Indian craft beer maker Bira 91 announced on Tuesday that it had raised $70 million in a funding round led by Japanese beer company Kirin Holdings Co Ltd. The company is looking to increase production due to the increasing demand for the alcoholic beverage.
The sale of craft beer in the country has been on the rise as younger consumers in big cities are opting for brands or pubs that can offer lighter brews and fresher ingredients. The company has still not revealed the stakes owned by Kirin after the funding. But the company will be using the funding to expand existing facilities, build new breweries, and increase its footprint, which now spans 550 towns in 18 countries.
Investment last year
The Japanese beer company had last year invested $30 million in Bira and had under 10 per cent stake in the company. According to reports by Reuters in September, Kirin was set to give additional funds for about 15 per cent stake at an equity valuation of $450 million.
Bira earnings and new goals
The new funding from Kirin comes after Bira reported an operating loss of $4 million in the quarter to June this fiscal year, while the net sales revenue went up by 132 per cent at $20 million. Bira 91 had recently announced that its goal is to become the country's first carbon-neutral beer company. The company has also formed the B9-Kirin Center for Sustainable Growth at its headquarters in New Delhi, where the experts from Kirin are helping Bira with its Net Zero goal.
Decline in beer market in Japan
In contrast for Kirin, the investment is at a time where they are facing a steady decline in revenue from alcohol sales because the younger people in Japan are drinking less and have forced the companies to move overseas. The company is increasing its investment in Bira despite the Japanese yen falling to multi-level lows, which makes international investment costlier.
