The Hindu Business Line : Cobra Beer looking at Indian listing of subsidiary

Looking ahead
The company plans setting up its own greenfield brewery.
It plans to set up a brewery either in Andhra Pradesh or Maharashtra and another in the North.
Cobra recently acquired 76 per cent stake in Iceberg brewery in Bihar and has bottling arrangements with eight breweries across the country.

K. Giriprakash

Bangalore, April 14

The UK-based Cobra Beer is looking at an Indian listing of its domestic subsidiary as the company is set to invest up to $100 million by 2010 in its operations here.

Cobra Indian Beer’s Managing Director, Ms Poonam Chandel, told Business Line that the Indian IPO will happen only after the parent company gets listed sometime later this year in the UK. She said the company plans to invest up to $100 million by 2010 in acquiring breweries and setting up its own greenfield brewery in India. “We should have a clearer picture by June,” she added.

Brewery licence

Ms Chandel said the company aims to sell about 6 million cases in another two years in India, and hence, would need a brewery of its own, apart from several bottling arrangements in place. It already has a licence to set up brewery in Haryana. It plans to set up a brewery either in Andhra Pradesh or Maharashtra and another in the North. At current estimates, it costs about Rs 120 crore to set up a brewery in India, she said.

Cobra recently acquired 76 per cent stake in Iceberg brewery in Bihar and has bottling arrangements with eight breweries across the country. Both United Breweries, which sells the popular Kingfisher beer, and SABMiller, which sells Foster’s premium beer, control over 40 out of a total of 60 breweries in the country.

Ms Chandel, who was recently appointed as the head of the company’s Indian operations, said the presence of United Breweries as well as SABMiller, who together have more than 80 per cent share in the market will not hamper the growth of Cobra Beer.

“We don’t have much to lose. Being new to the market has its advantages. It is easier to create an USP,” she said.

Ms Chandel said Cobra Beer aims to target the younger generation of beer drinkers as they are usually open to try out newer brands. “We believe we have a better product and it tastes better, apart from having premium packaging,” she pointed out.

Cobra Beer has three brands currently which are King Cobra, Cobra Beer and the recently acquired strong beer, Iceberg. The company has a turnover of around Rs 100 crore in its Indian market.

The total size of the beer market in India is about 130 million cases per year and the per capita consumption is about 1 litre compared with about 23 litres in China.

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