Foreign investors eye Vietnamese beverage market

An increasing number of foreign giants are eying the beverage market in Vietnam due to the country’s young population boom and high demand for fizzy drinks. 

With beer consumption increasing from 2.8 billion litres in 2012 to over 3 billion litres in 2013, Vietnam has become the biggest beer consuming market in Southeast Asia and third in Asia .

Foreign investors eye Vietnamese beverage market
Photo: vietbao.vn

Mutar Kent, Chairman of the Board and Chief Executive Officer of the Coca-Cola Company, said he sees a number of development opportunities and potentials in Vietnam, citing the country’s consumption of non-alcoholic drinks is only about 20 percent that of the world’s average level.

The company also owns other products in Vietnam such as Fanta, Sprite, Joy bottled water, Minute Maid fruit juice and Dasani mineral water.

In 2012, the company announced a plan to invest 300 million USD into Vietnam , raising its total investment in the country to 500 million USD in 2015.

In mid-June 2014, it inaugurated four new production lines in Hanoi and Ho Chi Minh City .

Another giant, PepsiCo, which entered Vietnam in 1991, is also expanding its investments in the market. In 2010, the company pledged to pour 250 million USD into Vietnam over the next three years.

In 2012, it bought the SanMiguel factory in southern Dong Nai province and inaugurated the PepsiCo plant in northern Bac Ninh province – the largest of its kind in Southeast Asia with 70 million USD in investment capital.

In April 2013, PepsiCo and Suntory Holdings Limited agreed to form a strategic beverage alliance in Vietnam , introducing Olong Tea Plus and Moutain Dew to the public.

PepsiCo, in particular, has produced a series of beverages such as Sting, Twister, Lipton Ice Tea, Aquafina and 7UP Revive.

Giants such as Danish Carlsberg Breweries and Thai Beverage Group (ThaiBev) are strengthening their market shares in Vietnam .

ThaiBev, owned by the third richest billionaire in Thailand , revealed its intention to buy the Saigon Beer-Alcohol-Beverage Corporation (Sabeco) for 2 billion USD.

It is also seeking a large number of shares in Vietnam ’s top milk company Vinamilk. The billionaire’s company F&N Dairy Investments Pte Ltd holds 11.04 percent of the charter capital and is now the second largest shareholder of Vinamilk.

Meanwhile, Denmark ’s Carlsberg hopes to increase its market shares of Habeco to 25-30 percent from the current 17.23 percent, but it is yet to realise the wish.

It owns 55 percent of the shares at a beer factory in southern Ba Ria-Vung Tau province and 60 percent at the Southeast Asian Brewery Halida. In 2011, the company bought Hue Brewery Ltd (Huda Beer).