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.
Will Vietnam decide to use “golden share” to protect company brands?
The Vietnam Financial Investors’ Association (VAFI) estimates that the State would get $2 billion from the sale of two brewers – Sabeco and Habeco – alone.
However, some analysts believe that the value of the two enterprises, the leaders in the industry, must be much higher.
As for the other 10 enterprises, in which the State Capital Investment Corporation (SCIC) acts as the representative of the State, the value could be billions of dollars.
Vinamilk, in a document to state management agencies in late 2015, pointed out that if the State sells its stakes in the dairy producer at VND120,000 per share, it would earn VND64.9 trillion. If the price is at VND150,000 per share, it would earn VND81.15 trillion. This means that the State can expect the amount of $2.9-3.6 billion if sells all the Vinamilk’s stakes it has.
Meanwhile, some foreign investment funds believe the value of the dairy producer could be $4 billion.
Dang Quyet Tien, deputy head of the Ministry of Finance’s Enterprise Finance Department, affirmed that enterprises will have to list their shares on the bourse before the state’s shares are sold.
“It is necessary to list Sabeco’s and Habeco’s shares to find out their real value,” Tien said. “And when selling stakes, it is necessary to hire consultants to revalue.”
He explained that the share price on the bourse will be just for reference, and that the prices at equitization must not be considered as the official value. Only by doing so will the state be able to sell stakes at the best prices.
‘Golden share’ will protect Vietnamese brands
Experts have warned that the beat Vietnamese brands would disappear from the market if most profitable enterprises are sold to foreign investors.
Meanwhile, foreign investors, with their powerful financial capability, are the most potential buyers.
Tien from MOF said MOF is aware of the risk and is considering applying necessary measures to prevent this. One of the measures is the ‘golden share’.
Instead of holding the controlling stakes which allow the State to veto other shareholders’ decisions, the State can hold a ‘golden share’.
A golden share is a nominal share which is able to outvote all other shares. This means that any decision on changing brands must get approval from the golden share holder.
Golden share is held by a certain governmental organization. The issue is mentioned in the 2014 Enterprise Law.
Tien said ‘golden share’ is a method applied in many countries to companies which undergo equitization and transformation into stock companies.
5 Oct. 2016