Calcutta, March 16: Five-and-a-half years after it started its operation, Foster’s India — subsidiary of the Australian brewer — is rolling out its flagship beer brand, Foster’s, across the country.
Foster’s is being launched in Bengal now, and over the next few months, it is going to be rolled out in central India and the Northeast.
The company entered India in 1998 by setting up a brewery in Aurangabad, Mahrashtra. The unit cost Rs 60 crore and can produce up to 3.6 million cases (3 lakh hectolitres) of beer a year.
The company rolled out Foster’s in Maharashtra in 1998 and in Delhi two years later, but chose to focus on these two markets alone for four years. Over the last one year, Foster’s was launched in states like Andhra Pradesh, Karnataka and Orissa.
In the next few months, Foster’s would be unveiled in Rajasthan, Uttar Pradesh, Uttaranchal, Madhya Pradesh, Bihar, Jharkhand and the whole of the Northeast, said Pradeep Gidwani, managing director, Foster’s India.
He blamed the inter-state tariff barriers for Foster’s having to stagger its national rollout. “For companies like us that have only one production unit, the difference in price with other brands is substantial in some markets because we have to pay state taxes to import the beer,” Gidwani said.
“Though Foster’s is a premium brand — which sells at Rs 30 a bottle (of 330 ml) — the price differential makes life difficult for us. So we went only to states that have friendly policies — like Delhi.”
Last year, Foster’s sold close to two million cases of beer. This year, sales are expected to rise sharply, thanks to greater market penetration.
The states that it will not be able to enter are Gujarat, which is a dry state, and Tamil Nadu, which has closed its doors on brands registered after 1972.
The company does not expect sales to catch up with its production capacity in the foreseeable future. However, it has plans of using its unit in India as a production base for the market in West Asia. If that materialises, the company may have to scale up its production capacity.
