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India. Carlsberg launches super premium strong beer

The world's fourth largest brewer Carlsberg is positioning strong beer in the premium segment, a market so far restricted to mild beer. The Danish company will brew Carlsberg Elephant, a super premium beer to bet on strong beer which accounts for the lion's share of the market.

Unlike other global markets, as much as 80% of the 17 million-hectolitre (1 hectolitre = 100 litre) beer market in India is strong beer. This refers to beer with alcohol content higher than 5%.

But brewers have restricted launches in the premium to super premium segment to mild beer brands (those with alcohol content lower than 5%). Take SAB Miller's Foster's, Anheuser-Busch Inbev's Budweiser, United Breweries' Kingfisher Ultra and Carlsberg's eponymous brand. United Breweries is also slated to add Heineken to this segment this year.

Carlsberg, a late entrant in India, has aggressively expanded brewing capacity and launched a brand a year since 2009. Carlsberg Elephant is the India subsidiary's second introduction in the strong beer segment in year.

It's Tuborg Strong brand, positioned for younger consumers, has emerged its biggest brand by volume. It exceeded sales of 1 million cases in seven months of launch, the company said.

"There were no premium alternatives to trade up to in strong beer. Encouraged by Tuborg Strong's sales we expect consumers to trade up further," Carlsberg India MD Soren Lauridsen said. Carlsberg Elephant is priced at a 40% premium over Tuborg Strong at Rs 100-120 for a 650 ml bottle.

The Elephant name is inspired by elephant statues that man the entrance to its Copenhagen brewery.
The company said it may have to take a more educational path to build this brand in India. "We need consumers to try out the brand first as Indians have not been used to paying high for strong beer," Loridsen said.

The India beer market has grown over 10%, one of the fastest in the world which has enlisted strong competition from international players. United Breweries dominates the industry with more than half the market share followed by SAB Miller.

Carlsberg, which claimed which claims 6.2% market share (excluding Tamil Nadu) as of April, acquired control over 90% of its India operations after it bought out partner Lion Brewery Ceylon earlier this month. The Sri Lankan partner had said it was exiting the company because India investment requirement was high at $200 million over the next few years.

29 Jun. 2011

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