May 19, 2025
Demand for spirits declined to 1.6% in FY25, down from 4.2% a year ago, with higher taxes, distribution changes, and reduced discretionary spending hitting sales.
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Sales growth of 0.5% in January-March fell short of expectations.
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Whiskey, accounting for two-thirds of the market, rose 1.5% in volume, while brandy sales grew less than 1% and vodka sales remained flat. Gin sales saw a 3.6% increase on a lower base.
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Gen Z consumers prefer quality over quantity, says Allied Blenders & Distillers. India, despite being the most populous country with over 1.4 billion people, has an estimated drinking consumer base of around 300 million, nearly half of whom depend on inexpensive, unbranded liquor.
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Sales in Telangana were impacted by temporary disruptions, while the Delhi excise policy reversal led to lower distribution by national brands. Third-quarter sales were also affected by customs clearance delays for imported spirits and a resolved production halt in a key state.
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There were some positive policy changes as well, with Karnataka cutting state duties by 10-15% on alcoholic beverages and Andhra Pradesh opening the retail alcohol market to private players.
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Global liquor sales declined by 1% in 2024, as per IWSR, with major markets like China and India failing to meet growth projections. The top 20 markets missed estimates by 1-2%, equating to over 300 million nine-litre cases.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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