UBL suspends beer supply to Telangana over price row

The beer maker cited frozen prices, unpaid dues and 40% rise in production costs since 2019

- Varuni Khosla

SE-listed United Breweries Ltd (UBL), maker of popular brands like Kingfisher, on Wednesday announced the immediate suspension of beer supplies to Telangana Beverages Corporation Ltd (TGBCL) due to significant and ongoing operating losses in the state.

The company said that despite two years of efforts to address the issue, there has been no increase in the base prices of their products, leading to escalating losses that have rendered their operations in Telangana unviable.

In a BSE filing, the company said it had decided to suspend the supply of its beer to Telangana Beverages Corp. with immediate effect as the corporation had not revised the basic price of the company's beer since FY20, resulting in escalating losses in the state and significant overdues remaining unpaid by them for the past supply of beer by the company.

TGBCL is a government-run organisation with exclusive control over the sale of alcohol in both retail and wholesale markets within the state.

It was formed in 2014 following its separation from the Andhra Pradesh Beverages Corp. Ltd.

In a statement, UBL said it had a fiduciary responsibility to stakeholders, noting that continuing to sell beer at a loss was no longer sustainable.