British Brewing Company has received an initial commitment of Rs 100 crore (around $14.2 million) from investors including NeoMile Capital in its first external equity fundraise, a top executive at the Mumbai-based premium English lounge bar told VCCircle.
The company plans to use capital to accelerate its growth and expand its footprint in Bengaluru, Delhi NCR, Hyderabad, Nagpur, Pune and Jaipur. It will also use the capital to establish over 30 new outlets and a microbrewery over the next 18-24 months.
NeoMile Capital is facilitating this private equity transaction for several family offices, Murli Ramkrishnan, group chief executive officer at the investment firm said.
British Brewing Company
At present, the company owns seven outlets and expects to add six more and a centralised microbrewery by the end of this financial year. “Our aim is to add 30 new outlets with over 500 distribution points for BBC’s craft beer by the end of 2022,” Ajit Dhumal, founder of British Brewing Company, said.
Dhumal added that British Brewing Company is looking to spend about $1 million from the current investment round to acquire a microbrewery in the vicinity of Mumbai.
“There are several stand-alone microbreweries that are struggling to find a go-to-market strategy and shelf space in bars. By offering our own products, we would be able to improve the margin and increase the top line,” he said.
He further added that the company may double its topline to about Rs 80 crore in the current financial year by adding new outlets funded by the equity raise.
The investment firm advises offshore family office funds whose investments are centered in sectors such as fast-moving consumer goods, manufacturing, technology and consumer. It also acts as a link between mainstream capital markets investors and high-quality last-mile lending institutions and businesses.
Ramkrishnan added that NeoMile is also helping British Brewing Company to raise capital from other high-net-worth individuals and institutional investors.
“We are in talks to raise more than half of the capital from few venture capital investors. The key focus is to be an active investor and adviser that partners with the management teams of portfolio companies to achieve growth and improve productivity,” he explained.
Ramkrishnan added that the firm expects the food and beverages segment in India to grow at a compounded annual growth rate of 10% over the next five years.
“We believe that factors like rising disposable income, improving demographics, rapid urbanisation and the evolving mindset of the consumer is creating an attractive market for investors,” he said.
Deals in the space
The alco-beverage space in India has witnessed several deals over the past few months.
In January this year, Indian liquor company United Spirits Ltd sold its Bengaluru-based wine subsidiary Four Seasons Wines Ltd for Rs 31.86 crore ($4.5 million) to Grover Zampa Vineyards Ltd and its investor Quintela Assets Ltd.
In September 2018, mead maker Moonshine Meadery secured seed capital from a bunch of wealthy individuals.
In July 2018, VCCircle reported that IIFL Asset Management Ltd invested in a craft-beer maker, marking the firm’s debut deal in the alcoholic beverages segment.
In June 2018, VCCircle reported that venture capital firm Saama Capital and early-stage investor DSG Consumer Partners invested in an alcoholic-beverage company.
In May 2018, B9 Beverages Pvt. Ltd, which makes craft beer under the brand Bira 91, raised Rs 335 crore (around $50 million) in a round of funding led by Belgium-based investment firm Sofina.
In 2017, White Owl Brewery Pvt. Ltd, a Mumbai-based craft beer maker, which also runs a gastropub in the city, has raised a fresh round of funding from a clutch of investors.
A month before that, Delhi-based Kaama Breweries Pvt. Ltd, which sells craft beer under the brand Witlinger, raised its pre-Series A round of funding.