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3-2019

Russia: Positions of Brewing Companies

The review contains an analysis of interim performance of brewers in the first half of 2019. There are rather dynamic changes behind a modest industry growth. Baltika is again experiencing a stage of volumes and market share slid due to competition with AB InBev Efes. Because of the price competition and presence expansion in the modern trade company #2. has come close to the leading position. At the same time sales of Heineken Russia have continued growing which makes the premium part of the portfolio heavier. The market premiumization trend had been also confirmed by import brands. MBC and Zavod Trekhsosenskiy have been the most successful among federal market players. The market share of independent regional brewers and Ochakovo have continued falling as they are being squeezed out by the market leaders at their competitive fields.

Ukrainian beer market 2019: companies and brands

In 2019 beer production and market have been still fluctuating about zero point. However, the past season was successful for brewers judging by the sales profitability. The price mix has improved due to rapid general market premiumization, as well as its particular aspect, the growth of import beer sales. By the season end AB InBev Efes improved its positions considerably. It turned out that consumers had not forgot Efes brands that had to leave the market, but started to recover rapidly. Against the stagnating market that meant sales decline of other companies, in the first place Carlsberg Group that most of all beneficiated from Efes exiting the market. PPB turned out to be stable to branding activity of its competitor and Obolon kept the same volumes and at the moment it is the absolute leader of the economy segment. The share growth of independent producers took place thanks to leading craft breweries, that so far do not have a big market weight, but they are rapidly gaining it.

Brewing industry in Kazakhstan 2019

During the first half of 2019, the majority of Kazakh brewers made their contribution into positive dynamics. Yet it was companies of the lower division, not the two transnational leaders that raised their production and sales. The shares of draft beer and aluminum can which is rapidly squeezing glass bottle out of the market, have been growing. The price segmentation has remained stable despite the substantial rise of retail prices and fluctuations of brand market shares, while the borders between segments have become blurred. The main events in the industry have been: the announced revision of the beer excise policy, launch of BeerKhan brand in the strong beer segment, and most important – purchasing assets of Shymkentbeer by Arasan.

Vietnam. Delayed state divestment, listing restrict growth of Sabeco, Habeco

Recently uncovered bad management practices at Saigon Beer, Alcohol and Beverage JSC (Sabeco) and Hanoi Beer, Alcohol and Beverage JSC (Habeco), the two largest beer companies in Vietnam in terms of market share, show that the longer they delay becoming public companies, the more they will lag behind competitors.

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At Sabeco, the Ministry of Industry and Trade (MoIT), the state’s representative in the board of directors, approved Vu Quang Hai, son of former minister Vu Huy Hoang, as general director in 2015. Hai was 25 when he assumed the post, giving up his two-year position as the head of a loss-making PetroVietnam subsidiary.

Meanwhile, the State Audit of Vietnam’s 2015 audit of Habeco showed that the company’s unorthodox accounting practice made the 2014 net profit of VND927.13 billion ($42 million) unreliable.

Habeco has subsidiaries in the construction and real estate sectors that run projects behind schedule, which means its investment practices are inefficient. A subsidiary, Habeco Haiphong, is not using the whole land area it is assigned to manage, which is a waste of government property.

The Vietnam Association of Financial Investors (VAFI), which asked the MoIT to explain the assignment of Vu Quang Hai to the post of general director in June, said that such use of personnel is tantamount to weak governance and weak management of state capital. VAFI also claimed that Sabeco and Habeco grew slowly over the past eight years, even though the field of beer, alcohol, and beverage in Vietnam has a lot of potential.

According to Nguyen Dinh Cung, head of Central Institute for Economic Management (CIEM), when leadership positions are assigned to people with no ability, companies will operate inefficiently.

Economist Le Dang Doanh and former head of the Development Strategy Institute Luu Bich Ho both agreed that only when the two companies become public and listed will they become more efficient.

Dao Van Hung, director of the Academy of Policy and Development, said that the private sector would do a much better job managing the two companies and that the government could reinvest its earnings from divesting from the two beer companies into infrastructure.

The state currently holds 90 per cent in Sabeco and 82 per cent in Habeco.

In the middle of May, leaders of Sabeco said they had proposed the government sell 53 per cent of its stakes currently owned by the state. As of now, there is no further information on this scheme.

12 Авг. 2016

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