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STUDY: INDIA HAS ABOUT 160M ALCOHOL CONSUMERS, ONLY 7.5% ARE WOMEN

By Susan Lewis

13-1-2022



Credit: Claudette Bleijenberg/Unsplash

The total number of alcohol consumers in India is estimated at around 160 million, of which only 7.5 percent are women, according to a study by Swiss investment bank UBS.

In its International Wine and Spirits Records released recently, UBS said the uptake of alcohol consumption by women has increased during the pandemic.

As a whole, however, India’s total alcohol consumption declined 29 per cent on year in 2020. The decline in spirits was relatively lower at 19.7 percent, while beer volumes fell 39.1 percent year-on-year.

Per capita consumption of alcohol is lower in India at 5.5 litres compared with Asia at 6.4 litres and global at 6.2 litres.

“We believe it is likely to improve, as structural drivers of demand (such as favourable demographics) remain, despite recent disruption.

We expect progressive improvement in the regulatory environment: 1) lowering of excise duties (Delhi, West Bengal and Maharashtra); and 2) improving distribution (Delhi and Uttar Pradesh), to aid growth,” said UBS's analyst Sunita Sachdev.

The report said United Spirits is the market leader in the Indian liquor market with a volume share of around 23 percent. Global spirits producer Diageo has management control of United Spirits with a 55.9 percent stake.

United Spirits has the largest distribution network among Indian spirits companies. The company has 11 brands (brands with sales of more than 1 million cases per year) and 45 manufacturing facilities in India.

In the beer space, the report said United Breweries dominates the Indian market with 52 percent market share. Dutch brand Heineken holds 61.5 percent of United Breweries. The company’s flagship brand Kingfisher is the most popular Indian beer brand globally.

As state governments do not allow the inter-state movement of alcoholic beverages, United Breweries owns 20 breweries and operates 11 contract manufacturing facilities across the country.

“Beer was one of the worst affected categories during the pandemic due to restrictions in on-premise consumption and consumers avoiding cold beverages. After the initial disruption, there has been a quarter-on-quarter recovery in beer demand,” noted UBS.

UBS expects a sustained period of growth over the next four to five years for the Indian alcoholic beverages sector, as the regulatory outlook improves across states.

After the initial increase in additional taxes during the pandemic, UBS thinks most states have realised that excessive taxation can have a negative impact on overall revenue collection and have corrected this.

According to data collected by Ambrosia, a monthly publication for the alcohol industry, Andhra Pradesh, Telangana, Kerala, Karnataka, Sikkim, Haryana and Himachal Pradesh are amongst the largest consumers of alcohol in India.

(the writer can be contacted at: info@thewinechronicle.com)

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