Mixed Brew

Brewers lead the beverage index this month but some are fairing better than others

Chinese brewers Tsingtao are out in front this month, leading a number of brewers in the top five, with an increase in share price of over 24%. Anadolu Efes’s price reflects continued growth, domestically in Turkey, as well as in its international market. The Turkish brewer and soft drinks company has also continued to expand operations, most recently acquiring a majority of Russian brewing company KV Group.

Other top beer performer Femsa has obviously benefited from a number of recent management changes. Like Anadolu Efes, Femsa also has a significant stake in Coca-Cola bottling.

Not all breweries are doing that well, however. US giant Anheuser-Busch’s price fell by more than 6%, and Sapporo Holdings, with a significant part of its interests in beer, declined by 12%.
In the soft-drinks business, Canadian  supplier Cott Corporation declined significantly. Cott experienced a difficult year last year, with rising commodity costs and shifts in consumer habits. In Australia, Coca-Cola Amatil experienced a lesser, but still significant decline in share price.
The graph below shows that, despite the world market remaining fairly constant, showing only a slight increase, the emerging markets are continuing their promising climb.

These emerging markets started to show promise in June last year and are showing no signs of slowing down.

Methodology:
MSCI builds its indices from the industry level up by classifying securities by country of domicile; determining a Foreign Inclusion Factor (FIF) for each security; classifying securities according to the Global Industry Classification Standard (GICS®) into: Sectors (10), Industry Groups (24), Industries (62) and Sub-Industries (132); screening securities for size and liquidity; and finally, initiating security selection process to target 85% free float-adjusted market capitalisation for each industry group, within each country.

db  March 2006