UB Spirits to enter China markets

Bangalore, Sep 19: The UB Group is all set to make a foray into China spirits market, with the UB Spirits Company shortly setting up a marketting office in Shanghai.

UB Group Chairman Vijay Mallya, talking to newsmen on the sidelines of the United Breweries Annual General Meeting said that he had identified the Executive who would head the Chinese operations.

He said initially the Group would market its liquor products in China. ''I had visited the country and looked around, there is enough space for our brands in the market'' he added.

Commenting on the expansion plans he said the United Breweries would invest Rs 400 crore to expand brewing capacity across the country in the next three years. The exercise would increase the capacity by 50 per cent he said adding that expansion of capacity was envisaged in Rajasthan, Uttar Pradesh, Orissa and Andhra Pradesh.

Replying to a question he said United Breweries would launch Kingfisher Wine within the next six months. He said beer and wine would gel well and all efforts would be made to encash on the super brand equity of Kingfisher.

Similarly UB would also be soon launching a premium beer brand ''UB Ultra'' to take head on the competition from multinational beer brands such as foster.

Earlier Mr Mallya told the shareholders that the Company's growth would not be hindered by the entry of multinationals. It enjoyed a 50 per cent market share and the brand equity of Kingfisher was so strong that its product could not be destablisied. He made a particular reference to the foray of SAB Miller and the possible entry of few other multinationals who were trying to take hold of Mohun Meakins, a leading North Indian beer brewer and said such attempts would not deter the growth of UB which had painstakingly built the super brand equity of Kingfisher.

He said Sab Miller had acquired the foster brand for a consideration of 120 million dollars. Such premium beer was available only in metropolitan cities and would not affect the Kingfisher growth, he added.

The AGM approved a special dividend of 7.5 per cent taking the total dividend for the year to 22.5 per cent Mr Mallya said that the Company had registered a 22 per cent growth last fiscal as against 19 per cent the previous year. During the current year also the first five months had witnessed a 22 per cent increase.

He did not foresee any drastic change in the excise policy of state governments that would have an impact on the Company's business.

UNI