The Hindu Business Line : UB group leads in battle for TN beer market

It has dislodged Mohan Breweries & Distilleries Ltd (MBDL) and traditional rival Shaw Wallace Breweries Ltd (SWBL) to take the top slot after being the number three player in the State market, which is among the top three beer-guzzling ones in the country.

The secondary sales figures in Tamil Nadu during the nine-month period of the current fiscal suggests that the UB group is ahead with 37 per cent market share followed by SWBL with 32.2 per cent and MBDL with 31 per cent.

United Breweries Ltd with Kingfisher beer individually accounted for 29 per cent share of total sales, while MABL controlled eight per cent share.

Both MBDL and the SABMiller-managed SWBL dropped share in a market where sales plummeted due to the standoff between the administration and the trade.

The State's beer sales reported a nine per cent decline in the period under review to touch 68.56 lakh cases from 75.14 lakh cases in the corresponding previous period.

The share of MBDL and SWBL came down from 35 per cent and 34 per cent respectively last year.

Meanwhile, United Breweries saw its market share climb up from 24 per cent to the 37 per cent it holds now.

MABL, in which UK brewer Scottish & Newcastle (S&N) holds a 40 per cent stake, improved its share from seven to eight per cent.

The sales in Tamil Nadu, the third largest market for beer after Andhra Pradesh and Maharashtra, is expected to improve in the coming months after Tasmac, a State Government body, took over the retail trade from December 1.

However, the December sales at 4.94 lakh cases were down seven per cent though the decline was below the April-to-December average drop of nine per cent.

As market conditions remained difficult, the mild beer segment suffered a 17 per cent decline while strong beer faredbetter with only six per cent drop in sales.

SWBL received a shock when the State Government decided to ban imports from neighbouring States, including Pondicherry, in July last year.

The company has no breweries in the State except a contract manufacturing arrangement with MBDL.

SWBL's Sica brewery in Pondicherry used to service bulk of the demand for its brands in Tamil Nadu till the State Government's axe fell on imports.

The UB group, on the contrary, has two plants in the State with installed capacity of 8.5 lakh cases a month.

As beer consumption peaks in the summer months, SWBL is expected to scour for more capacity in Tamil Nadu and could even initiate discussions with the UB group for a contract tie-up, according to sources.

More Stories on : Market Shares | Tamil Nadu | Breweries

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