10+1 trends of Russian beer market 2015-2017Despite of the moderately negative prognoses for 2017, the beer market can be stabilized soon. Yet the years of the negative dynamics have resulted in marketing being limited just to “optimization” and the art of balancing between price and volumes. Bigger supermarkets share means stronger trade marketing. These processes are connected to the majority of the described trends. At the same time, the federal brands inflation leads to searching for new tastes, sales channels and contact formats that expand the product range and diversify the beer market, but do not imply a substantial volume increase. Let us enumerate and further discuss the ten trends of the beer market we can see in 2015-2017 as well as the major event of 2017.
Beer market of Ukraine 2017In the first half of 2017, the Ukrainian beer market goes on decreasing slowly. Yet, the companies manage to compensate their lost volumes by raising prices and improving the sales structures. This results in the mid price market segment reduction while the sales of premium brands are rising. These processes are connected to position strengthening of companies Carlsberg Group and Oasis and the market share reduction of Obolon. Most of the novelties by the market leaders belong to craft or hard lemon categories.
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.
India. Maker of Kingfisher beer witnesses 13.5% growth in profit in FY16
United Breweries Limited (UBL), the country’s biggest manufacturer of beer, posted a 13.5 percent growth in net profit in the just concluded financial year. The maker of India’s top selling beer brand, Kingfisher, reported Rs 294.57 crore in profit in FY16 compared to Rs 259.53 crore in FY15. Revenue in the period under review stood at Rs 5,081.48 crore, a growth of 8.3 percent from Rs 4,692.29 crore reported a year ago.
“UBL’s primary volumes increased by 9 percent in the fourth quarter, with which the full fiscal year for UBL resulted in a volume growth in line with the industry growth,” said the company in a statement to the stock exchanges.
The beer industry recorded an 8 percent growth in the January to March quarter of the last fiscal, resulting in a 4 percent annual growth in FY16. UBL said it had achieved 50 percent market share as of March 2016.
UBL’s shares were trading down by 2.45 percent at Rs 745.20 apiece, in afternoon trade on Monday, while the benchmark Sensex was down by 0.36 percent.
Meanwhile, UBL made public that it has received an order from the Debts Recovery Tribunal, in Bengaluru, which directs it not to “pay/release” funds with respect to shares held by one of its directors. While no name was mentioned, it is fairly clear that the person in question is UBL Chairman Vijay Mallya, who claims to be living in “forced exile” in the United Kingdom.
“The company has received an order dated September 30, 2015, form the Debts Recovery Tribunal, Karnataka, Bengaluru, whereby the company has been directed not to pay/release amounts that may be payable with respect to shares in the company held by a director (including his joint holdings) and United Breweries (Holdings) Limited, without prior permission,” the company said it its statement.
Accordingly, the company said it “would withhold payment of proposed divided on aforesaid shares, which is subject to approval by the shareholders in the ensuing annual general meeting”.
The board of directors of UBL has recommended a dividend of Rs 1.15 per equity share of Re 1 for FY16. Mallya, through various Indian investment entities, holds 8,11,88,930 shares in UBL, which represents a 30.71 percent stake in the company.
More recently, on March 11, 2016, the company received another directive this time from the deputy commissioner of Income Tax (international tax), Bengaluru. The order requests the company “to create a charge in favour of the central government on any amount due or likely to be due to a director of the company, to the extent of Rs 67,980 lakh, relating to tax demands on Kingfisher Airlines Limited.” The company further stated that it has “accordingly withheld payment of Rs 161 lakh relating to director commission payable to the aforesaid director”.
16 May. 2016