Mr. Gajrawala: Obviously, U.S. Beverages, also the global coordinator for all beverage names around the world. And primary coverage would be the U.S. beverage names, which would be Coca-Cola, PepsiCo, Coke's bottler, which is CCE. On the alcoholic side, it would be Constellation Brands (STZ), Molson Coors (TAP) and Brown-Forman. Other names we cover include smaller companies like Hansen Natural, Dr. Pepper Snapple (DPS) and Cott Corp (COT).
TWST: What promotions have the spirits companies employed as a result of the recession? And which companies' efforts have been successful?
Mr. Gajrawala: I think what we're seeing is spirits companies get impacted by the economy a bit later than most other industries. And right now they are going through their holiday period, which would be two weeks prior to Thanksgiving through New Year's. Last year they were impacted but very marginally. But this year, now that we're a year into this economy being weak, they are seeing a lot more pressure. They are responding to the pressure by increasing the promotions. And there are significantly higher promotions than we've seen in the last five to seven years. What's concerning the most is because you have such a limited window of opportunity in terms of making your year because of how critical the holidays are, everybody is scrambling to get as much of an attractive price as they can. So our concern on Brown-Forman, the reason why we have promotional activity accelerating is they earn the bulk of their profits from Jack Daniel's. They don't necessarily have the flexibility to portfolio manage like some other companies can.
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