India's alcohol market is growing, but the spending story is not the same at every price point. Premium beer and spirits are finding demand, while some consumers at the other end of the market are beginning to feel the pressure on their wallets.
That does not mean drinkers are abandoning cheaper brands or switching to more affordable options. But the management commentaries point to a market where growth and consumer sentiment are not moving in exactly the same direction. Premium products are gaining volumes, yet there are signs that inflation is weighing on the spending capacity of some urban consumers.
-
Indian Markets Turning Corner After Two Tough Years, Says Sandeep Tandon -
NDTV Profit Ignite 2026: Experts See Opportunity In Equities, Stay Bullish For Long-Term -
Buy Right, Sit Tight Does Not Work for Individual Stocks, Says Dinshaw Irani -
'Worst Is Behind': Quant MF Sees Market Bottom, Flags 'Extreme Euphoria' In Midcaps -
India's Mutual Fund Industry Could Become A $1 Trillion Opportunity, Say Fund Managers -
'Foreign Investors Are Baraatis': Raamdeo Agrawal's Take On LTCG Tax -
Stay Invested Through Market Cycles: Raamdeo Agrawal at NDTV Profit Ignite -
Ramesh Damani Remains Bullish On India For Next 20-30 Years, Sees Bargains Amid Market Weakness -
CAS Came After A Long Consultation Process: SEBI Chairman Tuhin Kanta Pandey AT NDTV PROFIT IGNITE -
Aim To Cut FPI Onboarding Time From Mth To Five Days: SEBI Chairman Tuhin Kanta Pandey AT NDTV PROFI
The numbers show why the distinction matters. Premium beer volumes rose 38% year on year in the September quarter at United Breweries, while Radico Khaitan reported 36% growth in its Prestige and Above portfolio. At the same time, Allied Blenders and Distillers reported 15.5% volume growth in its Mass Premium and Others segment, ahead of the 6.1% increase in Prestige and Above.
The clearest indication of pressure came from United Spirits. The company said consumers at the lower end of its urban market were showing signs of wallet fatigue amid inflation, even as its other consumer segments remained resilient.
ALSO READ | Radico Khaitan To United Spirits In Focus As HDFC Securities Initiates Coverage — Full List Inside
One Market, Different Budgets
United Spirits CEO Praveen Sameshwar discussed the trend during the company's second-quarter earnings call. He said consumer sentiment remained subdued amid the prolonged West Asia crisis, softer monsoons and inflation.
The company divides its consumers into three groups: India 1, India 2 and India 3. India 1 represents the lower end of its urban consumer base and is a target audience for the lower half of its Indian-made foreign liquor portfolio. The other two groups represent different parts of its consumer base.
Sameshwar said India 1 consumers were showing signs of fatigue, while India 2 and India 3 remained resilient.
The company did not quantify the extent of the pressure. Nor did it say whether these consumers were buying less frequently, moving to cheaper brands or opting for smaller bottles. The comments therefore offer a signal about consumer sentiment, rather than proof of a broader fall in demand for lower-priced alcohol.
United Spirits said it was working on a calibrated price and pack structure to cater to all three groups. It has also relaunched J&B Scotch as a 100% Scotch product at what it describes as an attractive price point, with the India-UK free trade agreement enabling the proposition.
ALSO READ | United Spirits Q2 Review: Premium Sales Rise 6.3%, But Profit Falls. Why Brokerages Are Split
A Wider Product Mix
The push for growth is also taking alcohol companies into new products and formats.
United Spirits has launched Smirnoff Ice, a ready-to-drink product, in Goa and Mumbai, with Bengaluru next on its rollout plan. It is available in 4.8% and 8% alcohol-by-volume variants.
Radico Khaitan is expanding its flavoured vodka range. Its Magic Moments Aam Panna launch in August brought a familiar Indian summer drink flavour into the portfolio.
These launches reflect efforts to widen product choices and reach different drinking occasions. The companies have not, however, said that these initiatives are a direct response to the wallet fatigue identified by United Spirits.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.