About 1.2 billion cases of baijiu, a heritage white spirit from China made with sorghum at an ABV (alcohol by volume) of about 40%, are sold each year globally making it the world’s top selling spirit followed by whisky. While the global baijiu market was valued at about US$ 110 billion, the global whiskey market at US$ 56.7 billion in 2018.
About 170 microbreweries mushroomed in the past decade as the country’s high population of millennials showed keen interest in craft beer, a niche segment that still accounts for just 2-3% of the beverage consumption. Packaged craft beer brands such as White Owl and Geist are feeling the impact of the economic slowdown as well.
In October, the Mumbai-based brewer had raised Rs 40 crore in its second round of funding led by existing investors IIFL India Private Equity Fund to expand geographic footprint to cash in on the rising popularity of craft beer. Javed Murad, founder of White Owl, had told ET that the funds will be used to widen its product portfolio and newer formats.
The new craft style beer by the Bengaluru-headquartered brewer is a locally made Belgian wheat beer with orange and coriander flavours and hops from USA. At an ABV of lower than 5%, the variant will be retailed in both can and bottle formats. A 330 ml bottle will be priced at Rs 110.
The maker of Bira craft beer, saw the slowest growth ever due to production delays while losses doubled after an expensive nationwide marketing deal, in a crowded market dominated by mainstream brands.
The maker of Johnie Walker and McDowell whiskey said in a company statement that the amalgamation scheme has been approved at its board meeting. The scheme now awaits requisite approvals from statutory authorities including Securities Exchange, BSE Limited and NSE, respective shareholders and creditors of both the companies.
The alcohol manufacturers have pleaded that there is a massive shortage in domestic supplies of ENA following diversion of ethyl alcohol for bio-fuel blending by oil marketing companies (OMCs) in the country.
The beer company announced the appointment of Kartikeya Sharma as President-South Asia. Sharma has succeeded Ben Verhaert who will now be President-East Asia. According to the company statement, both Sharma and Verhaert will report to Jan Craps, CEO Budweiser APAC and President – APAC at AB InBev, with effect from January 1, 2020.
“It’s a volatile environment. We used to say, two steps forward and one step back. The third quarter indeed was one of these quarters that is one step back for Carlsberg when it posted flat volume growth. It was impacted by price and excise tax increase in a couple of states," Hart said at an investor call last week.
Enlisting the reasons why 46% of respondents wanted a uniform drinking age of 21 years, a study by Kantar and NFX said it would enable them to be aware of their limits of responsible alcohol consumption. It indicated that a growing number of Indian consumers are willing to indulge in responsible drinking provided certain barriers are addressed.
Liquor trade’s hangover from the slowdown is similar to FMCG failing to take a bigger bite out of consumer spend, again thanks to liquidity issues. Hindustan Unilever had last month said trade was facing an acute liquidity crunch. Analysts expect liquor sales to remain subdued for the rest of the fiscal.
The maker of Absolut vodka and Chivas Regal scotch had gross sales of Rs 20,335 crore in the year-to-March 2019, latest filing sourced from Veratech showed. Pernod's growth numbers outpaced Diageo's Indian business that grew 10% in revenues.
A host of factors have taken a toll on liquor sales recorded till September. Last year's high base along with floods and an economic slump has seen consumption taking a hit. General elections also impacted the sales in April & June.
The sale of spirits has been hit by a host of factors like high taxation, restrictive pricing, sporadic prohibitions, among others. India is one of the most profitable regions for Pernod globally and ranks next to the US and China.