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Telangana rations Kingfisher beer

The Indian state of Telangana has begun to ration supplies of Kingfisher lager due to a dispute over pricing between Heineken’s Indian subsidiary and state officials.

It was last week that United Breweries halted sales of beer to Telangana in southern India after the state refused to permit price increases of 33.1%.

At the time, United Breweries shared in a statement to Reuters: “Despite our continuous efforts over the past two years, there has been no increase in the base prices offered for our products. This has resulted in escalating losses, making our operations in the state unviable.”

Shares of the company dropped by 7% in the aftermath of the announcement.

It now seems that the suspension of sales has begun to bite for businesses, and beer drinkers, in Telangana, which has an estimated population of around 38 million and, as data from the Brewers Association of India reveals, buys approximately 500 million litres of beer per annum.

One liquor store owner in the city of Hyderabad, the capital of Telangana, told Reuters: “Today [Monday, 13 January] we got a notification from our depot that there is no Kingfisher beer stock anymore.”

Telangana has fewer than 3,000 liquor outlets, and permits to sell alcohol are granted through a lucky draw. Due to the shortage of Kingfisher, the state is now rationing how much beer it supplies to these outlets, according to retailers.

One insider claimed that, unless United Breweries begins supplying beer to Telangana again, the supply will run out in two weeks.

As well as Kingfisher, United Breweries also produces beers including Heineken, Amstel, Bullet, UB Export and London Pilsner for the Indian market. db has reached out to United Breweries for comment on the matter.

It isn’t just United Breweries that Telangana has taken issue with – Pernod Ricard is facing antitrust allegations from the state.

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