 20 litres and in the developed countries it is over 100 litres.

However, Giri says the momentum of beer consumption in India has lately picked up. “Our compounded annual growth rate (CAGR) over the last three years is 12% and it is gaining momentum. Our Haywards 5,000 alone has sales of six lakhs a day,” he points out.

The company, which has 37% of the beer market, has drawn up aggressive plans to guzzle down a bigger share. It sealed September 12 a $120 million acquisition deal of Foster’s business and brands in India.

16 September, 2006