Stage Set for Beer Brand Wars

Just ahead of the hot Summer, Andhra Pradesh is set for a fizz war of the beer kind with major brands, both new and old, making

a concerted pitch for the state.

Not surprising considering tipplers in the state are fast on their way to tipping counterparts in Maharashtra to the second

place where consumption of the guzzly is concerned.

Projected to touch a volume of 120 lakh dozens at a conservative 15 per cent growth rate for 2000-01, major brands are either

making a strong foray or expanding their markets into AP.

While Shaw Wallace is planning to introduce Lal Toofan very soon, Australia's Foster's beer has just hit the shelves in wine shops,

and according to market reports, Stroh too is looking at this market.

"The state is hot for most part of the year. And that is cool for us", Mr Pradeep Gidwani, MD, Foster's India told ET. Add the

fairly high level of education and Westernisation and there is high acceptance of beer in the society here, he says.

Shaw Wallace too is leaving no stone untruned in the impending beer battle in the state which perhaps boasts of the largest

number of beer brands at 19 strong and 20 mild varieties available here.

The company with its strategic partner GMR Breweries will be expanding capacity soon. Notwithstanding the highly regulated

market in the state, consumption has grown by 120 per cent in 1999.

The tremendous growth in beer sales has been attributed to the weather, the change in mindset towards beer consumption and

rising income levels, specially in the IT industry.

In 1999-2000, AP was said to be the third largest after Maharashtra and Tamil Nadu. Maharashtra was a million

hectalitres, TN was 850,000 hectalitres, and AP close with 800,000 hectalitres. According to Mr C P Nagpal, chief executive

of Charminar Breweries, AP is tipped to topple Maharashtra to take the top slot.

No wonder AP is turning out to be an attractive destination for new brands. "It's an extremely positive and big potential market.

The market is growing at 10-12 per cent in real terms," says Mr Gidwani.

Of 39.16 lakh dozens mild beer consumption during 1999-2000, Kingfisher bagged 45 percent of the market share, Golden Eagle 21per cent, Royal Challenge 24 per cent, and others (15 brands) 10 per cent.

Of a total strong beer volumes of 62.78 lakh dozens, Haywards 5000 has 43 per cent hold in the market, Haywards 2000 -six per cent, Knockout 26 per cent, Khajuraho 13 per cent, and other 16 brands 12 per cent.

But why did Foster's take so long to come to Hyderabad ? "As part of our India launch strategy, we wanted to cover Maharashtra

first and build foundation for expansion into other states. So we launched in Pondicherry next and now coming to Hyderabad," Mr

Gidwani adds.

Hyderabad alone accounts for 35 per cent of the lager beer sold in state. Surprisingly, the industrially backward Telangana

region accounts for 73 per cent, followed by Coastal 15 per cent, and Rayalaseema 12 per cent in the regional break-up.

Despite the general trend being "value drinking" and "bang for buck" approach, San Migeul and Foster's are trying to tap the

high-end segments where the focus is more on the brand image.

However, Foster's seems to be trying to appeal to both segments by positioning itself as all that Australia stands for -- sporty,

young, outgoing and affordable brand. If all goes well, Foster's hopes to set up a brewery unit in AP soon.