Telangana Rations Kingfisher Beer After Price Dispute with Heineken-Owned United Breweries

Telangana, India's largest beer-consuming state, is facing a severe shortage of Kingfisher beer following a pricing dispute between Heineken-controlled United Breweries and the state government.

United Breweries, which manufactures the popular Kingfisher brand, halted beer supplies to Telangana last week, citing delayed payments and the government’s failure to approve price hikes since the 2019-20 fiscal year. The company stated that the financial strain forced them to suspend operations in the state.

Telangana, where alcohol sales are regulated by the government, is now rationing Kingfisher beer to prevent hoarding and address the resulting shortage, according to liquor retailers. Madhusudhan Rao, a liquor store owner in Hyderabad, confirmed the supply crisis:

"Today we received a notification from our depot that there is no Kingfisher beer stock anymore."

Rationing Amidst Crisis

State-run depots and private outlets are grappling with dwindling inventories of Kingfisher beer. Some stores are reported to have just two days of stock remaining, while others may last up to 10 days. An industry insider revealed that depots across Telangana are likely to run out of United Breweries' products within two weeks if supplies are not restored.

United Breweries, which controls 70% of Telangana’s beer market, supplies approximately 60 million 12-bottle cases annually. The suspension has left beer retailers scrambling to meet demand during the peak sales period.

Pricing Disparities and Industry Challenges

The ongoing dispute highlights broader issues in India’s $45 billion alcohol market. The Brewers Association of India noted significant pricing discrepancies between states, with beer prices in Telangana capped at ₹300 per case compared to ₹500 per case in Maharashtra.

Major players like United Breweries, Diageo, Pernod Ricard, AB InBev, and Carlsberg are collectively owed ₹466 million in unpaid dues. These companies are also navigating regulatory hurdles, including antitrust investigations.

Telangana’s government accused United Breweries of employing “tactics” to pressure them into approving price hikes. A state-appointed panel is currently reviewing the price revision requests. However, officials have yet to comment on the crisis, leaving retailers and consumers in uncertainty.