Heineken’s Indian unit, United Breweries, will resume beer supplies to Telangana, the company said on Monday, weeks after the firm halted supply over pricing and non-payment of dues by the state government.
Telangana is India’s top beer-consuming state, where United Breweries, which makes the Kingfisher beer brand, has 70% of the market share.
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“We have decided to restart our supplies. This is an interim decision in the interest of consumers, workers and stakeholders,” United Breweries said in an exchange filing on Monday.
The beer manufacturer said the interim decision was made following “constructive” talks with the government, which assured it would address the pricing and dues in a “time bound manner”.
Shares of United Breweries closed trade 5.59% up on the BSE on Monday to Rs 2,060.50. However, shares were still down about 3% since the supply suspension decision on January 8.
The decision to resume supplies comes as a respite for consumers in an otherwise stressed regulatory environment where global alcohol companies such as Diageo, Pernod Ricard, AB InBev and Carlsberg are demanding about $466 million (Rs 4,000 crore) in unpaid dues, experts said.
Global alcohol majors are also battling regulatory challenges including antitrust investigations.
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United Breweries, for instance, had cited delayed payments and a lack of government approval for higher prices since 2019-20, which hurt its finances, for halting sales to Telangana.
Alcohol is bought by the state government in Telangana and then supplied to shops, analysts said. Officials have been rationing supplies to deter hoarding and tackle shortages.
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