United Breweries Volumes Jump 10.9% In Q4 | NDTV Profit
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00:00 Let's take a look at one of these stocks which has in fact come up with earnings and that's
00:04 United Breweries which is in focus which has reported a solid growth in its revenue and I
00:09 spoke to the managing director and CEO Vivek Gupta on what worked for the company and what we can
00:15 expect going forward. This is what he had to say. Listen in. We are very very pleased with our
00:20 quarter results. Our volume grew 11 percent, our net sales grew 21 percent, our premium volumes grew
00:27 21 percent and at the same time we actually see a margin improvement versus a year ago around 300
00:34 basis point. So I think we are very pleased with the progress. This is a long-term journey.
00:40 Beer is a very highly capital intensive business. We are making interventions to make sure our
00:45 business is future ready. At the same time we are actually really focusing on consumer,
00:52 solving our portfolio gaps, launching new innovation in the market. So I'm very pleased
00:57 the way the quarter has gone. Of course there are challenges. I think we continuously need to work on
01:04 ensuring that the volatility around commodity pricing, around bottle pricing, glass pricing,
01:10 we need to watch. This quarter because of elections there's definite disruption
01:16 and as a market leader with almost 50 percent market share we get more impacted when there
01:23 are disruptions due to elections. So we need to see the impact of that but overall very pleased
01:27 with the way the quarter has gone. Right. Vivek in fact that was my very next question. You seem
01:33 to have preempted it. The seasonality impact. Now on one hand of course you have summers and summers
01:40 in general are good for the beer industry. On the other hand of course you'd have several dry days
01:45 coming in on account of the election season. And in your experience in the past what has and how
01:52 have things spanned out and what are your expectations this time around for the first
01:56 quarter going by, coming through? I would say that you know as you said it is coming out to be a very
02:03 hot summer and there is definitely an increase in demand of the beer. At the same time we are seeing
02:09 a lot of disruption because of elections. In some of the states where you know we are only operating
02:13 with two shifts in our brewery versus three shifts based on the approvals we have. So I expect that
02:19 things will improve post elections and election is also in phases so some states have multiple impact
02:24 but from a fundamental consumer point of view the category is looking very strong.
02:28 And I think post elections I do see you know continuous momentum on the category and on our
02:35 business as well. Right Vivek let's talk about your premium segment then and I believe that you guys
02:40 have reported a 21% growth there in that particular segment backed by Kingfisher Ultra and Kingfisher
02:47 Ultra Max. These are the two beer brands that are in fact working in your favor at the moment.
02:52 My question here is that is that where the focus is or is this just something that has come through
02:58 organically for the company. What's the way forward here and is there where this is,
03:03 is this where which is in fact going to lead to higher premiums perhaps also lead to perhaps
03:10 better margins going in? Now as I mentioned previously as well our focus is on serving
03:15 consumer whatever they want and our focus is not only on premium or mainstream it is on economy
03:21 where we can afford it, it is on premium you know where we have production and we have availability
03:26 and also in future we will also launch more brands in various segments. So for example in
03:31 in Karnataka we launched a mainstream economy brand with London Pizzeria which actually is
03:36 driving trade up from the economy segment and is doing extremely well. We launched Queenfisher
03:41 which was which is driving category growth and we are getting very good results in Goa.
03:45 At the same time you know we we are consciously expanding our portfolio across the states and our
03:52 growth has come behind Ultra and Ultra Max but also our Hennigan Silver brand wherever it is
03:57 present and distributed is doing extremely well as well. So it's a very conscious strategic choice
04:02 to expand our portfolio across states, across spheres and give consumers what they want.