Royal Stag-Maker Pernod Ricard Set For Premium Foray As It Targets India's Changing Palate
India, which is now 13% of Pernod Ricard's global business, is now its second largest market overall.
French alcohol major Pernod Ricard SA is set to launch a new range in India called 'Xclamation', Chairman & Chief Executive Officer Alexandre Ricard said in an earnings call last week.
"The underlying consumer demand is very strong in India. And the premiumisation trends are still very dynamic," he said. The company has an extensive portfolio of premium brands, such as Chivas Regal and Absolut vodka.
Premiumisation has caught up in India in the last few years, where rising disposable income has given consumers a chance to elevate their preferences in everything from cars to soaps.
In the alcohol-beverage segment, the trend is being fueled by favourable demographics, rising disposable incomes, increasing social acceptance of alcohol, and a slew of new product launches in the premium category.
In a post on LinkedIn, Poonam Chandel, managing director of Delhi-based NeuWorld Spirits, said she spotted a product called Seagram’s Xclamation by Pernod Ricard on quick delivery platform Zepto.
She said the trademark was registered under Pernod Ricard in two categories — In Class 32 (soft drinks, mixers, aerated beverages) and Class 33 (alcoholic beverages).
"This doesn’t look like just another quiet launch of a mocktail mixer. This feels like a surrogate prelude to something bigger — possibly a whisky, brandy, rum, or even a gin under the same Exclamation identity. A contemporary name, bold enough to either soar spectacularly or boomerang completely," she said.
Strong Sales, But Maharashtra Factor Clouds
According to Alexandre Ricard, India has become blended whiskey Jameson's second-largest market by volume. Jameson is also the number one imported spirit brand in the country.
"India, which is now 13% of our global business, is now our second largest market overall," he said.
India has become blended whiskey Jameson's second-largest market by volume. (Image: Pernod Ricard)
In the fiscal year ending June, sales in India grew 6%. Royal Stag — Pernod Ricard's best selling brand by volume — posted double-digit growth, as per a company statement.
What concerns Pernod Ricard is the dent expected from the rise in excise tax in Maharashtra, a key market. In June, the state imposed its sharpest hike in excise in over a decade.
"The tax has been implemented mid-July. It's a 50 percentage point increase, moving from 300% tax to 450%. It's likely to have an impact, which we roughly estimate to probably above one third of RSP (retail selling price) increase in that state," the CEO said.
The Indian alcoholic beverage industry is expected to witness a revenue growth of 8-10% in the current financial year, reaching Rs 5.3 lakh crore, according to a research report from Crisil. This growth continues the momentum seen over the past three years, with a CAGR of 13%.
