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.
India. Select FMCG shares trade weak; HUL, Dabur, Colgate hit 52-week low
ITC, Marico, Emami, Dabur India, Colgate-Palmolive (India) and United Breweries trading lower by 1% each on the BSE.
At 11:36 a.m. S&P BSE FMCG index was up marginally by 0.13%, while NSE FMCG index down 0.08% as compared to nearly 1% gain in the benchmark indices.
Thus far in 2016, HUL, Dabur India, Godrej Consumer Products, Britannia Industries, GlaxoSmithkline Consumer Healthcare and United Breweries seen their market price decline by an over 10% each till Friday. The S&P BSE FMCG index dipped 8% and S&P BSE Sensex fell 6.4% during the same period.
ITC was down 1% at Rs 306, after hitting intra-day low of Rs 304 on the BSE. The company’s cigarette revenues for the quarter ended December 2015 (Q3) grew 5.7% year-on-year (YoY), while FMCG growth moderated to 7.1% YoY on sluggish demand and supply disruptions caused by Chennai floods.
Weak demand - particularly in rural markets – coupled with a price deflationary environment and supply chain disruption caused by heavy rainfall and floods in Chennai impacted revenue growth, ITC said in a statement.
HUL was up 1.4% at Rs 783, recovering nearly 2% from its 52-week low of Rs 770 touched on BSE in early morning trade. Colgate-Palmolive (India) down 1% at Rs 871, also its 52-week low, ahead of its Q3 earnings tomorrow.
Revenue growth for large multinational FMCG companies would remain weak on back of decelerating rural demand and economic slowdown. Further the withdrawal of tax benefits would impact net sales growth, said Centrum Broking in Q3 preview.
According to Elara Capital, despite favorable contribution from a late festive season aiding Q3 sales, volume growth does not bring a lot of cheer to companies.
A late winter this year that impacted sales of winter products, along with floods in Chennai and closure of India- Nepal border affected sales of FMCG companies, the broking firm said in a report.
25 Jan. 2016