Singapore-based Asia Pacific Breweries (APB) has reported a 34 per cent rise in third-quarter profit to S$473 million (approx Rs 1,430 crore) even as it incurred a loss of S$3 million (approx Rs 9.10 crore) from South Asia (India and Sri Lanka) because of a gestation loss from its greenfield brewery in Hyderabad and investments in brand launches.
“The expense of launching Tiger beer in the quarter offset the benefits of volume growth in the country,” Vivek Chhabra, regional director (South Asia) and director of group business development, Asia Pacific Breweries, said.
However, APB’s revenues in India (and Sri Lanka) grew by 77 per cent in the third quarter ended June 2008 compared with that in the previous year.
“The South Asia (India and Sri Lanka) operations contributed 5 per cent to the total sales of the company,” Chhabra said.
The company also bought the remaining 24 per cent stake from Chowgule group in Asia Pacific Breweries (Aurangabad) Ltd (APBA) for Rs 16 crore, making it a wholly owned subsidiary of APB. Chowgule exited the business to focus on shipping and mining business.
APB plans to invest Rs 25 crore to increase the manufacturing capacity of its Hyderabad and Aurangabad breweries.
It also has plans to revamp its Goa brewery, which it had decommissioned. “We have identified a new location for the brewery,” Chhabra said. The company is open to acquire more breweries in the country or starting another greenfield operation.
The 158-million-case (12 bottles in each case) Indian beer market is dominated by Vijay Mallya’s United Breweries with its flagship brand Kingfisher followed by SABMiller. APB has managed to capture 3-5 per cent market share in Maharashtra, Tamil Nadu and Delhi.
APBA is now focussing on national presence for its 3 beer brands – Tiger, Baron’s strong beer and Cannon 10000. The company has already crossed combined sales of 3 million cases for the 3 brands.
APB, a joint venture of Singapore’s Fraser & Neave and Dutch brewer Heineken, has over 40 beer brands in its portfolio.
