1. 1
The opinions presented above reflect the personal views of the author as such should not constitute as investment advice. The
summary is purely intended to be illustrative of the author’s prior experience in investment note writing.
Myanmar awakening
Myanmar is rising from a deep slumber. The recent lifting of the US and EU sanctions has rendered
the country a sanctuary for growth particularly for sluggish consumer companies in the West. While
growth opportunities for consumer companies in Myanmar are in abundance, the scope of this
analysis is the country’s booming beer industry.
Beer consumption in Myanmar is currently at a paltry 3.2 litres per annum1. Some may attribute this to
the country’s per capita income of $1,203 per annum which is one of the lowest in South East Asia
along with Cambodia2. However, compared to Cambodia, whose per capita income is even lower at
$1,160, Myanmar’s beer consumption per capita is less than one fourth to that of Cambodia’s 14
litres3 per annum. A comparison of Myanmar to Cambodia serves another purpose. Cambodia, similar
to Myanmar has risen from isolation when it opened doors for investments in 1995. The author
believes, Myanmar could follow the footsteps of Cambodia should the right infrastructure and
regulatory support converge.
One would argue, why beer? Empirical studies have shown that demand for consumer staples such
as packaged food and alcoholic drinks typically soar when economies are liberalized. For example,
Sri Lanka’s beer consumption grew at a staggering 37% value CAGR during 2009-2013 following the
completion of the country’s internal civil war in 20104. This is in excess of five times the country’s
average GDP growth rate over the same period5. Similar comparisons could be drawn with Cambodia
and Vietnam. Myanmar’s alcohol consumption has traditionally been suppressed by its poverty and
Buddhist temperance. However with the recent economic liberalization, these numbers are about to
change.
So what? For international investors, opportunities are scarce in Myanmar owing to a lack of publicly
listed companies in the country’s recently introduced stock exchange6. However, there is one silver
lining, Myanmar Brewery Limited (MBL). A partnership between Kirin Holdings Company (TYO: 2503,
55% holding) and the Union of Myanmar Economic Holdings (UMEHL, 45% holding), MBL controls
about two thirds of the beer market in Myanmar7 via its signature brands such as Myanmar beer,
Myanmar Double Strong and Andaman Gold. These brands have a strong following within the country
to the extent that Myanmar beer is almost synonymous with the word “Beer”. The author believes that
for those investors “testing waters” in Myanmar, investment in MBL via Kirin Holdings Company
presents a remarkable opportunity. MBL is protected by considerable moat in the form of a strong
distribution network and government support. MBL’s volumes provide scale benefits translating to low
entry price points in to the market which no local or international player could afford to match8. In the
wake of severe political turmoil that has plagued Myanmar in the past, MBL has been a rare sign of
solidarity of the country’s economic prospects.
International players such as Heineken and Carlsberg have already taken interest in Myanmar as
evident by their setting up of factories in the country. The Myanmar beer market is 163 million litres9.
With the lifting of economic sanctions the World Bank estimates Myanmar’s economic growth at
1
Reuters, “Myanmar Beer undergoes facelift as it takes on new rivals”, Accessed on 9/3/2016
2
The World Bank, http://data.worldbank.org/indicator/NY.GDP.PCAP.CD, Accessed on 9/3/2016, Note: The per capita
numbers are presented in current US dollars
3
The Heineken Company, “APB in Indochina/Thailand, A regional success story led by Vietnam”, p.6, Note: Cambodia’s per
capita figure is as of 2010
4
Euromonitor International, “Markets Of The Future in Sri Lanka”, Accessed on 9/3/2016
5 The World Bank
6
CNBC, “Myanmar stock exchange begins trade, FMI closes limit up”, Accessed on 9/3/2016
7
Reuters, “Myanmar Beer undergoes facelift as it takes on new rivals”, Accessed on 9/3/2016
8 Some of MBL’s brands sell as low as 50 US cents a bottle, “Myanmar Beer War getting stronger than ever”, Accessed on
9/3/2016
9
Reuters, “Myanmar Beer undergoes facelift as it takes on new rivals”, Accessed on 9/3/2016, Note: The beer market size is
calculated by multiplying the per capita consumption of 3.2 litres as of 2013 by Myanmar’s population of 51 million

2. 2
The opinions presented above reflect the personal views of the author as such should not constitute as investment advice. The
summary is purely intended to be illustrative of the author’s prior experience in investment note writing.
average 8% over 2014-1810. Euromonitor International estimates Myanmar’s beer market to grow
double its forecast GDP rate at a CAGR of 16%11 over the same period much like the beer boom in
Sri Lanka.
The convergence of growth, profitability and risk profiles of consumer companies in the West and their
compatriots in the East has largely concluded. It is increasingly becoming difficult to find a market in
the East that has not been tapped in to by a battered consumer company in the West. Myanmar is
one exception. The author believes Kirin Holding Company presents an excellent proxy to venture in
to untapped Myanmar. Beware, time is ticking.
10
The World Bank, “Myanmar”, Accessed on 9/3/2016
11
Reuters, “Myanmar Beer undergoes facelift as it takes on new rivals”, Accessed on 9/3/2016