Premium liquor demand holds up in Sept qtr

Bengaluru: Indians continued to spend on pricier beer and spirits in the September quarter, helping liquor makers post stronger sales and profits even as costs remained high.Radico Khaitan reported total income of Rs 5,588 crore for the quarter, up 10% from a year earlier, while net profit rose 66% to Rs 232 crore. The maker of Magic Moments vodka and Rampur whisky saw volumes of its Prestige & Above, or higher-priced, liquor rise 35.8%, while volumes of its regular products fell 9.7%.Premium products now account for 77.1% of Radico’s Indian-made foreign liquor revenue, up from 68.6% a year earlier. Managing director Abhishek Khaitan told **TOI** that the company was increasingly focusing on premium liquor and would sell regular products selectively in states where they remained profitable.Vodka has been a major driver. Khaitan said vodka now accounts for 6.3% of liquor sold in India, compared with 3.7% about two years ago, while Radico controls around 60% of the vodka market. He expects the shift to continue for several years.United Breweries, the maker of Kingfisher beer, reported total income of Rs 4,664 crore, up 24% from Rs 3,752 crore a year earlier. Profit for the quarter nearly tripled to Rs 135 crore from Rs 46 crore.Overall beer volumes rose 16%, but premium beer volumes jumped 38%. Heineken Silver volumes grew 67%, while Kingfisher Ultra volumes rose 44%. United Breweries said higher volumes, price increases and consumers trading up to premium beer helped sales, while cost savings also boosted profitability.Allied Blenders and Distillers (ABD), which makes Officer’s Choice and ICONiQ White, reported total income of Rs 2,089 crore, up 7%, while profit rose 10% to Rs 69 crore.ABD showed a somewhat different trend. Volumes of its Prestige & Above products rose 6.1% to 4.5 million cases, while its lower-priced Mass Premium & Others portfolio grew faster, rising 15.5% to 5.5 million cases. However, revenue from the premium portfolio still rose 13.4%, as the company earned more on every case sold.ABD’s overall quarterly volumes crossed 10 million cases for the first time. Its operating profit margin slipped to 12.4% from 13.1% as spending on brands and its new luxury portfolio, along with a Rs 29-crore hit from global supply-chain disruptions, eroded some of the gains.Karnataka also emerged as a common bright spot. Khaitan said Radico’s premium portfolio in the state grew 120% after liquor duties were rationalised, making higher-priced brands relatively more affordable. United Breweries separately said Karnataka led its market-share gains during the quarter.Khaitan said the broader shift towards premium alcohol had accelerated after the pandemic, as consumers became more willing to spend on experiences and themselves.You use AI every day. Now get your AI Quotient. Take the AIQ test.