Som Distilleries Not In “Hurry” To Enter Telangana Market, Says MD After United Breweries Suspends Sales

Som Distilleries and Breweries Ltd. is not “in a hurry” to enter the alcohol market of Telangana and will assess the situation before making a final call, according to the company’s Managing Director JK Arora.

Arora’s comments come in light of competitor United Breweries’ decision to stop its beer supply to Telangana Beverages Corporation Limited (TGBCL) with immediate effect. The maker of the Kingfisher beer cited stagnant pricing since 2019 as well as unsettled dues from the state as the reasons for the decision.

“As a result, the continued supply of our beer to TGBCL has been rendered unviable,” UBL said in a press release.

Talking to NDTV Profit, the Som Distilleries MD said that his company will analyse whether the situation is favourable for it in the Telangana alcohol market.

“As regards our sales concern in entering that market, we are not in a hurry. We will see whether things are workable for us because if the opportunity comes, then we will decide,” Arora said.

The company received the state government’s approval for selling its beers in Telangana in 2024 but has no market presence yet.

“Nobody is finding it viable to enter the Telangana market. So, it is for the government to have serious thinking,” Arora noted, adding that United Breweries had done the “right thing” by suspending sales in Telangana.

The dispute between state-owned TGBCL and United Breweries highlights the monopoly that the organisation has in terms of the wholesale and retail vending of alcohol in the state. 

Talking about the financial strain that delayed payments cause to breweries and alcohol companies, Arora mentioned that the government must not hold them back.

“Madhya Pradesh makes the payment in one day. Karnataka makes the payment in one day, Odisha makes the payment in five days, and you (Telangana) are holding Rs 4,000 crore for nothing. Why should you hold that?” he asked.

The top executive further anticipated that after United Breweries, more alcohol players in the state may pull out their business.

Shares of Som Distilleries and Breweries Ltd. fell 4.1% to touch an intraday low of Rs 107.71 during Friday’s trade on the NSE. The stock was trading at Rs 111.25 at 12:53 pm, while the benchmark Nifty 50 was down 0.03% at 23,518.90 points.