VietNamNet Bridge – Masan is just a “rookie” in the beverage market, but it is a name big enough for the experienced warriors to look out for.

Masan has officially jumped into the drink market with considerable assets – the controlling stakes in Vinh Hao, a bottled mineral water manufacturer, and Vinacafe Bien Hoa, a coffee producer.

Tidbit is hardly idle

The powerful group, which has been present in many different business fields, kicked off its attack on the beverage market in 2012 after buying Vinacafe Bien Hoa. The move has helped put Masan into the No. 1 position in the instant coffee market.

After that, Masan decided to pour its capital into Vinh Hao, a part of its plan to acquire the bottled drink market. Masan has 63.5 percent of Vinh Hao stakes now.

With Vinacafe Bien Hoa and Vinh Hao, Masan has been marching towards the beverage market.

In fact, the presence of Masan on the beverage market is foreseeable. The market is so attractive that no one would skip it. A report of Euromonitor showed that the Vietnamese beverage market is valued at VND54 trillion.

Besides, the high compound annual growth rate (CAGR) of 48 percent in 2007-2012 for the bottled tea market segment is really admirable for everyone.

Masan is believed to meet big barriers when joining the market, where the big guys have cemented their positions and have been trying to expand the production scale.

Tan Hiep Phat, which leads the tea bottled market segment, for example, has opened two new factories in Quang Nam and Ha Nam provinces.

In late 2012, Nestle poured another $12 million into the new production line in Long An province to give more strength to La Vie bottled mineral water, thus raising its investment capital in the field by two folds.

The beverage market has become so profitable that it has attracted the investors who have no relations with the industry.

Ngo Han, a copper wire manufacturer in Dong Nai province has unexpectedly bought Cuc Phuong, a mineral water manufacturer in Ninh Binh province. Nam Bay Bay, a real estate firm, has injected money in a mineral exploitation firm in Quang Ngai province which has the capacity of 32 million liters per annum.

Masan has set up an ambitious development plan for its new business field – the turnover of VND3-5 trillion in the next few years. Meanwhile, Vinh Hao’s turnover in 2012 was modest at VND500 billion.

Market will be re-mapped?

Analysts believe that Vinh Hao and Vinacafe Bien Hoa would not be enough to help Masan make a breakthrough in the beverage market, the thing it could do in the food market some years ago.

A senior executive of an investment fund in HCM City commented that the creativeness will determine the success in the market.

He said Masan would not succeed if it just makes the products similar to the ones available on the market.

It’s still too early to say if Masan is powerful enough to re-map the beverage market. However, it has shown a strong determination to develop the business. Masan Group has set up Masan Beverage which gathers the best known experts in the beverage industry. Masan Beverage is headed by Le Trung Thanh, who was Deputy General Director of PepsiCo Vietnam.

TBKTVN