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    Indian Liquor Industry

    Uploaded by

    Craig Williams
    The Indian liquor industry is divided into three segments - IMFL, beer, and country liquor. IMFL, which includes whiskey, rum, vodka, and gin, makes up over 65% of the market by value, driven by whiskey which accounts for 60% of IMFL sales. Beer has seen consistent 15% annual growth. Within IMFL, United Spirits has the largest market share at 42%, followed by Pernod Ricard at 10%. The overall liquor market is worth approximately $35 billion annually and is growing at 8% per year. Premiumization and white spirits are among the fastest growing trends in the industry.

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    Indian Liquor Industry

    Uploaded by

    Craig Williams
    163 views5 pages
    The Indian liquor industry is divided into three segments - IMFL, beer, and country liquor. IMFL, which includes whiskey, rum, vodka, and gin, makes up over 65% of the market by value, driven by whiskey which accounts for 60% of IMFL sales. Beer has seen consistent 15% annual growth. Within IMFL, United Spirits has the largest market share at 42%, followed by Pernod Ricard at 10%. The overall liquor market is worth approximately $35 billion annually and is growing at 8% per year. Premiumization and white spirits are among the fastest growing trends in the industry.

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    The Indian liquor industry is divided into three segments - IMFL, beer, and country liquor. IMFL, which includes whiskey, rum, vodka, and gin, makes up over 65% of the market by value, driven by whiskey which accounts for 60% of IMFL sales. Beer has seen consistent 15% annual growth. Within IMFL, United Spirits has the largest market share at 42%, followed by Pernod Ricard at 10%. The overall liquor market is worth approximately $35 billion annually and is growing at 8% per year. Premiumization and white spirits are among the fastest growing trends in the industry.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    163 views5 pages

    Indian Liquor Industry

    Uploaded by

    Craig Williams
    The Indian liquor industry is divided into three segments - IMFL, beer, and country liquor. IMFL, which includes whiskey, rum, vodka, and gin, makes up over 65% of the market by value, driven by whiskey which accounts for 60% of IMFL sales. Beer has seen consistent 15% annual growth. Within IMFL, United Spirits has the largest market share at 42%, followed by Pernod Ricard at 10%. The overall liquor market is worth approximately $35 billion annually and is growing at 8% per year. Premiumization and white spirits are among the fastest growing trends in the industry.

    Copyright:

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    Download as DOCX, PDF, TXT or read online from Scribd
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    of 5

    The Indian Liquor Industry (1st slide)

    Introduction (2nd slide)


    The Indian Liquor Industry is divided into three broad categories: IMFL (Indian Made Foreign Liquor) - This includes whiskey, rum, vodka, brandy and gin. Beer Country Liquor (cheap, spiced liquor) Each of these segments has a volume of between 230-260 million cases per annum. Hence, the market is divided almost equally by volume. However, the IMFL market is much larger in terms of value by the sheer difference in price per bottle. Hence, the IMFL market would be over 65% by value and beer would be nearly 15% by value. (Speak it out)

    Share by Volume (mn cases)


    IMFL Beer Country Spirit

    Share by Value ($ bn)


    IMFL Beer Country Spirit

    230 31%

    260 36%

    $6.62 19% $4.03 11% $24.96 70%

    240 33%

    The overall retail market size of liquor is approximately $35 billion per annum. Overall growth of the market is about 8% per annum, mainly driven by IMFL and beer. Country liquor is a slow growth market. Beer has been consistently growing at over 15% per annum over the last few years.

    Consumer Trends (Slide 3)


    IMFL is dominated by Whiskey Almost 60% of the IMFL market is whiskey. India is the worlds largest whiskey market. 6 of the top 7 selling brands in the world (by volume) are Indian. Beer is dominated by Strong Beer India has a distinct preference for strong beer (8% alcohol v/v). Over 80% of the market is strong beer. Premiumization On the back of growing income, there is a strong trend of premiumization. All liquor companies are increasingly looking at introducing better quality, more expensive brands in their portfolio. High Growth White Spirits This is the fastest growing segment in India. Vodka has emerged as the preferred liquor for the youth. Growth has been at over 25% per annum over the last few years (albeit on a smaller base of ~9 million cases). Unexciting Wine Wine has been a slow growth market in India, with a very niche audience. Although it is highly visible in the cities, the total market is just over 1 million cases. Sula, Four Seasons (UB Group) and Nine Hills (Pernod Ricard) are the leading brands. Maharashtra and Karnataka are the two states with most of the wineries as well as wine consumption. This is due to a preferential tax structure in these states.

    The IMFL Segment (Slide 4)


    Indian Made Foreign Liquor, often abbreviated IMFL, is a term used to denote western-style hard liquors such as whisky, rum, vodka, etc., which are manufactured in India. It is used to differentiate them from indigenous recipes such as fenny, toddy, and arrack, which are collectively called country liquor.

    IMFL Industry Break-up


    Whiskey Rum Brandy White Spirits

    5%

    16%
    20% 59%

    A common characteristic of many IMFLs, distinct from spirits elsewhere in the world, is that irrespective of the final product the starting ingredient is a neutral spirit distilled from molasses, a byproduct of the sugar industry. For example, whereas a whisky in most countries would be distilled from grain, Indian whisky is made by adding whisky-like flavoring and coloring to neutral spirit obtained from molasses. The same applies to other IMFL spirits, like rum or vodka.

    Top Competitors and Market Share


    According to Euromonitor, United Spirits has a 42% volume share in India, the third largest spirits market by volume, followed by Pernod Ricard with 10% share. Allied Blenders & Distillers and Jagatjit Industries have volume share of 6% each, while Radico Khaitan holds a 5% share. (Speak out)

    United Spirits Pernod Ricard Allied Blenders & Distillers Jagatjit Industries Radico Khaitan Others

    42% 10% 6% 6% 5% 31% -Source: Euromonitor

    Market Share of IMFL Companies (2013)

    31% 42%

    United Spirits Pernod Ricard Allied Blenders & Distillers Jagatjit Industries

    5%

    Radico Khaitan

    6%
    6% 10%

    Others

    Key Financials (2012-13) United Spirits Revenue EBITDA Operating Profit Margin (%) PAT Net Profit Margin (%) Volume (mn cases)
    8585.10 1108.82 12.91

    Pernod Ricard
    7216.40

    Allied Blenders & Distillers


    2540.40

    Jagatjit Industries
    993.40 27.70 2.78

    Radico Khaitan
    1258.39 184.23 14.68

    320.80 3.68

    685.10

    5.05 0.50 20.05

    77.28 5.99

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