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.
Carlsberg aims to strengthen position in India – CEO
It was better than the 1.91 billion crowns loss forecast in a Reuters poll, and at 1210 GMT the share traded 3.9 percent higher for the day.
Below are comments from Chief Executive Cees 't Hart to Reuters:
ON 2016 SWING FACTORS
"We see the growth of the Asian division as an opportunity. We have a stellar growth in especially India. For us it is important to see if this strong growth in India is sustainable, by which we are building up a very attractive business pretty quickly."
ON DEVELOPMENT OF THE INDIAN MARKET
"India is like many countries in one country. We have been able to get into number one and number two positions in some states. Those are relatively isolated states. Almost like countries in Europe, or even more so as you have to pay import duty in some of these states.
"Once you have a position as number one or number two you are pretty well protected in such an environment.
"We need to strengthen that and grow to more states in order to increase our footprint in India. It is not an immediate profit bringer, but it can potentially be a growth bringer over the coming five to ten years."
ON 2016 GUIDANCE
"I generally feel that the guidance here at the beginning of the year is a realistic one.
"We assume the Chinese beer market will show an improving trend compared with the declining trend of the last two years. That needs to come through, of course. We are a bit more optimistic there.
"The Eastern European markets are expected to remain under pressure. The last couple of months the macro economics in Russia have not improved at all.
"So I will sincerely say this guidance is a realistic one".
ON MAKING ACQUISITIONS
"Our focus is on organic improvement in the company. It is too easy to say that we buy our way out of the issues we have. We need to improve in Russia. We need to improve our margins in Western Europe. We need to continue our growth, with costs as well, especially some capex in India.
"We have enough on our plate in order to do better.
"M&A is not on our top list".
($1 = 6.6086 Danish crowns)
18 Mar. 2016