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United Breweries says elections disruptive for sector; expects industry growth at 6-8%

Updated : January 28, 2019 12:39 PM IST

Bengaluru-based United Breweries Ltd (UBL) on Monday said elections are always disruptive for the liquor sector and expects industry to growth at 6-8 percent.

In an interview to CNBC-TV18, Shekhar Ramamurthy, managing director, said, general elections in the peak summer season would be an absolute dampener for UBL and the year 2019 is not likely to start on a happy note.

Ramamurthy said during the elections disruptions occur as breweries are asked to operate in one shift. Also, closure of outlets on voting and counting days and checks on movement of stocks affect the sector, "However, the entire of 2019 is not going to be defined by elections and expect normal growth to come back post-elections."

UBL, the maker of Kingfisher beer, said the company hopes to grow faster than the industry on back of brands, portfolios etc.

Talking on increased excise duty by West Bengal, Ramamurthy said last January the state hiked duties on beer and prices went up by 35 percent and the industry declined by 50 percent and the consumers are not used to higher prices.

"However, West Bengal does not contribute much to the UBL's topline, so the impact on numbers are not much. However, any market that shows continuous steep decline for over a year is always a big worry factor,” he added.

"Premium brands like Amstel and Ultra are doing well along with new launches Kingfisher Storm and Kingfisher Radler. Premium products account for 10-15 percent of UBL's total volumes," he said.
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