The Hindu Business Line : Cobra Beer earmarks $80 m for expansion

New Delhi, March 25 The UK-based Cobra Beer is looking at both the organic and inorganic mode to spawn growth in India. Upping its ante, the global beer major said it has earmarked $80 million for its expansion which includes adding two new breweries.

“We are looking at both acquisition and greenfield projects to strengthen our presence here. Our aim is to sell 20 million cases annually by 2012 in India,” Mr Karan Billimoria, founder-owner of Cobra Beer, told Business Line. The company currently has seven breweries in India in Goa, Bihar, Orissa, Madhya Pradesh, Uttar Pradesh, Rajasthan and Maharashtra. It is adding two new ones in Karnataka and Andhra Pradesh.

Bullish on India

The beer major, with a global turnover of $400 million, said India is high on its radar for all its future expansions. “India will be a very important market in the future. It is also witnessing a high growth rate. We are in talks with a brewer for acquiring a majority stake, similar to the one we has acquired in Bihar — Iceberg,” he said adding “the process will take a couple of weeks before it can be announced.”

The company is also looking to introduce some of its premium brands in India, he said. Currently from its global portfolio of 35 SKUs, only four are present in the Indian market.

“The Indian beer market is slated to touch the 200-million-cases mark and we are targeting about 10 per cent of the market. In volume terms, India is bound to overtake UK in three years. This market can be tapped with niche variants such as premium and low-calorie beer,” Mr Billimoria added.

On banning of surrogate advertisements, he said prohibition has not worked in any market and the Government must realise that deregulating the industry will benefit the economy at large.

On the shortage of barley, Mr Billimoria said, the company was mulling the possibility of contract manufacturing of barley in the northern belt of the country to offset the shortage and thus having the backward integration advantage.

He said the company is also increasing its distribution channel, besides tapping the modern retail outlets. “Wherever we find opportunity, we will mark our presence.” Currently, the company is expanding its presence in southern India.

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