Telangana Approves 15% Beer Price Hike From Feb 11 Amid Heineken’s United Breweries Row

United Breweries, which produces popular brands like Kingfisher and Heineken, holds a dominant 70% share of Telangana's beer market.

The revised pricing is expected to provide relief to manufacturers who have been grappling with financial losses due to stagnant prices since the 2019-20 fiscal year.

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Telangana government on Tuesday approved an increase in beer prices in India's top beer consuming state. The decision, which mandates that existing stock be sold at the revised rates, came in the wake of a temporary supply halt by United Breweries, the Indian unit of Heineken, over pricing concerns, reported Reuters.

The directive was issued by Principal Secretary SAM Rizvi on Monday, following recommendations from the Price Fixation Committee, as per a report on Telangana Today. The revised pricing is expected to provide relief to manufacturers who have been grappling with financial losses due to stagnant prices since the 2019-20 fiscal year.

United Breweries, which produces popular brands like Kingfisher and Heineken, holds a dominant 70% share of Telangana's beer market. Last month, the company suspended supplies to Telangana Beverages Corporation Limited (TGBCL), the state-run liquor distribution entity, citing "significant and ongoing operating losses." The suspension disrupted beer availability in one of India's largest liquor markets, affecting both consumers and retailers.

In a statement, United Breweries highlighted that despite repeated efforts over the past two years, there had been no increase in the base prices of its products. The company's decision to halt supplies underscored the financial strain faced by breweries operating in the state.

The Telangana government's alcohol distribution model involves purchasing liquor from manufacturers and supplying it to retail stores, as per the report. Recently, officials had also rationed supplies to prevent hoarding and address shortages, further complicating the situation.

Last month, the price of beer was increased in Karnataka in order to help with the recovery of the reported revenue shortfall in the excise department. The hike ranged from Rs 10 to Rs 45 per bottle such that a bottle of beer costing Rs 230, with the implementation became Rs 240.