Beer market of Russia 2016: PET goes to draftThe beer market of Russia was warmed up by the hot summer, but the preparation for large volume PET prohibition has already impacted it negatively. The year was successful for Efes, MBC and regional producers; Carlsberg’s positions were virtually stable but AB InBev and Heineken lost a part of market share having focused on the sales profitability. The dynamics of big brands was determined by how much the companies were willing to keep the prices down or by their promotional activity. In this context the economy segment of the beer market and sales of inexpensive draft beer were increasing. The premium segment started shrinking due to license brands migrating to the mainstream segment.
Beer market of Vietnam: “Young tiger”Vietnam is one of the few big beer markets that continue to grow steadily. The beer popularity results from its low price, street consumption culture, and social motives. The outlooks of beer market as well as the Vietnamese economy inspire optimism, though the country is heavily dependent on export of goods. The state regulation can be called liberal, but the key risk for brewers is harbored in intensive rising of excise. Within TOP-4 there are two leaders, Sabeco and Heineken that grow at the fastest rates. The first company effectively employs its capacities, the second one focuses on marketing technologies. Almost 80% of the market belongs to century-old brands, yet the middle class and the youth are shifting their interest toward international premium that is growing taking share from the mainstream.
Analysis of beer market in China (on Russian)
Beer market of Ukraine: big three losing weightIn 2016, fast increase of excises and resulting price spike stood in the way of the beer market stabilization. Most of competition (as well as mass sorts) moved to the economy segment of the market. The biggest losses were incurred by the leading three, especially Obolon, which again experienced pressure after reallocation of Efes market share. However, one should already speak of TOP-4. Group Oasis CIS (PPB) became a strong player and competitor to transnational companies. Besides the net sales of many regional medium breweries look rather good and 16-fold cost reduction wholesale trade license for craft brewers opens up a possibility of rapid growth in 2017.
Thailand. Cash-flush ThaiBev itching for big-ticket acquisition deals
Armed with its formidable $966 million cash pile, F&B giant Thai Beverage is forecasted to aggressively snap up Southeast Asian companies over the next four years.
According to a report by OCBC, the global beer industry has been awash with news of mergers and acquisitions of late, as more brewers turn to big-ticket deals to boost profitability and drive growth.
Thai Beverage is likely to go down the M&A path as well, particularly in light of the group’s Vision 2020 strategy.
“Following Fraser and Neave’s (FNN) sale of its 55% stake in Myanmar Brewery Limited to Myanma Economic Holdings (MEHL), FNN currently has a total cash of S$966m. We think that if necessary, FNN and Thai Bev partnering each other for potential acquisitions is a conceivable possibility,” said OCBC.
“We expect both entities to expand into their new markets - Myanmar, Vietnam, Indonesia and Philippines, but this would result in varying marketing expenditure as they strive to build brand presence in these countries, thus margins for the segment would be affected in certain quarters,” OCBC added.
In the meantime, ThaiBev will continue developing its core business, with new products being developed and distributed in its regional distribution network.
“We remain positive on the group’s long-term growth plans,” OCBC said.
14 Jan. 2016