Cobra Indian Beer Private Limited, a subsidiary of UK-based Cobra Beer Limited, has plans to set up a green-field brewery in Andhra Pradesh.

Cobra Beer founder and chief executive officer Karan Bilimoria told newsmen here in an informal chat on Friday that proposed brewery at Hyderabad would entail an investment of $ 10 million. The plant would have initial capacity of two million cases per year with an option to upgrade the capacities.

At the same time, the company is actively contemplating to acquire or tie-up with four to five breweries around the country as part of its plans to start brewing in India. The acquisitions/tie-ups would be finalized within the next six months to produce and market the premium Cobra beer brand.

"Indian beer market is highly regulated and it will grow only if it is deregulated. Per capita beer consumption in India is only 0.70 litre, as against 16.1 litre in China, 95.4 litre in UK and 160 litre in Czech Republic. Even if we compete with China, we will have a huge market and a lot of potential to grow," said the Hyderabad-born Bilimoria (42).

Cobra beer, now being imported into India, attracts a prohibitively high 400 per cent customs duty plus exorbitant local duties. India has to move towards deregulation by making beer a lifestyle product and increasing its per capita consumption.

This is important since the consumption of beer in India is very low at 77 million cases per annum. Andhra Pradesh is the second largest beer consuming state in the country.

According to Bilimoria, Cobra beer is one of the fastest growing brands in the UK, with a current turnover approaching 50 million pounds per year at retail value. It is sold in 5,000 Indian restaurants throughout UK and exported to 30 countries. With its headquarters in London, Cobra Beer Limited has offices in India, South Africa and USA.

"Cobra beer is brewed using only the finest ingredients—a unique blend of barley, malt, maize and rice. It is extra smooth, doubled filtered and less gassy with alcohol content of only five per cent," he explained.

The Cobra founder recalled that his great grandfather Italia started a small brewery in Warangal in the early 20th century. Later, Italia spread the business to Hyderabad and other places, including present-day Maharashtra. A graduate in law from Cambridge University and a successful Chartered Accountant, Bilimoria thought of blending his own desi beer when he found that beers abroad do not gel well with the spicy Indian food.

Bilimoria met India's top brew-master Dr Cariappa of Mysore Breweries to brew "the finest ever Indian beer." Cobra was first brewed in Bangalore in 1990 and exported to UK for seven years. In 1997, Cobra commenced brewing at Charles Wells in the UK. In 1999, Cobra Beer diversified into wine with the launch of General Bilimoria wine.

Cobra beer is now available in Hyderabad, New Delhi, Mumbai, Pune, Goa and Kolkata. It is sold in top outlets such as Tendulkar's, Bombay Gymkhana, Taj Group of Hotels, JW Marriott and ITC Hotels. "My target is to make the brand the number one premium beer to be sold in India. Already, it is the largest selling Indian bottled beer in the UK," Bilimoria pointed out.