As the Indian alcoholic beverages (alcobev) industry rides out the storm of disruptions and uncertainties caused by the Covid-19 pandemic, it is time to take stock of setbacks, revisit market sentiment, nurture the supply chain and fine-tune strategies to meet the ‘new normal’.

Brews & Spirits Expo is being organised at the right time! It will be held between 4 - 6 September 2024, at KTPO Convention Centre, Whitefield in Bengaluru. The need of the hour is to bring in more investments into the sector, encourage innovation, increase domestic manufacturing capabilities and enhance exports.

With this in mind, Brews & Spirits Expo aims to deliver value to the alcobev ecosystem and provide a platform to foster partnerships within the industry, to convert potential into business.

Growth Factors

After shedding its social taboo and becoming a part of the social interaction among India’s young population, alcobev consumption is estimated to grow by 70%, driven by lower middle and upper middle-income groups in the country. For the longest time spirits and beer were the preferred choices of Indians; but with “mindful consumption” by a growing population of health-conscious consumers the market for domestic and imported wines is also perceptibly expanding.

The rising demand for alcobev in India is also attributed to the upsurge in disposable income and increased purchasing power, rapid urbanisation and changing consumer preferences.

Growth for the alcobev industry in India will be largely driven by premiumisation of products, as well as by volume expansion in the out-of-home segment: bars, pubs and restaurants.

Alcoholic beverages are among the top three sources of revenue across most states in India, and the industry provides employment to more than 15 million people.

Market Potential

India’s alcoholic beverage (alcobev) industry is one of the biggest in the world, estimated at US$ 52.5 billion. It is expected to grow at a CAGR of 6.8% till 2023, says the Indian Council for Research on International Economic Relations (ICRIER).

According to Statista, India’s alcobev market is expected to show a 12.2% growth in volume to reach 14,712.6 million litres by 2025. Consumption of alcoholic beverages increased from 21.9 crore (people of legal drinking age) in 2005 to 29.3 crore in 2018. It is projected to increase to 38.6 crore by 2030.

According to Euromonitor International, the spirits segment in India (whiskey, brandy, rum and vodka) is expected to grow by 25% to Rs 2.92 lakh crore (US$ 41 billion) by 2022.

Domestic beer consumption was pegged at 5,533.73 million litres in 2020, and is expected to reach 9,004.74 million litres by 2025, expanding at a CAGR of ~11% in the same period.

Even the nascent craft beer segment is expected to grow at a rate of 108.59% in volume. The immense market potential has led to several brewpubs and micro-breweries – as well as innovative craft spirits – burgeoning across the country in recent years.

Tech Focus

New technologies and raw materials are waiting in the wings help in innovating new products. New methods will drive efficiency and sustainability in alcohol manufacturing. Supply chains and delivery platforms are also constantly changing.

Smart technologies such as Augmented Reality, Blockchain, Big Data and Artificial Intelligence are already at play to improve production, reduce costs, spur innovation, and to enhance consumer experience.

Technology interventions for increasing production is the need of the hour.