United Breweries expects further price hikes in India's top beer-consuming state

United Breweries

14/02/2025 12:23

Feb 14 (Reuters) - United Breweries  UBBW.NS  may raise
beer prices further in India's Telangana, a top official said,
days after the country's largest beer-consuming state permitted
brands to do so for the first time in five years.
    The southern Indian state's decision on Tuesday came as a
much-needed reprieve for the company, which had briefly halted
its supply to the state.
    The Kingfisher beer maker, majority-owned by Dutch liquor
giant Heineken  HEIN.AS , had earlier this year said it was
facing delayed payments and a lack of government approval for
price increases for about five years.
    The company has a 70% market share in Telangana and brings
in 15% to 20% of its revenue from the state, where it is
currently not profitable. 
    United Breweries is "not fully out of the red" in Telangana,
CEO Vivek Gupta said on an earnings call, adding that the
company expects another price increase in the state in the
"very, very near foreseeable future".
    Separately, United Breweries also said beer sales in January
was weak, partly due to the supply halt in Telangana, even as it
added sales had rebounded in February. It did not directly
quantify the impact of the supply halt.
    On Thursday, United Breweries reported a 25% fall in its
quarterly profit, as inflation-wary consumers cut back on
spending on its cheaper beers in a few states including West
Bengal and Tamil Nadu.
 

 (Reporting by Ashna Teresa Britto in Bengaluru and Praveen
Paramasivam in Chennai; Editing by Leroy Leo)
 ((AshnaTeresa.Britto@thomsonreuters.com;))