India’s liquor sales rebounded in the year ended March, helped by stronger demand for premium spirits with beer makers overcoming one of the wettest summers in recent years amid rising costs.
Sale of spirits by volume across whisky, rum and vodka grew 4% in FY26 to 440 million cases, compared with 1.6% growth a year earlier, according to executives citing excise data. Beer volumes also rose 4% to 474 million cases, despite heavy rains disrupting sales during the crucial summer season. The recovery indicates improving discretionary spending.
This was especially true of urban markets, where drinkers shifted to superior brands.
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“From a financial performance perspective, the year has been encouraging,” Radico Khaitan managing director Abhishek Khaitan said on an earnings call. “A better portfolio mix, relatively benign input costs and the benefit of scale have helped us improve margins and returns.”
India’s spirits growth continued to be led by premium products as mass-market demand remained weak because of inflation and higher taxes in several states. Whisky, which accounts for more than 63% of the country’s spirits market, grew 6% in the premium segment while volumes in the regular category fell 4%, according to the data. Premium rum and vodka volumes rose, by 20% and 33% respectively, while the regular segment expanded 6%.
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Companies such as Pernod Ricard, Diageo and Radico Khaitan have stepped up launches of premium brands to target younger consumers and urban drinkers. Such products now account for nearly half the market by value, industry executives said.
Pernod Ricard chief financial officer Hélène de Tissot said on a recent earnings call that India continued to benefit from “dynamic consumer fundamentals,” driven by strong demand and continued premiumisation.
Diageo said India grew in the high single digits, excluding Maharashtra, which saw a tax hike.
Beer makers had a tougher year after excessive rainfall hurt sales during the summer months, especially in May, the peak beer consumption month in India.
“The recovery later in the year was aided by a series of state-level policy changes that improved beer affordability and retail access,” said Vinod Giri of the Brewers Association of India, which represents United Breweries, AB InBev and Carlsberg.
Maharashtra, India’s largest beer market, grew about 18% after the state raised taxes on spirits but kept beer duties unchanged. Sales in Andhra Pradesh rose 60%, the Assam market increased 73% after tax cuts, and Uttar Pradesh grew 13% after easing retail licensing rules.
However, some major markets remained weak. For instance, Karnataka volumes fell 13%, Telangana declined 10%, while Odisha dropped 24% and West Bengal fell 14%.
Giri warned that rising fuel and supply-chain costs linked to tensions in West Asia could hurt profitability in FY27, particularly in states where companies have little room to increase prices.
“We think that the Indian consumer and beer market will be resilient,” United Breweries managing director Vivek Gupta told investors, adding that companies were closely tracking fuel prices and inflation because of their impact on discretionary spending.
Sale of spirits by volume across whisky, rum and vodka grew 4% in FY26 to 440 million cases, compared with 1.6% growth a year earlier, according to executives citing excise data. Beer volumes also rose 4% to 474 million cases, despite heavy rains disrupting sales during the crucial summer season. The recovery indicates improving discretionary spending.
This was especially true of urban markets, where drinkers shifted to superior brands.
Read more: As PM Modi appeals, govt & India Inc set to operate on a war footing
“From a financial performance perspective, the year has been encouraging,” Radico Khaitan managing director Abhishek Khaitan said on an earnings call. “A better portfolio mix, relatively benign input costs and the benefit of scale have helped us improve margins and returns.”
India’s spirits growth continued to be led by premium products as mass-market demand remained weak because of inflation and higher taxes in several states. Whisky, which accounts for more than 63% of the country’s spirits market, grew 6% in the premium segment while volumes in the regular category fell 4%, according to the data. Premium rum and vodka volumes rose, by 20% and 33% respectively, while the regular segment expanded 6%.
Read more: REC arm makes move for carbon market play
Companies such as Pernod Ricard, Diageo and Radico Khaitan have stepped up launches of premium brands to target younger consumers and urban drinkers. Such products now account for nearly half the market by value, industry executives said.
Pernod Ricard chief financial officer Hélène de Tissot said on a recent earnings call that India continued to benefit from “dynamic consumer fundamentals,” driven by strong demand and continued premiumisation.
Diageo said India grew in the high single digits, excluding Maharashtra, which saw a tax hike.
Beer makers had a tougher year after excessive rainfall hurt sales during the summer months, especially in May, the peak beer consumption month in India.
“The recovery later in the year was aided by a series of state-level policy changes that improved beer affordability and retail access,” said Vinod Giri of the Brewers Association of India, which represents United Breweries, AB InBev and Carlsberg.
Maharashtra, India’s largest beer market, grew about 18% after the state raised taxes on spirits but kept beer duties unchanged. Sales in Andhra Pradesh rose 60%, the Assam market increased 73% after tax cuts, and Uttar Pradesh grew 13% after easing retail licensing rules.
However, some major markets remained weak. For instance, Karnataka volumes fell 13%, Telangana declined 10%, while Odisha dropped 24% and West Bengal fell 14%.
Giri warned that rising fuel and supply-chain costs linked to tensions in West Asia could hurt profitability in FY27, particularly in states where companies have little room to increase prices.
“We think that the Indian consumer and beer market will be resilient,” United Breweries managing director Vivek Gupta told investors, adding that companies were closely tracking fuel prices and inflation because of their impact on discretionary spending.
