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How a name change cost Bira ₹80 crore. Here's why
This comes when the company which produces Bira 91 beer planned an IPO due to surging competition from microbreweries, craft beer makers, and global brewers.
Ahead of a planned 2026 Initial Public Offering (IPO), the company which produces Bira 91 beer changed its name to B9 Beverages Ltd from B9 Beverages Private Ltd. This name change turned out to be very costly for the firm as it was forced to write off ₹80 crore in inventory and halt sales for a few months, according to an Economic Times report.
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This was due to compliance issues till it registered a new product label. As a result, its sales fell by 22% and its losses widened by 68% in the financial year 2023-24, the report read.
The IPO plan came at a time due to surging competition from microbreweries, craft beer makers, and global brewers launching premium brands in India's growing market.
The company, which had said that beer needs high capital expenditure and working capital allocation to grow, planned the IPO to raise fresh funds for its growth plans.
The beer industry contributed ₹92,324 crore to India's Gross Domestic Product (GDP) in 2023 alone.
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B9 Beverages faced a net loss of ₹748 crore in 2023-24 and this loss surpassed even its total sales of ₹638 crore, according to the report.
“Due to the name change, there was a 4-6 month cycle where we had to re-register labels and re-apply across states which resulted in literally no sales for several months despite demand for our products," the report quoted Ankur Jain, the B9 Beverages founder as saying.
Bira started a decade ago by importing the Hefeweizen-style beverage from Belgium but started brewing in India later due to cost advantages. It eventually added half a dozen third-party breweries.
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Emerging brands like Bira contribute significantly to the sector not just through sales, but also by introducing innovative products and experimental approaches, according to the report.
“What these companies must bear in mind is that the appeal of a new different taste palate, whether wheat, dark lager, or craft is rooted in its uniqueness," the report quoted Vinod Giri, Director General of Brewers Association of India (BAI), as saying. “So, their growth ambitions and expansion strategy should resist temptations of a quick scale up to become a mainstream product. That will just dilute the uniqueness of the product in consumers' mind and would be neither here nor there."
