INDIA – Bira 91, an Indian craft beer maker, has raised US$70 million in a series D funding round led by Japanese beer company Kirin Holdings Co. Ltd as it aims to cement its leadership position in the premium beer market.
The company is seeking to ramp up production amid strong demand for alcoholic beverages. IMARC Group forecasts the India beer market valued at INR 350 Billion in 2021 to reach INR 580 Billion by 2027, exhibiting a CAGR of 8.3% during 2022-2027.
The growth in the Indian beer market can be attributed to the increasing preference for alcoholic beverages among consumers, especially millennials, during celebrations and social and cultural gatherings.
In line with this, the changing lifestyle of consumers, along with rising brand consciousness regarding imported and premium beers, the increasing adoption of canned beer, due to convenient transportation, handling, and longer shelf-life, is positively impacting the market growth.
Micro and craft breweries are offering beer to their customers in customized and tropical flavors, including peach, strawberry, apple, lime, and pineapple which is contributing to product innovations, providing a thrust to the market growth.
Bira did not say what its valuation or Kirin’s stake would be after the funding round but said it would use the funds to build new breweries and expand existing facilities, increase the company’s distribution footprint and further bolster Bira 91’s product development and innovation capabilities.
Kirin, which first invested $30 million in Bira for an under 10% stake last year, was set to pump in the additional funds for an around 15% stake at an equity valuation of $450 million, Reuters reported in September.
Launched in 2015, Bira 91 currently has a portfolio of 10 diverse flavors, along with many seasonal beers released in its tap rooms.
As one of the youngest players in the market, the brand has secured a double-digit share in several key markets and emerged as the fourth-largest beer company in India. It has a presence across 550 towns in 18 countries.
Recently, Bira reported an operating loss of $4 million in the quarter to June 2022, although net sales revenue was 132% higher at $20 million, according to an internal investor presentation seen by Reuters.
The new funding comes at a time when alcohol companies in Japan are facing a steady decline in revenue from alcohol sales after the younger people opted to drink less, forcing the companies in the country to invest more overseas.
Kirin is increasing its investment in Bira despite the Japanese yen falling to multi-level lows, which makes international investment costlier.
Hiromasa Honda, Managing Director, Kirin Holdings Singapore said: “India has embarked on its Golden Decade of growth. As the fifth largest economy in the world, with increasing digitalization, and a stable, growth-oriented government, we are very excited to invest further in the “Make in India” journey for the country.
We believe that Bira 91 has the potential to preimmunize Indian beer through innovation by brewing the highest quality products for the country’s consumers. We also believe that over the long term, Bira 91 has the potential to break out internationally as a global brand.”
Bira 91 recently announced its goal to become the country’s first carbon-neutral beer company and has formed the B9-Kirin Center for Sustainable Growth based out of its New Delhi headquarters.