Lucknow/Mumbai: India’s alcoholic spirits market bounced back in the April–June quarter, with sales volumes growing by 6%, compared to just 1% growth a year ago, according to data from state excise departments.
The revival comes after several slow quarters, which were hit by policy changes, high base effects, and consumers cutting down on discretionary spending.
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Whisky, the largest segment making up nearly two-thirds of the market, grew 7% — its best performance in two years.
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Vodka sales jumped 14%, rum rose 9%, and gin surged 48% from a smaller base.
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However, brandy, the second-largest category, slipped 25%.
Industry leaders see early signs of recovery, especially in rural areas. “Healthy monsoons will further boost demand, and we’re already seeing improvements across FMCG categories,” said Praveen Someshwar, MD of Diageo India, during an earnings call.
Market Share Snapshot
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Whisky: 67%
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Rum: 21%
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Vodka: 10%
The rebound is notable after a weak March quarter when volumes rose only 0.5%. For FY25 overall, spirit volumes in India grew just 1.6%, much lower than 4.2% in FY24.
Focus Shifting to Premiumisation
With more consumers willing to pay for better brands, companies are moving away from chasing just volumes and focusing on value growth.
“It’s time the industry measures success by revenue, not just tonnage. Consumers are trading up across categories, not only whisky but also rum and brandy,” said Alok Gupta, MD of Allied Blenders & Distillers.
India has over 300 million drinkers, but nearly half still consume low-cost or unbranded liquor. The mass-premium segment, once a key driver, is under pressure from rising costs and local competition.
“The lower end of the market has always faced margin pressures. Our focus is on premium, semi-luxury, and luxury products, which continue to show strong growth,” said Abhishek Khaitan, MD of Radico Khaitan.
Challenges Ahead
State excise policy changes and temporary disruptions in distribution affected growth earlier. However, with consumer preferences shifting toward premiumisation and rural demand expected to strengthen, industry players believe the sector is entering a healthier growth phase.
