India’s alcoholic beverages industry is witnessing a slowdown in mass-market spirits consumption as inflation, weaker consumer sentiment and state-level excise policy changes put pressure on demand for affordable liquor brands. According to excise data cited by industry officials, India’s spirits market recorded volume growth of 4.6% year-on-year in the September quarter of 2026, compared with 6.4% in the corresponding period last year. The slowdown highlights the growing challenges facing liquor companies that depend heavily on popular and economy-priced whisky, rum and other spirits.
The pressure has been particularly visible in the mass-market segment, where consumers are more sensitive to increases in retail prices and household expenses. Prestige and above spirits recorded growth of 5.7% during the September quarter, while regular and other mass-market spirits expanded by just 3.7%. Although overall market growth improved from 3% in the preceding June quarter, demand remains uneven across price categories.
Amar Sinha, Managing Director of Allied Blenders and Distillers (ABD), the manufacturer of Officer’s Choice whisky, said the reasons behind the slowdown were difficult to identify, even in states such as Uttar Pradesh that had previously delivered strong growth. He noted that there were no clear factors explaining the weakness in certain markets.
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Praveen Someshwar, Managing Director of United Spirits, attributed the subdued consumer sentiment partly to persistent inflation, the prolonged West Asia crisis and weaker monsoon conditions. He said lower-income urban consumers were experiencing greater financial pressure, while middle- and higher-income consumers continued to demonstrate stronger resilience.
The trend is also reflected in company performances. United Spirits reported a 22.7% decline in net sales value in its popular portfolio during Q2 FY27, while its Prestige and Above segment grew 6%. Regulatory changes in Maharashtra and Karnataka further affected its mass-market business.
Meanwhile, ABD reported an 11.1% increase in overall volumes to 10 million cases, demonstrating that individual companies continue to experience different market conditions.
Industry research agency ICRA has also highlighted the pressure on economy and regular spirits, forecasting a 4–6% decline in overall spirits volumes in FY27, even as premiumisation supports revenue growth.
The changing consumption pattern presents a challenge for liquor manufacturers: protecting mass-market volumes while strengthening premium portfolios amid rising costs and evolving consumer preferences.
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