Industry: Brewing Trouble

Business Today|July 12, 2020

Industry: Brewing Trouble
India’s nascent microbrewery industry is facing the double whammy of lockdown blues and high taxation
RUKMINI RAO

Craft beer market in 2014

0.15 million litres

Craft beer market in 2019

43 million litres (microbreweries are a small part of this)

Beer market in 2018

2.4 billion litres

Expected size by 2023

3 billion litres

250-275 Number of microbreweries in India

$23.5 billion

Expected size of the Indian beer market in 2024

for a lot of people visiting Bengaluru for leisure, the job is pretty cut out: Finding out the most happening brewpub in town for a taste of house specials. And if the brews aren’t interesting enough, hit the next one which, going by the sheer numbers in the city, cannot be far away. Even for a nascent segment such as brewpubs – pubs which have in-house microdistilleries that brew fresh beer and serve it in the premises – you know how well the city has taken to it when you see a handful of them even in an area like Jayanagar, considered an old and conservative part of the city.

But not everything is right in the microbrewery universe. The growth of this niche segment – started in Pune in late 2000, it found home in Bengaluru and caught on well in cities as far Chandigarh, Gurugram and Hyderabad over the next few years – is under threat. Lakhs of litres of beer has had to be drained out as breweries have been shut for months. Even in places where they have opened after the lockdown, the seating capacity has been reduced due to social distancing norms, and there are few customers. This, even as fixed costs such as rentals and equipment maintenance remain high. For an estimated 250-275 players in the craft-beer segment, the next 10-12 months will be all about surviving the slump.

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July 12, 2020