Last Updated:
The re-printing of label of the products stalled the sales of B9 Beverages (the owner of Bira beer) for a few months; as a result, the company had to write off Rs 80 crore in inventory.
B9 Beverages Private Ltd, the owner of Bira beer, recently dropped the word ‘Private’ from its name to change the name to ‘B9 Beverages Ltd’, ahead of its IPO planning for 2026.
The phrase ‘What’s in a name’ from William Shakespeare’s play Romeo & Juliet keeps coming again and again for some reason or the other. Now comes a unique case where dropping one word — Private — from the company’s name costed B9 Beverages a total of 80 crore and widening of losses in crores.
What’s The Case?
B9 Beverages Private Ltd, the owner of Bira beer, recently dropped the word ‘Private’ from its name to change the name to ‘B9 Beverages Ltd’, ahead of its IPO planning for 2026. The name change had to be printed on all the products sold henceforth. So, the re-printing of label of the products stalled the sales of the company for a few months. As the inventory became unusable or unsellable due to the name change, the company had to write off Rs 80 crore in inventory.
As a result, the company suffered a direct financial loss and its FY24 losses increased by 68 per cent, according to an Economic Report report citing the company.
B9 Beverages faced a net loss of Rs 748 crore in the financial year 2023-24. Its losses during the year exceeded its total sales of Rs 638 crore, which was down by 22 per cent from FY23.
What Does B9 Beverages Say?
“Due to the name change, there was a 4-6 month cycle where we had to re-register labels and re-apply across states which resulted in literally no sales for several months despite demand for our products. While availability dwindled, we also saw policy and route to market changes in Delhi NCR and Andhra Pradesh, which accounts for more than a third of our sales,” Ankur Jain, founder at B9 Beverages Ltd, was quoted by ET as saying.
Consequently, sales fell to 6-7 million cases in FY24 from nine million in FY23.
According to its latest annual report, B9’s auditor said negative cash flow of Rs 84 crore and accumulated losses of Rs 1,904 crore, which eroded its full net worth, indicate the existence of material uncertainty that may cast significant doubt about the group’s ability to continue as a going concern.
A decade ago, Bira started by importing the Hefeweizen-style beverage from Belgium but later started brewing in India due to cost advantages though it eventually added half a dozen third-party breweries.
What Happens When A Company Becomes ‘Ltd’ from ‘Private Ltd’?
Public Company Status: It transitions from a private limited company to a public limited company, meaning it can raise capital from the public.
Minimum Shareholders: Requires at least seven shareholders (vs. two in a private company).
Compliance Burden: Increased regulatory requirements under the Companies Act, 2013.
Board Composition: Must have at least three directors (vs. two in a private company).
Share Transferability: Shares become freely transferable, unlike in a private company.
Listing Possibility: Can opt for listing on stock exchanges to raise funds.
Greater Transparency: Higher disclosure norms, including mandatory financial reporting.
