India: Carlsberg exploring IPO of its Indian arm

Danish multinational brewer Carlsberg A/S is exploring an initial public offer of its Indian arm and has kickstarted initial discussions with potential advisors in yet another sign of a global MNC looking to unlock value in the domestic stock market, multiple industry sources in the know told Moneycontrol.

“A clutch of select investment banks have been invited this month to make pitches for the proposed listing. BofA Securities, Citi, Deutsche Bank, JPMorgan and Morgan Stanley are likely to be in the race,” said one of the persons cited above.

A second person added, “Carlsberg has been exploring an India listing for the past two years and now they have decided to move in this direction. The attractive multiples here are one of the key drivers.”

A third person told Moneycontrol that that these are early days and the exact details of the proposed India listing in terms of size and valuation haven’t been firmed up yet and there is no certainty that the deliberations will eventually fructify into a transaction.

All the three persons quoted above spoke on the condition of anonymity.

In response to an email query, a spokesperson for Carlsberg A/S said, "We are not commenting on rumours or speculations in the market.”

JPMorgan, BofA Securities, Citi and Deutsche Bank declined to comment. Moneycontrol has sent queries to Carlsberg India and Morgan Stanley but could not elicit an immediate response from them.

The proposed move by the Danish parent comes on the back of strong business performance, better trade working capital, and lower capital investment for Carlsberg India which registered a FY24 revenue exceeding Rs 8,000 crores with profits surging by 60 per cent to Rs 323 crore, according to a report by PTI. "Excise duty expense" in FY'24 was at Rs 4,877.8 crore, up 13.4 per cent, the report added.

Carlsberg’s portfolio in India includes brands like Carlsberg Green, Carlsberg Elephant, Tuborg Green, Tuborg Strong and Tuborg Classic.

The firm, which has 7 operational breweries in India according to its website, competes with Kingfisher maker and listed peer United Breweries ( an arm of Dutch major Heineken ) which has a market cap of Rs 47,470 crore ($5.37 billion) and global rival AB InBev, which backs brands like Budweiser, Corona and Hoegaarden.

Carlsberg group launched its first-ever IT Global Capability Centre (GCC) in Gurugram recently to bolster its presence in India.

The Indian unit’s parent highlighted the former’s role in the 2024 annual report.

“India is one of the key growth markets in Accelerate SAIL. It is an exciting beer market with a positive long-term outlook, driven by increasing disposable income, urbanisation, a growing ontrade and the increasing popularity of beer. We first entered India in 2007 and have since built an attractive business. Today, we have a no 2 market position and a market share of around 21 percent,” the report said.

The report also mentioned the consolidation of operations involving the India and Nepal markets, which was sealed last year.

It said, “On August 2, following several years of negotiations, we signed an agreement to acquire CSAPLH’s 33% shareholding in CSAPL and an additional 9.94% shareholding in Gorkha Brewery. Following the final closure of the deal on 29 November, the Group now owns 100% of the Indian business and 99.94% of the Nepalese business.”

“The full ownership enables us to accelerate investments in India with the aim of increasing capacity, expanding and developing the brand portfolio, and increasing distribution to capture the long-term volume and value growth opportunities in this exciting growth market,” the firm elaborated.