The breweries in Vietnam – Focus on Habeco
July 2012 – Habeco, like Sabeco, is principally involved in the production of beer, beverages and spirits. It is also involved in the production of the associated packaging materials. Also like Sabeco, it is a subsidiary of the state run company VINABECO. However the two businesses behave as competitors in the marketplace.
There are a lot of dates to cover here so perhaps a chronology might serve our purposes.
1890 The Hommel Brewery built by the French
1958 Hommel Brewery rebuilt and named as Ha Noi Brewery producing various products such as Truc Bach, Hong Ha, Ha Noi, Huu Nghi
1993 Ha Noi Brewery became Ha Noi Beer Company with a capacity of 0.5 million hL
2003 Ha Noi Beer Company renamed as Hanoi Beer Alcohol Beverage Corporation (HABECO)
2004 Habeco’s corporate structure changed to create a parent company with subsidiaries located from the north to the centre of Vietnam
2006 Habeco had eleven subsidiaries including six breweries and one spirits producer (Halico).
2008 Carlsberg acquired a 16% stake in Habeco
2009 Carlsberg and Habeco signed a Memorandum of Understanding to increase Carlsberg’s stake in Habeco from 16.07% to 30%.
2010 Habeco chairman, Le Ba Co, said that his company is in ongoing negotiations to sell another stake to Carslberg, in line with this agreement but this has not yet eventuated.
Habeco is the second biggest mainstream player and depending on whose numbers you look at, has a volume share of around 14% share by volume. More than 20% of its beer production is Bia Hoi.
According to the VBA, its beer production volume in 2010 was 6M hL.
Habeco’s strength lies in its dominance of the northern market. The northern market is an extremely consensus-driven culture so it is hard for mainstream brands to penetrate.
Like Sabeco, as it competes only in mainstream and budget segments, it risks declines in its core mainstream and certainly Bia Hoi volumes as a result of increasing market premiumisation.
This “Focus on Habeco” is our third in the series of articles looking at the major brewing groups in Vietnam. We will have another article to release w/c 6th August 2012 with our “Focus on Carlsberg”, so please come back for that.
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