The Carson’s group with an investment of nearly Rs.1.1 billion in the Indian beer industry sees substantial growth potential in the Indian market.

Lion Brewery, a Carson’s group company, currently holds 22.5% of a joint venture (JV) in India with Carlsberg International of Denmark.

This JV is already present in Rajasthan, Himachal Pradesh, Maharashtra and Kolkata with a capacity of approximately 1 million hl. already exceeding Lion’s Sri Lanka capacity. A fifth venture is planned for H.yderabad.

Carson’s said that the Indian JV is not yet profitable due to the gestation period involved in achieving market penetration.

"As such, despite the challenges of financing constraints and the long wait for cash profits to accrue, we have embarked on this project with the promise of superior returns in the long term," Carson’s annual report said.

The brewery company is raising equity in Sri Lanka with a rights issue by Lion priced at Rs.40 per share to raise Rs.1.2 billion to strengthen its capital structure and prepare for short-term opportunities particularly in the hitherto closed markets in the North and East of the country.