With beer still being perceived as a ‘new’ category in India, Erik d’Auchamp, CEO, Mahou India says that the good thing is that beer is becoming more and more acceptable and appreciated By Kahini Chakraborty
Mahou San Miguel is a 100 per cent family-owned Spanish company and a leader in Spain’s beer industry. Headquartered in Madrid, Spain Mahou has 125 years of brewing experience, beginning with the birth of Mahou in 1890. In 2000, Mahou bought the brand San Miguel to certain parts of the world. Today, Mahou San Miguel brands are present in over 60 countries worldwide and produce more than 75 per cent of exported Spanish beer. Elaborating on the entry into the India market, Erik d’Auchamp, CEO, Mahou India informs, “We entered the India market in August 2012, when we signed a joint venture agreement with Arian Breweries & Distilleries. During this time, we learnt about the Indian consumer and the market here. This knowledge and experience encouraged us to go one step further and to take complete control over the development of our business in India. That is why two years later, in 2014, we took a qualitative leap forward in our internationalisation strategy by acquiring 100 per cent of the business, thereby establishing our first international subsidiary for Mahou San Miguel, known today as Mahou India. This made us the first company in the Spanish beer industry to operate in the country through its own production plant.”
Globalisation has been the key accelerator in Mahou San Miguel’s growth strategy, and India forms a significant part of this piece – an important step in the globalisation process. “The 100 per cent acquisition of Arian Breweries in 2014 is an essential element of our globalisation plan. India is the first country outside of Spain where Mahou has a fully owned subsidiary. Arian Breweries has been officially renamed to Mahou India and we have three products to offer to the Indian consumers – our flagship product, Mahou 5 Star, Dare Devil and Mahou Clásica,” he mentions.
The company’s efforts are centred on consolidating its activity in the India market and on continuing its growth in the country. “That is why we are working day in, day out, to optimise our operations, to achieve excellence in what we do and in the quality of our product, and to strengthen our team here. We follow the philosophy: launch, learn and scale. Currently, we are in the launch phase and are learning at each step of doing business here. The eventual pace will depend on the initial success, and most importantly on the application of our learnings. Our plan is to invest over 18 million euros in India over the next five years and be present in 12 states by end of this year,” he highlights.
Commenting on the business growth last year and expectations in the coming years, d’Auchamp says, “Our international business right now accounts for 14 per cent of our total volume. It has doubled in the last five years. Our vision is to reach a milestone of 20 per cent of international volume coming from outside of Spain by 2017- 2018. We expect that our business in India will grow aggressively between now and 2020,” he informs. According to him, the beer market in India today is equivalent to 27 million hectolitres. Per capita consumption is 2.2 litres.
“It has grown at a rate of 13 per cent over the last five years and it is expected that it will reach more than 37 million hectolitres in 2019, enjoying high single digit growth in the coming years. Beer consumption patterns have changed as have consumers’ tastes and preferences. We are seeing a more discerning consumer who appreciates taste. Beer is still perceived as a ‘new’ category in India but the good thing is that beer is becoming more and more acceptable and appreciated,” he states.