SABMillers Africa prospects are looking healthy

SABMiller's Africa prospects are looking healthy

SABMiller's extension of its Chibuku beer brand, 'Super', is a likely "game-changer" for the brewer in Africa, according to an analyst.

In a note late yesterday (11 February), UBS said that SABMiller has the broadest footprint in Africa and is boosting that through "a modular approach into untapped areas, while introducing innovative and more affordable products," UBS said.

It added: "Chibuku Super is a possible future game-changer in this regard."

The UK-headquartered company launched Chibuku Super, a variant on the opaque beer that has a fixed abv of 3.5% and comes in PET packaging, in Zambia last September. The variant has a longer shelf-life than the core Chibuku brand,  which ferments in the packaging and expires after five days. 

Overall, the company has invested US$16m in the Chibuku brand over the past two years.

SABMiller is the "best placed" brewer to benefit from Africa's burgeoning beer market, UBS noted. Along with Castel, it has brewing operations in 37 of the 50 countries in Africa.

But, UBS predicted that SABMiller will focus more on volumes than price. "Due to the fact that most of these countries are still trading well below their theoretical capacity levels and, given SABMiller's stated strategy of improving affordability within the beverage category, we expect SABMiller to focus its future attention more on volume growth than on achieving real price increases," the note said.

Clear and sorghum beer makes up around 20% of alcohol volumes sold in Africa, whereas the continent's "informal alcohol market" accounts for around 74% of all alcohol drunk.

Expert analysis

Beer Market in Africa to 2017: Market Guide

Beer Market in Africa to 2017: Market Guide

Canadean’s, "Beer Market in Africa to 2017: Market Guide" provides in-depth detail on the trends and drivers of the Beer market in Africa. The quantitative data in the report (historic and forecast co...read more