Copenhagen, Oct 2 - Russia's proposed beer tax increase could reduce sales in the world's third biggest beer market, hurting brewers such as market leader Carlsberg , the Danish company said on Friday.
Carlsberg, which has 41 percent of the Russian beer market, said in a statement a bill had been moved to the Russian parliament in which the government intends to increase the excise duty on beer by 200 percent from 2010, by 11 percent in 2011 and by 20 percent in 2012.
The hike is part of a package of measures to curb alcohol abuse unveiled last month in next year's Russian budget.
Carlsberg Chief Executive Joergen Rasmussen told Reuters the proposal, if it took effect, would cause the Russian beer market to shrink. He declined to give an estimate of by how much.
Industry experts have said the proposal could affect over 25 percent of beer sales in Russia.
"It is not good for the brewers," Rasmussen said in a brief telephone interview. "This would be bad for the total market but we should be able to take market share."
In the statement, Carlsberg Senior Vice President for Eastern Europe, Anton Artemiev, said the proposal would hurt not only the brewing sector but also the broader Russian economy and employment as well as foreign investment in the country.
Shares in Carlsberg, which earns almost half of its profits from Russia, were down 7.3 percent at 335.50 crowns by 1430 GMT, having hit an 11-week low of 333.50 crowns.
The stock has lost 15 percent since the news of the planned beer tax hike while the DJ Stoxx European food and beverages index <.SX3P> is down just over 2 percent in the same period.
Analysts at Denmark's Jyske Bank said in a research note they expected the Russian beer tax to be raised by between 50 percent and 100 percent in 2010. Jyske reiterated its "buy" recommendation and target price of 450 crowns.