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Background
Bira 91 is a prominent Indian craft beer brand, established in 2015 by entrepreneur Ankur Jain, and was manufactured by the entity B9 Beverages Pvt Ltd. The brand quickly disrupted the Indian beer market, standing out for its diverse flavors, contemporary branding, and its focus on urban millennial geographical market. The company was able to attract marquee investors in its early funding rounds due to its aggressive pricing and marketing strategy and, its ability to capture the market.
With a 2026 Initial Public Offering (IPO) on the horizon, the company was required to transition to a public limited company as it was on the verge of surpassing the legal threshold of 200 shareholders. The company converted itself from a privately held entity into a public company, thereby B9 Beverages Pvt. Ltd. became B9 Beverages Ltd. on December 19, 2022.1 However, the transition to a public limited company invited a host of predictable problems that the management failed to anticipate.
Regulatory Impact
The Constitution of India designates alcohol as a state subject under the Schedule VII.2 Each State has its own set of legislations regulating the sector in a condensed manner, such as The Maharashtra Prohibition Act of 1949, Andra Pradesh Excise Act of 1968, Karnataka Excise (Sale of Indian and Foreign Liquors) Rules, 1968, etc. Due to the state-specific nature of alcohol regulations in India, this transition required the company to undergo re-registration of licenses, obtain fresh label approvals, and secure new clearances in every state where its products were sold, a process, both complex and time-intensive.3 The transition forced Bira 91 to pull out its products from circulation as the company "B9 Beverages Pvt. Ltd." was no longer a registered entity with licenses and permits to sell liquor.
The name change, led to the regulatory authorities treating the company as a newly established entity and it needed fresh set of licenses, approvals, permits, agreements etc. Post realisation, the company scrambled to rectify this err and apply for the same, but these processes being time-intensive, left the company stranded and bleeding. Bira was unable to legally sell its products for several months despite robust consumer demand. Inventory valued at Rs 80 crore had to be written off as existing labels conflicted with the company's updated legal name. Payment delays from distributors, retailer attrition, and swift market capture by rivals such as Simba, BeeYoung, and White Owl further eroded its position. Consequently, Bira's sales volume declined from 9 million to under 7 million cases in FY24, with revenue falling 22% to Rs 638 crore. Net losses surged to Rs 748 crore, surpassing the total income.4
While the name change invited an avalanche of problems, the company already undergoing several issues such as chronic cash shortages, underutilised breweries and operational inefficiencies.5 The company has been in a chronic cash crunch since its inception due to which their breweries were not functioning at full capacity. Many of the decisions being taken in the company were too centralized. With Bira's products off the shelfs, the company had nil income for several months and the company found it extremely difficult to stay afloat while tacking the regulatory hurdles to bring the product back to the market. In March 2025, Bira shutdown its largest production facility in Andhra Pradesh which contributed to 25-30% of its total output due to non-payment of excise dues. This led to a significant drop in the production of cases wherein while originally it produced 22 lakh cases per month, it dropped down to just 10-20 thousand cases per month.6
The onset of problems led to loss of investor trust, including loss of potential incoming investors.7 The employees of the company have also called for a change in the leadership of the company and have petitioned the Board of Directors and existing investors of the company.8 Allegations of corporate governance failure, lack of transparency and delay in payment of salaries and statutory dues have come to the surface. While the company is still in turbulent waters and in amidst of potential funding talks, it is essential to understand, how this beverage is on the verge of becoming stale.
Footnotes
2. Entry 8, State List, Schedule VII, Constitution of India.
6. https://unlistedzone.com/bira-91s-100-cr-rights-issue-strategic-lifeline-or-last-resort
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