E-Malt.com News article: India: SABMiller announces plans to build a plant in Karnataka by 2012

SABMiller India, India’s second largest beer company by market share, plans to build a new brewery in Karnataka in the next two years to increase capacity in the profitable state where its existing plant is facing a capacity constraint, The Financial Express communicated on August, 24.

“Right now, Karnataka is definitely a priority with us,” said SABMiller corporate affairs director Sundeep Kumar. “The current capacity is very low. We have to import from Pondicherry to serve the market.”

Kumar said it was early to comment on the size of the brewery or the investment involved but said they are aiming to set it up within two years. “We are still finalising the land,” he said.

SABMiller has invested $600 million over the past five years in modernising and expanding its brewery network across the country. Last year, it commissioned a brownfield plant in Haryana while in previous years it had doubled capacity at Charminar Breweries in Andhra Pradesh besides modernising two plants in Maharashtra and in Rajasthan.

The expansion in Karnataka would entail the relocation of the existing brewery at Bangalore, which was the first major acquisition of the UK-based beer giant’s India arm after it entered the country a decade ago.

The proposed brewery would help reduce transportation costs and interstate excise duties it currently incurs by supplying from the Pondicherry brewery.

SABMiller has 30% market share in India which saw sales of around 200 million cases in 2009-10. The company owns brands such as Fosters, Knockout, Haywards, Royal Challenge and Indus Pride and also markets its premium international brand Peroni Nastro Azzurro locally. According to Kumar, Karnataka is among the most-profitable states though Andhra Pradesh and Tamil Nadu sell higher volumes.

Meanwhile, United Breweries Ltd, India’s largest brewer with 50% market share, said last week that it plans to build a new plant in Nanjangud in southern Karnataka in the next 12 months, besides investing Rs 200 crore every year over the next two to three years.




25 August, 2010