“Name change…resulted in literally no sales for several months…” says Founder Ankur Jain on BIRA91’s Rs 80 Crores Loss

A seemingly simple yet expensive name change has caused a major financial setback for B9 Beverages Ltd., the parent company of the popular craft beer brand Bira 91. The company changed its name from B9 Beverages Private Ltd to B9 Beverages Ltd in preparation for its 2026 IPO. This resulted in a lengthy re-registration process that put a halt to sales for a few months.

A Halt in Sales 

Ankur Jain, the founder of B9 Beverages, explained that despite ongoing demand, the brand was unable to sell in key areas for about 4-6 months due to the need to obtain state approvals and mandatory re-registration of product labels.

“Due to the name change, there was a 4-6 month cycle where we had to re-register labels and re-apply across states, which resulted in literally no sales for several months despite demand for our products. While availability dwindled, we also saw policy and route-to-market changes in Delhi NCR and Andhra Pradesh, which account for more than a third of our sales,” Ankur Jain was quoted as saying by ET.

Consequently, sales fell to 6-7 million cases in FY24 from nine million in FY23. In its most recent annual report, B9's auditor stated that the company's negative cash flow of Rs 84 crore and cumulative losses of Rs 1,904 crore, which eroded its entire net worth, show that there is material uncertainty that could create significant doubt and impair the group's ability to operate.

Bira began importing the Hefeweizen-style beverage from Belgium ten years ago. However, because of cost advantages, it began brewing in India and subsequently added six third-party breweries.

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BIRA’s Way Ahead

B9 Beverages is still hopeful about its prospects for recovery and expansion despite these challenges. By the next quarter, the company expects a turnaround with operational profitability.

“We had to write off Rs 80 crore worth of products due to the name change, directly impacting our profitability. However, growth is back since the third quarter, and we expect to make an operating profit by next quarter and have enough scale and size to raise capital by 2026,” - a company statement.

Although craft beer brands like Bira 91, Simba, BeeYoung, and Kati Patang have contributed to the transformation of the Indian beer market, industry experts emphasise that in order to maintain their niche appeal, they must carefully manage their expansion tactics.

The Director General of the Brewers Association of India (BAI), Vinod Giri, suggested that craft brands avoid the urge to expand too rapidly since this could undermine their uniqueness. 

“The appeal of a different taste palate, whether wheat, dark lager, or craft, is rooted in its uniqueness. Their growth strategy should balance investor expectations with the rate of consumer adoption,” he added.

Bira 91 needs to strike a balance between rapid expansion and financial caution as it approaches its 2026 IPO in order to maintain long-term market relevance and profitability.

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