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Bira Essentials

Here in this research report, you will get:
- Bira IPO Review and Analysis
- Bira Pre IPO Details

- Bira Upcoming IPO Details
- Expected Bira Upcoming IPO Date
- Expected Price Band
- Management Details (Ownership)
- Business Model
- Key Ratios
- Peer Comparisons
- Financial reports (Profit and Loss Statements, Balance Sheets, Results, Growth, Valuations, Funding Rounds)

- Latest News (Articles and Videos)
- Upcoming and Past Events Details
- Rating and recommendations for the Company's shares (Whether to Buy/Sell/Hold)

- Bira (b9 Beverages Share Price). (Latest in Pre IPO Market)

Discover and get a complete analysis on B9 Beverages Private Limited (Bira Beer) - Management, Business Model, Financials, Growth, Valuations, Funding Rounds, News and get the latest updates on B9 Beverages (Bira 91) Share Price.

ISIN

INE833U01014

Face Value

₹10.00

Total Share

2,45,04,520

Total Income

₹463.64 Cr

Profit After Tax

-₹417.41 Cr

EPS

-₹105.45

P/E

-6.73

P/B

12.44

Market Capitalisation

₹1,739.82 Cr

Enterprise Value

₹1,787.40 Cr

Book Value

₹57.07

Intrinsic Value

₹1,101.00

Earnings Yield

-14.85 %

Sector

Consumer Staples

Sub-sector

Beverage- Alcoholic

Bira Growth

Compounded Sales Growth

30.49%

1 Year
69.98%

2 Year

Pro Only

Compounded Profit Growth

-209.09%

1 Year
-341.92%

2 Year

Pro Only

Return On Equity

-298.50%

2020
-72.94%

2019

Pro Only

About Bira

Bira 91 is a craft beer brand manufactured by B9 Beverages Pvt. Ltd. The company provides light beer, white ale, strong ale, blonde lager, IPA, and boom strong and classic beers. The company's first brewery unit was located in Flanders region of Belgium where a craft distillery was used to contract manufacture the beer with ingredients from France, Belgium, Himalayas and Bavarian Farms and the beer was imported to India. After initial success, the company thereafter began manufacturing the beer in India with the same ingredients. Made from wheat, barley and hops, the beer is available in draft, 330ml, 650ml bottles and 500ml cans.

It has quickly become the rage amongst urban millennials owing to its delicious beers, bold identity and a strong draft network.
In 2017, Bira 91 leaped across to New York City to begin its campaign in the United States. And in 2018, the brand started on its wider expansion in the Asia Pacific market by entering Singapore.
Bira 91 has built a strong portfolio of essential beers and aims to drive the global shift in beer towards more color and flavor.
The company now operates four breweries in India, and has offices in nine cities including New York City. Bira 91 is backed by Sequoia Capital and Belgium’s Sofina Capital.
Crafted with the creative urban drinker in mind — someone who likes to have fun and doesn’t take life (or beer) too seriously, the brand aims to disrupt the global beer world with 21st century technology and its playful monkey mascot.
Bira91 has 2.5% market share of Indian beer market and 10% of Premium beer market.
B9 Beverages Private Limited (Bira 91 Beers) was registered in 2015 it was incorporated as Divya Jyoti Coaching Institute Private Limited and renamed to B9 Beverages Limited on September 2015.

Bira IPO Details

In 2018, CEO Ankur Jain intended that in 4-5 years they are planning for Bira 91 IPO.

Bira Subsidiaries

B9 Bevrages SPRL - Country of Incorporation is "Belgium"
B9 Bevrages INC- Country of Incorporation is "United States of America"

Bira Business Model

Business model is same as the parent Company.

Bira Revenue Segmentation

Revenue from Sales of Beers.
Other Operating revenue

Interest Income on current Investment
Revenue generated from foreigh currency flucatuion

Miscellaneous other non operating income
Revenue generated from interest on fixed deposit

Bira Product & Services

Beer Brands :

Bira light (Light Beer)
Bira White Beer (All -day Craft Beer)
Strong (High intensity Wheat beer)
Indian Pale Ale
Bira Blonde (Extra hoppy craft lager)
Boom Strong (Rich and malty Munich beer)
Bira Boom (Crisp and Mild Session beer)

Bira Assets

Property, Plant and equipment comprises of 650 ML reusable bottles under the brand name of BIRA (“Proprietary Bottles”). The company has recognized substantial amount of intangible assets such as software, SAP during FY20.

Bira Industry Overview

Industry Statistics

Beer is one of the most popular alcoholic beverages produced by extracting malted cereal grain, flavored with hops, and brewed by slow fermentation

The beer market was valued at 5,533.73 Mn ltrs in terms of volume in 2020 and is expected to reach 9,004.74 Mn ltrs by 2025, expanding at a CAGR of 10.89% during the 2021 – 2025 period.
The maximum levels of beer consumption in India are observed in the southern states. The healthy growth rate for the beer industry is an indication of the huge potential of opportunities open for breweries and beer brands marketing and/or manufacturers in India.
Based on type, the market is segmented into strong beer, mild beer, and craft beer.

Strong Beer:

Strong beer contributed the largest revenue share in 2020, while the craft beer segment is estimated to be the fastest-growing segment over the forecast period
In terms of volume of strong beer, the market was valued at 4,379.87 Mn ltrs in2020 and is expected to reach 5,728.16 mn ltrs by 2025, expanding at a CAGR of 5.19% during the 2021 – 2025 period.
The Indian beer market continues to grow in line with expectations. Industry volumes grew at a CAGR of 8% during the last five years. There has been a trend of emergence of brew pubs in large cities such as Bengaluru, Pune and Gurgaon over the last few years.

Mild Beer:

The mild beer segment was valued at 1,098.53 Mn ltrs in 2020 and is expected to reach 1,599.79 Mn ltrs by 2025, expanding at a CAGR of 7.75%
A significant number of young consumers are showing preference for low or no alcohol content variants of beer over strong beer due to their increased health concerns.

Craft Beer:

According to a study conducted in 2018, more than half of Indian consumers like experimenting with new alcoholic drinks, and majority of them are willing to pay more for better quality alcoholic drinks.
Bira91, launched in 2015 in Indian market, has grown at a CAGR of around 406%,having volume market size of around 0.9 Mn ltrs in 2016, which has grown to 23.1 Mn ltrs in 2018.

Impact of Covid-19

In the wake of the pandemic the beer market was severely impacted.
There was a ban on the sale of alcoholic beverages for about 40 days during the first two phases of the lockdown.
The ban had affected both retail sellers as well as the manufacturers of beer.
Furthermore, the World Health Organization (WHO) associated alcohol consumption to weakening of immunity, which demotivated the consumers from buying beer.
The entire market experienced about 25% decline in sales in the first quarter of 2020 from the last quarter of 2019.
In August 2020, the CEO of B9 Beverages, Ankur Jain, stated in an interview that, the company was at 70% of its pre-COVID-19 sales in May 2020.Trends: Tappi
Various states introduced COVID cess (an additional cess to fund extra spending due to the pandemic) on liquor, between 10% and 75%, which increased the overall prices of the alcohol including beer by a high margin.
In India, beer is taxed 60% higher than stronger spirits in spite of having a low alcohol level.

Trends:

Tapping into the health & wellness trend, the low- and no- alcohol category is likely to see some of the most innovation and evolution across the whole industry, offering consumers more variety, better tasting and higher quality products. The biggest challenge will come to wine producers, who will need to invest in R&D to create an alcohol-alternative that appeals in terms of both quality and taste.
Primarily driven by a demand for convenience, the e-commerce channel to be worth US $45.5 bn by 2024, significantly outpacing the growth rate of total trade over the next five years. China remains by far the biggest online market for alcoholic drinks, with a turnover of over three times the size of the next largest markets, France and the US.

Future Prospects

India is one of the fastest growing alcoholic beverages markets globally with an estimated market size of 52.5 bn dollars (about Rs 3.9 lakh crore), the Indian Council for Research on International Economic Relations (ICRIER) has said.
The number of people consuming alcohol increased from 21.9 crore in 2005 to 29.3 crore in 2018 and is projected to increase to 38.6 crore by 2030.
Pub and bar culture in India is escalating at significant pace, and is becoming more popular in the age group of 20-45. Further, the market is anticipated to grow at a CAGR of 10.9% over the forecast period as alcohol consumption is growing in urban areas of the country.
The global alcoholic-beverages market is expected to grow from $515.2 bn in 2019 to $528.5 bn in 2020 at a compound annual growth rate (CAGR) of 2.6%. The low growth is mainly due to economic slowdown across countries owing to the COVID-19 outbreak and the measures to contain it. The market is then expected to recover and grow at a CAGR of 7% from 2021 and reach $647.7 bn in 2023.
Based on product type, non-craft beers accounted for the largest market share. On the other hand, craft beers being the niche concepts in India have started growing for past few years and are beginning to take shape now.
Further, the craft beer segment is expected to reach US 900.0 million by the end of the 2030. Bira beer is emerging brand of Craft beer in India.
The share of the upper-middle income group in alcohol consumption has increased steadily from 7% to 21% and is expected to increase to 44% by 2030.

Some of the projects that are expected to get commissioned by the end of the current financial year are as follows :

Uttam Sugar Mills is going to commission molasses based distillery plant with capacity to produce 16.5 thousand kilo litres of alcohol per annum. The project also includes setting up of co-generation power plant of three mw capacity. The project will entail a cost of Rs.650 Mn. The project is likely to come up by year end.
Ganpati Sugar Industries will set up molasses based distillery unit in Chowtkur, Telangana with a capacity to produce 9.9 thousand kilo litres of alcohol per annum. It will also commission an electricity unit of two mw. This project is likely to come up by March 2021 and will cost Rs.574.5 Mn.
Centurion Industries is setting up a molasses/grain-based distillery at Abdulpur Munna in Uttar Pradesh. The plant will have the capacity to produce 19.8 thousand kilolitres of alcohol in a year.

Government Initiatives

Alcohol is a state subject and the aim of most state policies is to earn revenue from alcohol products. Most states derive around one-fifth of their revenue from alcohol taxation, which is their second largest source of income after sales tax.
Excise duty on alcohol is the third-largest source of own tax revenues for states, with an estimated contribution of 12.5 per cent in 2019-20. The state goods and services tax (SGST) and sales tax/value-added tax on petroleum products are the largest sources of revenues for most state governments.
The Ministry of Food Processing Industries which is the Central Government Nodal Agency on Alcohol Policy had set up a “Joint Working Group on Rationalization of Excise Policy and Taxation” in December 2001 and came out with a “Model Excise Policy and Excise Act” to be adopted and implemented in all the States and Union Territories in the Country. The Ministry has called for public opinion on the new Model Policy through press advertisements in June 2005. However, the Government is yet to take a final decision with regard to the Draft Model Policy and Excise Act.
The Ministry of Social Justice and Empowerment which is the Central Government Nodal Agency on Demand Reduction had set up a Sub Committee under the National Consultative Committee on De-addiction and Rehabilitation (NCCDR) in February 2009 to prepare a National Policy on Substance Use. A Draft Policy was developed and after being reviewed by expert groups, it was submitted to the Parliament Subject Committee in 2012 and awaits final approval of the Government.

Bira Awards & Achievements

Bira 91 has won the Europeon Beer Challenge 2020. It bagged five medals across categories.
Bira 91 has been awarded the prestigious Asia Beer Challenge Award 2020.
Bira 91 a beer brand from India, bagged four awards at the World Beer Awards held in London in August, 2017. It has swept through the awards and each of its four beers – Bira 91 White (Wheat Ale), Bira 91 Blonde (Lager), Bira 91 Light (Low Calorie Lager ) & Bira 91 Strong (Strong Ale) have won in their respective country awards.

Bira Strengths

The revenue generated from sale of beer in 2020 is 457 Cr. and there is CAGR of past 3 years in sales is around 70%, which placed Bira 91 is in the top 25 craft beer brands worldwide by sales volume and the fastest growing beer brand in the world.
Company is spending aggressively to expand the capacity , the fixed assets has grown by 65% CAGR in the last 3 years because the company is in growing phase and expanding there business.
Company has raised $180 Mn in last 15 funding rounds and is backed by some lead investors.

Bira Shortcomings

The marginal ratios of the company are in negative. The company is in growth phase but management has to take some decision to maintain good marginal ratios.
The net profit as well as net profit margin is falling due to increase in employee and marketing related cost. Net profit margin currently at (105%) as compared to (63%) last year.

Bira Opportunities

The beer market was valued at 5,533.73 Mn ltrs in terms of volume in 2020 and is expected to reach 9,004.74 Mn ltrs by 2025, expanding at a CAGR of10.89% during the 2021 – 2025 period, hence provides a great market opportunity.
In India, beer is the second-most popular alcoholic beverage in the country, after whisky.
The total market consumption was about 100 million cases in 2005 which has crossed over 300 million cases in 2019.

Bira Threats

The governance and pricing models for alcoholic beverages vary widely across the states. The states through their excise policies, control the entire supply chain of alcoholic beverages from manufacturing and distribution to registration and retail.
Unlike other consumer products, advertising of alcohol is not permitted in the media. This restricts awareness of products and new launches. Alcoholic beverage companies have to take the resort of surrogate advertising, hoardings at alcohol vending outlets and sponsorship of sports/ music events, but the impact of ban on direct advertising does affect growth