Mr Vivek Chhabra

K. Giriprakash

Bangalore, Oct. 5 Asia Pacific Breweries, which makes Heineken beer, is eyeing acquisitions in North India while its Hyderabad brewery is set to go on stream later this year.

Asia Pacific Breweries Ltd’s (APBL) Regional Director for South Asia, Mr Vivek Chhabra, told Business Line that its greenfield Hyderabad brewery has been designed to manufacture its corporate brands such as Tiger and Heineken beers. Typically in any new market, Asia Pacific Breweries starts off with production of Tiger followed by Heineken beer.

APBL has invested about $20 million in its Pearl Brewery in Hyderabad which has the capacity to produce 6 million cases every year. It has also got a brewery in Goa which can produce 2 million cases of beer every year. Its brewery in Aurangabad which produces a local beer Cannon 10000 and Baron’s Strong Brew (beer) has a capacity to produce another 2 million cases.

APBL has invested about $18 million in this brewery. Totally, the beer company has invested about $45 million in India including $5 million as capex. “This should be sufficient for another couple of years,” Mr Chhabra said.

Mr Chhabra said its next market would be in the North. Hence it plans to either set up a brewery or takeover an existing brewery to cater to Delhi, Haryana, Rajasthan and Punjab markets. APBL is learnt to be in talks with Mohan Meakins to acquire its business in the North.

Mr Chhabra said even though the company entered India a year ago, it did not have enough capacity before launching a brand in the market. “It took us a year to do that. We are going to launch more products soon,” he said.

He said Baron’s Strong Brew which will initially be sold in Maharashtra in 650 ml and 330 ml bottles priced at Rs 70 and Rs 38 respectively, should be able to carve out a market for itself in the premium end of the category.

“We have tried to premiumise the section. There are no other international premium end products. Hence the market is new and we will watch how the market develops,” Mr Chhabra said. Strong beer in India has been outpacing the milder variety at 2:1 ratio and is forecast to grow 18 per cent over the next five years.

Mr Chhabra said the Indian market provides an enormous opportunity for the company. “It is an exciting market to be in. The market is growing at 20-30 per cent and if it grows at the same rate, in another 10 years, the market should double every three-four years,” he said. India’s per capital consumption of beer is a mere 1 litre and the total market size is about 140 million cases (11-12 million hectalitres). United Breweries and SAB Miller have over 90 per cent share of the beer market in India.

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