India can offer beer makers new market

By staff reporter

- Last updated on GMT

Related tags: United states, Europe

The Indian beer market has enormous potential according to a company trying to raise £4.5m to finance an expansion in the country.

Cobra Beer, reported the Sunday Times, is under the process of raising fresh finance to complete the purchase of a brewery in India and to develop the brand there.

The UK arm of the beer maker was put in administration in May, and subsequently bought out by a joint venture vehicle involving brewing giant Molson Coors.

Cobra’s Indian arm generated retail sales of about £5m in the year to March but recorded losses of £4m, while turnover is predicted to grow beyond £20m within four years.

In a report released last month, beverage research agency, Canadean, stated that while Europe and North America are putting the biggest drag on global beer sales growth, an upward trend is noted in the emerging markets of Asia and Latin America.

Asia now accounts for about a third of global beer sales. In 2008, sales growth slowed slightly but remained strong at 5 per cent as Chinese consumers, who drink about 7 in every 10 litres of beer sold in Asia, continued to spend more on beer.

This year China is expected to up its contribution to the global beer market, and is on track to account for almost 100 per cent of world growth in 2009.

In Latin America sales were also on the rise in 2009 with volumes increasing 3 per cent last year. Growth was fed by a 4 per cent volume increase in Brazil which is the fourth biggest beer producer in the world.

In 2009 Latin America and China may struggle to push the global market far above zero growth Canadean expects world figures to pick up again in 2010.

However, European beer consumption is not falling off the edge of a cliff and some market niches like real ale in the UK are booming.

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