Weeks after Heineken-controlled United Breweries halted its beer supply over pricing and non-payment of dues by Telangana, the company has now announced that it will resume its beer deliveries to the state.
United Breweries, famous for its Kingfisher brand, shared the news via an exchange filing, stating, “We wish to inform you that the company has decided to resume the supply of its beer to Telangana Beverages Corporation Limited (TGBCL) with immediate effect… This decision has been made in the best interest of consumers, workers, and all stakeholders involved.”
The company said the decision was made following a series of “constructive” talks with the Telangana government, which has assured that it will resolve the pricing concerns and clear outstanding payments on a “time-bound” basis.
United Breweries had suspended beer sales in Telangana on January 8, citing delayed payments and the state’s failure to approve price hikes that were pending since 2019-20. According to reports, the company was irked over the fact that while the Telangana government increased the retail price of beer, the compensation paid to manufacturers did not increase.
According to a news report, United Breweries took the decision to resume supplies after the state assured an increase in prices within 30 to 45 days, with outstanding dues set to be cleared in instalments over the next 12 to 13 months.
The Telangana government owes United Breweries Rs 658.95 crore, while the alcoholic beverage sector’s dues for the February to August 2024 period amount to Rs 3,900 crore, according to a news agency.
Earlier, United Breweries’ demand for a 33.1% price hike was rejected by Chief Minister A. Revanth Reddy terming it ‘pressure tactic’. The fallout led to the layoff of around 1,500 workers at UBL’s two units near Sangareddy.
Telangana is India’s top beer-consuming state, with United Breweries holding 70% of the market share, according to a Reuters report.