Bira’s parent company raises $10 million from MUFG Bank

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B9 Beverages, the owner of the Indian craft beer brand Bira 91, has raised $10 million from Japan’s largest bank, MUFG Bank, just months after receiving $70 million in a Series-D funding round led by Japanese beer company Kirin Holdings Co.

Bira 91 has announced a $70 million Series D funding round led by Kirin Holdings, a leading Japanese beer company. 

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The funds will be used to expand production, strengthen the supply chain, and improve innovation capabilities.

“When I look at this particular investment, I think the idea for us was to really get the most important and credible financial institution based out of Japan,” said Ankur Jain, founder and CEO of B9 Beverages, in an interview with Mint on Thursday.

“One of the things that we’re trying to build is a network of financial institutions across the world who can help us as we institutionalize our company and get to our next corporate milestone—of potentially going public,” Jain added.

The alcoholic beverages company’s priority over the next 12 to 24 months will be to scale up the business and ensure the brewer is at a scale where an IPO “becomes meaningful,” according to Jain.

However, timelines for an IPO have yet to be determined, he added.

Bira 91, which was founded in 2015, is backed by Sequoia Capital India, Sofina of Belgium, and Kirin Holding of Japan. B9 Beverages is owned by institutional financial investors who own up to 30% of the company. Jain declined to comment on the valuation at which the current round was raised.

Meanwhile, MUFG Bank executive officer Yasuhide Hayashi stated that the Indian beer market is booming due to factors such as changing consumer lifestyles, a growing preference for alcoholic beverages, and rising brand consciousness regarding imported and premium beers.

“Through this collaboration, we are excited to work with the Bira 91 team to further their growth story and expand their footprint in India and around the world.” “Hayashi explained.

The brewer recently entered the cafe-chain market after acquiring The Beer Cafe in an all-stock transaction in October. The move was made to strengthen its position in the pub and taproom market, as well as to build a large-scale direct-to-consumer platform focused on beer and innovation.

According to Jain, the two companies are in the “early stages of integration.” “This quarter, the company plans to open ten new locations. “In terms of cafe revenue, we’re already ahead of our pre-covid estimates. “We’re already ahead of our pre-covid numbers in terms of the cafe’s revenues. We are expanding the store network from the current 30 to nearly 60 to 65 before the end of fiscal 2024,” he said.

Companies are preparing for a strong summer with no preceding covid-19 wave to disrupt demand and supply. However, inflationary pressures remain as glass bottle and barley prices remain stubbornly high. Input costs for brewers have increased by 15-35% when compared to pre-covid levels.

“Many states have taken progressive steps to ensure pricing improvement. Some states are still a little obstinate. Most suppliers will be unable to allocate products if those excise departments and so on do not provide price increases,” Jain added.

Hard seltzers and ciders have also been added to the company’s non-beer portfolio. “For example, we do not intend to enter the spirits category. However, to maintain our focus on lower ABV (alcohol by volume) beverages, such as sparkling. “The idea for us is to really concentrate on the beer occasion,” he explained.

Bira 91 has a 5% market share in key Indian markets. It has five manufacturing facilities in the country and is available in 550 cities and 18 countries around the world.

Jain claims that their product will be available in 25 international markets by the end of the year. The company recently announced investments in a new greenfield facility in Uttar Pradesh, which is set to open in the summer of 2024.

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