Kirin Holdings will reportedly invest $30 million in New Delhi-based B9 Beverages, as the Japanese brewer wants to tap into India’s growing craft beer market.
The Japanese brewer will buy a stake of under 10% in B9, the maker of India’s popular craft beer Bira, a Kirin (KNBWF) spokesman and Bira CEO Ankur Jain told Reuters. They declined to provide further financial details.
B9 had been in talks with international brewers – including Kirin – and other investors to sell a stake of up to 20% in the company, Reuters reported back in August.
Bira says it has a 5-10% share of the beer market in cities such as New Delhi, Mumbai and Bengaluru. The investment would allow Bira, which has posted losses in recent years and has been hit by the COVID-19 pandemic, to break even in the 2022 fiscal year which starts in April 2021, Jain said.
“The companies will be exploring business synergies,” Jain said, adding that the investment would allow Bira to accelerate plans to launch its products in Japan later this year.
He expected the deal to be closed over “the next few days.”
Shares of Kirin have soared 27% over the past three months and are now up more than 9% over the past year. (See KNBWF stock analysis on TipRanks)
In a bullish note, Goldman Sachs analyst Keiko Yamaguchi last month raised KNBWF to Buy from Hold and lifted the price target to $24.84 (5% upside potential).
Yamaguchi also added the stock to Goldman’s conviction list amid expectations that Kirin’s maket share of the beer market will increase and domestic alcoholic beverage margins will recover and improve.
Additionally, the analyst believes that Kirin’s Australia beer business looks more likely to benefit from a profit recovery.
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