Heineken Names Vietnam, India, China as Key APAC Growth Markets

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Summary · why it matters

Heineken is targeting Vietnam, India and China as its key growth markets in Asia Pacific, with six of its 18 global lead markets based in the region, APAC President Jacco van der Linden said on Bloomberg's "Insight with Haslinda Amin." In Vietnam, Heineken posted double-digit volume, revenue and operating profit growth in the first half, with the Heineken brand growing in the 40s this year after 20% rates previously, though van der Linden said that pace is not sustainable. In China, where consumption tipped in 2015 toward drinking less but better, the premium segment is outpacing mainstream and economy, benefiting Heineken and more recently Amstel through its long-term strategic partnership with China Resources. Rising fuel costs tied to the Iran war are pushing up input costs in Asia, where Heineken is more dependent on Middle East oil, and the company is passing 70 to 80% of inflation on to consumers while improving productivity 3-4% year-on-year. Van der Linden cited geopolitical tensions and the predictability of regulation and taxation as the biggest risks, and said Heineken continues to invest and expand in the region, including at its biggest APAC brewery in Vung Tau, Vietnam.

Impact on assets 6

Consumer Staples▲ · 2 stocks
Heineken
HEIA
± MixedDemandSupplyrelevance

Heineken targets Vietnam, India and China as key growth markets, with double-digit volume/revenue/profit growth in Vietnam and premium-segment gains in China.

Heineken Holding NV
HEIO
▲ PositiveDemandrelevance

As Heineken's parent holding company, it is indirectly affected by Heineken's APAC growth-market demand, though not directly discussed.

Real Estate▲ · 1 stocks
Materials▲ · 1 stocks