United Breweries Limited Presentation November 2007

India and the Beer Industry

Indian Economy The current year growth rate is 9% The growth is largely propelled by local consumption hence lesser prone to global changes. Inflation currently at ( )% (CPI) giving impetus to growth – Source RBI Oct 13, 2007 Substantial increase in the disposable income in the age group of 20 to 30 years

Increase in disposal Income Source: Motilal Oswal Securities

Indian Demographics – favorable to growth in beer consumption Current population 1.1 billion Over 50% of the population is below the age of 20 years The demographics to remain almost unchanged till the year 2020 Core target market is year olds As initiation to alcohol consumption is through low alcohol beverages like beer – excellent opportunity for growth in beer consumption over the next decade and half.

Population demographics Figures million

Beer Industry in India Policies & Regulations are driven by State Government Highly regulated with restriction in movement between states 65% of the Indian market is state controlled – Distribution by Govt. Corporations, implications upon pricing Advertising strictly prohibited, advantage for existing players, major barrier to entry

Beer Industry in India contd. Government corporations are now approachable and not averse to make changes There have been recent recommendations by some governing bodies to de link beer from spirit and have a common national duty structure much lower than the current duty levels

Beer Industry in India contd AFFORDABILITY Duty not set according to alcohol content Highest duty in the world Expensive alcoholic beverage AVAILABILITY 55,000 licensed outlets across the country 1 per 20,000 people In UK 1 per 350 people Beer is not the alcoholic beverage of the common man

Alcohol Consumption India Emerging Markets 21.5%87%Beer Spirits/ Liquor Wine 5% 8% <0.5% 78%

Per Capita Beer Consumption

Key performance highlights H % volume growth in UBL while the combined business grew at 14.3% as against an industry growth of 12.6% Kingfisher growth - premium 5.4%, strong 23.9% EBITDA at the half year end 112 Cr. as against 87 Cr., a growth of 29% Combined EBITDA at the half year end 143 Cr. as against Cr.110, a growth of 30%

Operational performance

Volume Growth – H % %+ 13.8% % Industry Combined Business UBL Only MABL Only

Change in Consumption pattern Currently all international brands known in India are mild beers & most of the new launches have been in this category, which has been declining

Kingfisher Performance

UBL V’s SABM Market Share 33% 47% UBL SABM March 07

Financial Performance

Margin on sales in the published financials not comparable as Sept. 06 does not include KBDL a 100% subsidiary

Performance analysis An increase in the operating margins despite cost push Despite a 29% growth in operating margins PBT growth of only 4% on account of interest & depreciation – Rights issue approved by the Board expected in the first half of the next financial year Healthy growth in operating margins of 31% in the combined business

Summary Balance Sheet

Ratios