Teetotaller-Turned-Liquor Baron Lalit Khaitan Is India’s Newest Billionaire

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India is one of the world’s fastest-growing markets for liquor and cashing in on that trend of rising consumption is Lalit Khaitan, the country’s newest billionaire. The 80-year-old liquor magnate is chairman of the $380 million (revenue) Delhi-based Radico Khaitan, best known for such beverages as 8 PM whisky, Old Admiral brandy, Magic Moments vodka and Rampur single malt, distilled in the foothills of the Himalayas.

Shares of the publicly traded company jumped more than 50% this year on rising sales and with the launch of new drinks such as Happiness in a Bottle gin. This propelled Khaitan into the three-comma club with an estimated net worth of $1 billion based on his 40% stake in the company.

Analysts say that Radico Khaitan’s long-term strategy of expanding its basket of premium brands is paying off. “With more than 15 new brand launches in the past 15 years, the company has successfully built a strong and growing premium product portfolio driven by consumer preferences,” as per a December research report by Mumbai-based Sharekhan, the Indian retail brokerage unit of France’s BNP Paribas.

Indians are quaffing more expensive alcoholic beverages, hence, as the Sharekhan report notes, the premium segment now accounts for a third of total sales volumes, up from 26% in 2018. Today, Radico Khaitan is one of the largest makers of what’s called as Indian Made Foreign Liquor (IMFL) and gets 80 % of its revenue from that segment. (The term refers to all spirits that are not local alcoholic concoctions, such as toddy or arrack.)

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Khaitan’s 80-year-old company started off as a bottler and went on to make bulk alcohol before latching onto branded beverages in 1997 when Khaitan’s marketing-savvy son Abhishek joined the business. The industry is even more frothy today. According to IWSR, a London-based data provider, alcohol volumes in India will grow at a compounded rate of 4% between 2022 and 2027, four times higher than the global average. Buoyed by increasing urbanisation and a rising working population, sales of alcohol beverages in India are projected to touch $64 billion by 2027, up from $52 billion in 2021, according to a November report from the International Spirits and Wines Association of India, a Gurgaon-based trade body.

While Radico Khaitan is well-positioned to benefit, it has to contend with a slew of competitors. The biggest player is United Spirits, a listed subsidiary of Diageo, which was once controlled by flamboyant liquor tycoon and former billionaire Vijay Mallya, who’s now a fugitive in London. Others include Mumbai-based Allied Blenders & Distillers, maker of the popular Officer’s Choice whisky, which is poised for a public listing, and niche producers such as Goa-based Stilldistilling Spirits India, manufacturer of Maka Zai rum and Third Eye Distillery Holdings, which makes Stranger & Sons gin. This week Coca Cola India made a splash by introducing Lemon-Dou, a concoction of distilled liquor comparable to brandy or vodka.

Shares of the publicly traded company jumped more than 50% this year on rising sales and with the launch of new drinks such as Happiness in a Bottle gin. This propelled Khaitan into the three-comma club with an estimated net worth of $1 billion based on his 40% stake in the company.

Analysts say that Radico Khaitan’s long-term strategy of expanding its basket of premium brands is paying off. “With more than 15 new brand launches in the past 15 years, the company has successfully built a strong and growing premium product portfolio driven by consumer preferences,” as per a December research report by Mumbai-based Sharekhan, the Indian retail brokerage unit of France’s BNP Paribas.

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Indians are quaffing more expensive alcoholic beverages, hence, as the Sharekhan report notes, the premium segment now accounts for a third of total sales volumes, up from 26% in 2018. Today, Radico Khaitan is one of the largest makers of what’s called as Indian Made Foreign Liquor (IMFL) and gets 80 % of its revenue from that segment. (The term refers to all spirits that are not local alcoholic concoctions, such as toddy or arrack.)

Khaitan’s 80-year-old company started off as a bottler and went on to make bulk alcohol before latching onto branded beverages in 1997 when Khaitan’s marketing-savvy son Abhishek joined the business. The industry is even more frothy today. According to IWSR, a London-based data provider, alcohol volumes in India will grow at a compounded rate of 4% between 2022 and 2027, four times higher than the global average. Buoyed by increasing urbanisation and a rising working population, sales of alcohol beverages in India are projected to touch $64 billion by 2027, up from $52 billion in 2021, according to a November report from the International Spirits and Wines Association of India, a Gurgaon-based trade body.

While Radico Khaitan is well-positioned to benefit, it has to contend with a slew of competitors. The biggest player is United Spirits, a listed subsidiary of Diageo, which was once controlled by flamboyant liquor tycoon and former billionaire Vijay Mallya, who’s now a fugitive in London. Others include Mumbai-based Allied Blenders & Distillers, maker of the popular Officer’s Choice whisky, which is poised for a public listing, and niche producers such as Goa-based Stilldistilling Spirits India, manufacturer of Maka Zai rum and Third Eye Distillery Holdings, which makes Stranger & Sons gin. This week Coca Cola India made a splash by introducing Lemon-Dou, a concoction of distilled liquor comparable to brandy or vodka.

(the above news was originally posted on the Forbes.com)