India Alcoholic Beverages Market Outlook, 2027-28

India is the world’s 9th largest consumer of alcohol. It is the second largest consumer of spirits like whiskey, vodka, gin, rum, tequila, and liqueurs, behind China. The Indian whiskey market flourished despite many roadblocks. The importance of the Indian whisky market to the global well-being of the whisky category cannot be overstated: nearly one in every two bottles of whisky bought around the world is now sold in India, and seven of the top ten global whisky brands are Indian. Demand is being fuelled by a rising consumer base of young consumers who are becoming more affluent in a country where the global reach of some of the smaller cities is becoming more significant, diluting the historical whisky sales bias towards the big three cities of Mumbai, Delhi, Gurgaon and Bangalore. Consumers are moving towards the premiummization of whiskey brands. This has prompted the emergence of some pioneering and cult Indian whisky companies like John Distillers and Amrut Distillers, who are raising the bar for Indian whisky. Attempts are also being made to create a buzz around the use of whisky in cocktails, which will make the category more relevant not just to younger drinkers, but also to the female market. There is already evidence that in the higher echelons of Indian society, women are developing a taste for top-end whiskies.

According to the research report, India Alcoholic Beverages Market Outlook, 2027-28 states that the consumption of alcoholic beverages is to reach 11.45 billion litres by 2027-28, which would generate revenue worth INR 58,618 crores. India consumed 8.82 billion litres of alcoholic beverages in 2021-22. India consumes more whiskey than any other country in the world, about 3 times more than the US, which is the next biggest consumer. Nearly one in every two bottles of whiskey brought around the world is now sold in India. Whiskey constituted 48% of the market share in India in 2021-22, followed by brandy and wine. Almost 60% of the urban population drinks alcoholic beverages on a daily, weekly or monthly basis. The population residing in the metro cities of India consumes most alcoholic beverages influenced by western culture. Consumption of alcohol in the southern states of India is higher than in other regions of the country. On the other hand, eastern states have the lowest consumption of alcohol. Alcohol consumption by women is highest in the eastern part of India and lowest in northern India. On the other hand, alcohol consumption by men is highest in East India and lowest in West India.

According to the NFHS (National Family Health Survey-5) Survey 2021, nearly 150 million adults (15 years and above) in India drink alcohol (10% of all adults). As per the findings, alcohol consumption amongst adult women (15 years and above) is at 1.3%, and for adult men (15 years and above) it is at 18.8%.

The price of the bottle of alcohol, rum, or vodka keeps rising due to the state governments and the plethora of taxes they impose, considering it a sinful product. The most common taxes are excise duties and levies such as sales tax, gallonage fees, and licence fees. On top of that, some states even charge VAT on the level of production and distribution. The highest excise duty was earned by Tamil Nadu in 2015-2016 and in 2019-2020 by Uttar Pradesh. The state government gets as much as INR 85 via taxes out of every INR 100 spent by a buyer on liquor. The sale of alcohol has always been a strong source of inflow for states, one of the reasons why the Centre never brought it under the purview of GST. but levies VAT on raw materials used to produce alcohol that is as high as 18% and to fill their coffers after their revenues were battered by several months of the COVID-19 lockdown. They levy GST on transportation and freight charges for liquor. In the Budget 2021, the Finance Minister proposed an agriculture infrastructure cess of 100% on all alcoholic beverages. However, according to experts, this new tax will not increase alcohol prices. That’s because 100% of agri infrastructure cess is cancelled by a 100% reduction in customs duty.

The 29 states and Union Territories of India approach liquor taxation policy differently. For instance, Gujarat and Bihar have banned their citizens from consuming liquor, meaning the state’s revenue from liquor consumption is nil, but outsiders with special licences can still buy it. On the other hand, Puducherry earns most of its revenue from alcohol trading. Uttar Pradesh earns the most excise duty on liquor. While Punjab decided to keep its excise duty unchanged in the current fiscal, it has increased its sales quota and expects to collect a revenue of INR 7,000 crores in the next fiscal. A Crisil report showed that in May 2020, Andhra Pradesh, Telangana, Kerala, Karnataka, and Tamil Nadu states earn some 15% of their revenue from excise duty, a Crisil report showed. Andhra Pradesh announced prohibition in 2019, but it sells alcoholic beverages with a prohibition tax. For Kerala, the tax on liquor is its single largest revenue source, with the highest 250% tax. Nationally, Maharashtra charges the highest rate but draws only a portion of its revenue from its sales. Tamil Nadu, like Kerala, earns a large part of its revenue from the sale of liquor. It has imposed VAT, excise duty, and a special fee on foreign liquor. Delhi is planning a move to increase the excise duty to increase liquor prices by as much as 50%. To promote tourism, Goa has the lowest liquor tax rate in the country.

Although perceived to be a recession-free industry, Covid-19 proved that the alcoholic industry too could be brought to its knees. When the country announced lockdowns, long queues were seen outside liquor shops across the country. In cities like Mumbai, a COVID-19 hotspot, booze-loving people made a mockery of social distancing rules, prompting the government to shut the shops again. During peak lockdown months, while the central government permitted the opening of shops to sell essentials, it denied the sale of alcoholic beverages, which led some states to allow online delivery of alcohol. Lack of liquor taxes has left near-bankrupt states groaning under lockdown with little money to spend. However, demographics in India and various factors prove that the industry could bounce back provided that legislative interference is kept to a minimum.

Companies present in the market: Diego India (United Spirits Limited), Pernod Ricard India Private Limited, Allied Blenders And Distillers Private Limited, Radico Khaitan Limited, Bacardi Limited, Jagatjit Industries Limited, John Distilleries Private Limited, Tilaknagar Industries Limited, Globus Spirits Limited, Mohan Meakin Limited, Som Distilleries & Breweries Ltd. Despite slowdown in the overall spirits segment, companies, especially selling either imported or the pricier bottled in India (BII) spirits, said their business has remained insulated in the country where 19 million people are becoming eligible for drinking every year.

Considered in the Report:

• Geography: India
• Base Year: 2021-22
• Estimated Year: 2022-23
• Forecast Year: 2027-28

India by Region

• South India
• West India
• North India
• East India

By Segments covered in the report

• Whisky
• Brandy & Wine
• Beer
• Rum
• Vodka
• Gin
• Other Liquors

By Distribution Channel

• Retail
• Institutional
• CSD (Canteen Store Department)

By Demographic

• Rural
• Urban

The Approach of the Report:

The publisher performed primary as well as secondary research for this study. Initially, a list of manufacturers and suppliers operating in the Sun Care Market of India were sourced through secondary sources. With the identified companies and consumers, primary research was carried out which included conducting online surveys, competitor analysis and exhaustive personal interviews - both face to face as well as telephonic basis, to extract maximum information from participants like industry executives/ distributors or consumers. Primary research gave us an idea of company revenues, export, pricing, geographical presence, channel partner model, USP etc. and also helped us to identify various small players who otherwise have less presence on the web.

The publisher seeks secondary data from third-party sources such as published articles, company websites, magazine articles, associations, trade journals, annual reports, government official websites and other paid database sources. In addition, data is also mined from a host of reports in our repository, as well as a number of paid databases of Indian government. Using both primary and secondary information, the publisher calculated the market size through a bottom-up approach, where manufacturers’ value sales data for different types of sun care products were recorded and subsequently forecasted for the future years.

Intended Audience:

This report can be useful to Industry consultants, manufacturers, suppliers, associations & organizations related to alcohol beverages industry, government bodies and other stakeholders to align their market-centric strategies. In addition to marketing & presentations, it will also increase competitive knowledge about the industry.