The Delhi Government has decided to grant license in form L1, L1F and L2 for the wholesale vend of Indian liquor in the National Capital Region (NCR) of Delhi for the licensing year 2023-24 with effect from October 1, 2023.
The Excise Department has said that the prescribed forms can be obtained from its website and that there would be a processing fee of Rs. 5,000 for each license. The Department said that the terms and conditions for the licensing 2023-24 would be the same as that of 2022-23. The government said that it reserved the right to review the duties / fees to be paid / payable in case of any amendment to the law related to liquor and bonded warehouses.
The Department said that in case of existing licensees / registered brands active up to September 30, 2023 there is no change in the EDP / right structure / label / source warehouse etc. The registered brands for the year 2022-23 may be registered for 2023-24 on the same terms and conditions of the previous year, consequent to the payment of requisite fees and submission of undertaking / affidavit of the same.
It said that for new registration of brands applications received without complete information and supporting documents as required in the prescribed form along with annexures shall be liable to be rejected.
These changes are to ensure continuity of supply and the amendments will be in place till the new policy is formed. This will be third time the Delhi Government is giving the extension.
It may be mentioned here that the previous policy introduced in 2021 by the Aam Aadmi Party (AAP) government had to be scrapped as it ended up in scandal which is currently under investigation.
The excise department has proposed to extend the existing 2020-21 liquor policy by six months till March 31, 2024, to ensure the continuity of liquor supply. The excise department will issue a formal order in this regard.
Expert welcomes policy
Mr. Raju Vaziraney, one of the veterans of the wine and spirits sector and presently Adviser and Business Development Head of Amrut Distilleries, has welcomed the policy saying technically it is a new policy thereby allowing new companies to get registered and pay one-time fees and not fees from retrospective effect. The Companies will be encouraged to bring – in new brands, thus ensure more variety of brands, more consumer choice. However, he said the new policy gave only two days for companies to submit all documents.
However, he reiterated that the salient features are a) Existing Licences to be renewed by giving an undertaking / affidavit; Existing licences are renewed till March 31, 2024; Existing brands with existing EDPs to continue till March 31, 2024; Existing brands to pay proportionate fees of six months and not 18 months as was the practise in the policy of 2022-23.
In order to ensure continuity of supplies the online transparent system worked overnight & supplies commenced from October 3, 2023. However in view of paucity of time lot of prominent brands are under process of being made available. Mr. Vaziraney said that however, the challenges are that Delhi will have to wait till six more months to get a full-term year policy with possible participation of private trade thereby offering a great buying experience. The vends at the airport could also open next year as presently a world class city like Delhi does not have any vends at the airports
It is expected that Delhi will have a full year policy which will bring-in consumer choice brands and also bring – in reforms in terms of more liquor stores, more in trade outlets, he added.
IWSR Drinks Market Analysis has announced the appointment of Julie Harris as its new CEO. The transition comes following Mark Meek’s decision to step back from the CEO role and to take up a non-executive director position within the company, the world’s leading source of data and intelligence for the $1.5 trillion global alcoholic beverage market.
Julie Harris joins from Comparison Technologies, a leading tech-enabled comparison and customer acquisition platform in the home digital services market, where she was CEO since 2019. Prior to this, Julie held several CEO roles across a number of sectors, including WGSN, the global leader in trend forecasting for the fashion and retail industry.
Julie Harris commented, “I am delighted to be joining the very talented team at IWSR at such an exciting stage in its evolution and to build on the phenomenal growth of the last few years. Mark leaves the company in fantastic shape and I look forward to working with our global teams to continue to develop new and exciting products for our valued clients.”
Under Mark Meek’s leadership, IWSR has delivered annual revenue growth of 20% and has significantly expanded the coverage and functionality of its core database. The company has also developed a range of new products, including annual strategic consumer sentiment studies on topical issues such as e-commerce, no-and-low alcohol drinks and the impact of Covid-19. In conjunction with its strong organic growth, IWSR has also completed the acquisition of Wine Intelligence France, broadening its coverage of the wine sector.
Julian Masters, managing partner at Bowmark Capital, leading private equity investor and IWSR majority shareholder, commented, “Mark has been both a great leader of IWSR and partner to Bowmark, driving transformational change during his tenure as CEO. We thank him for his significant contribution to the company’s success and are delighted that we will be continuing to work together in his new role. We look forward to working closely with Julie Harris on delivering IWSR’s next phase of growth and continued product development.”
Mark Meek said, “I’m incredibly proud of what the IWSR team has accomplished, with the support of Bowmark, since the management transitioned from our founder. The business has grown strongly, and we’ve considerably enlarged our talent base and product range. The future continues to look bright. So now, after nearly 10 years, I believe it is a great moment to hand over the reins of the business to the talented Julie Harris. I look forward to being part of the IWSR story as a non-executive and will give Julie all my support to ease her into the new role.”
The total sales of Indian-made foreign liquor (IMFL) products were 388 million cases in 2022, up from 305 million cases in the previous year with demand in all major segments like rum, gin, vodka, whisky and brandy rising. The rise has been the sharpest in premium products with their portfolio now accounting for a fifth of all the whisky sold in India and consequently demand for glass bottles and packaging material has shot up.
The bottling and packaging segment is a key component and along with ENA it accounts for over 65% of raw material costs for IMFL operators, who have been requesting price increases from the respective state governments, to offset high input costs.
While excise departments have their own yardsticks to concede price rise, the alcobev industry has to think of ways of bringing down raw material costs. One of the ways is to push their supply partners to go for innovations in glass bottling and packaging. Already, we are seeing a number of new packaging and bottling solutions such as bag-in-box, ceramic glass bottles, bag-intube, whiskey pouches and more. But the premium segment cannot do away with glass bottles as glass has its own charm. Design comes in play here.
All in all, the market of the glass bottle and packaging industry is expected to grow phenomenally, even as some companies are giving up mono-cartons. Extensive R&D to introduce biodegradable and sustainable packaging materials due to rising environmental concerns are fast gaining currency and companies are becoming increasingly environmentally sustainable entities.
Value creation without cutting corners
In view of its importance, Ambrosia at its 2023 Indspirit Conference in Delhi, organised a session on ‘Innovations in Packaging for value creation: cut cost without cutting corners’. The panellists included Srinivas Mantri, Sr Procurement Manager, Beam Suntory India; Vinod Sharma, Assistant Vice President (Commercial) Alcobrew. The session was moderated by Bhavya Desai, Group Head & CEO, SAP Media Worldwide Ltd. who set the tone by stating that in a competitive environment, the alcobev sector had to come up with bottling and packaging innovations for enhancing customer experience.
Abnormal increase in alcobev sales
Mr. Vinod Sharma said that in the last one and a half years, there has been an abnormal increase in alcohol sales and companies need to religiously work on cutting costs in a highly competitive world, without compromising on quality. The alcobev sector is banking on innovation of reducing weight of glass bottle while ensuring that it is not susceptible to breakages.
He mentioned that in the last two to three years there have been several innovations / techniques in bottling and packaging. One is the NNPB (Narrow neck press and blow) technique which can reduce weight of glass bottle up to 10 to 12%. However, over 90% of glass manufacturers in India have not adopted this technology due to initial investment costs. There is no substitute for glass bottle, particularly with premiumisation gaining currency, however glass manufacturers in India do not have adequate infrastructure to make bottles the way some foreign companies do.
Smart caps becoming smarter
The other areas the industry could look at includes smart caps with multiple options now with HDPE and metal combinations. “Smart cap is becoming smarter by the day.” Similarly, shipper cartons there are so many different varieties of material.
Sustainability should be key
Bhavya Desai nudged the panellists to talk about sustainability in packaging and Prof. K. Munshi, former IIT faculty, said while cost cutting is a factor by reducing bottle weight, making it compact etc., the sector should emphasise on value addition and how the consumer is benefitted. He gave a Japanese example where a manufacturer was dispensing Sake in small glasses which could be reused. “Sustainability also means next use of the product.” Most of the packaging is now thrown in to the garbage, he said and urged the industry to ‘put their minds together’ on sustainable packaging.
Innovation officers in companies
Prof. Munshi said presently the onus on cost reduction is on the bottle manufacturer which cannot happen due to reasons best known for the manufacturer. Hence, there is need for the alcobev sector to collaborate with the bottle supplier with regard to innovation. Companies should have innovation officer on board and whose full-time job has to be on innovation and value addition.
No alternative to glass bottles in premium segment
The professor underlined the importance of ‘thought process’ and research. “Whatever new technology comes in, one has to look at shapes, colours, aesthetics, the feel etc. how to get the maximum flavour, how to hold the bottle. These issues need to be looked into in a professional way. The user experience has to be factored in. You see many a time, empty bottles are kept as souvenirs. And as Indian companies we should think of what Indianness we can bring to the product through shapes, colours, culture etc. and how it complements with the bottle and the liquid within.” There is no alternative to glass bottles for premium category of alcobev as consumers do not prefer premium liquor in PET bottles.
Symbiotic relation between technology and design
While the big companies can bring in cost benefit partnering with the suppliers, the small players should leverage the flexibility they have by experimenting to the extent possible to offset costs. There is need for companies, irrespective of the size, to orient themselves to innovation and documenting it, even while adopting the best practices from around the world. Product development departments need boost. “Technology drives design. Development of technology takes a little longer, design is quicker but there is a symbiotic relationship between technology and design.”
Kaizen, continuous improvement to remove inefficiencies
Srinivas Mantri, Senior Manager, Beam Suntory India, talked about how the company came from a ‘Japanese thought process’ where continuous improvement or ‘Kaizen’ was in place. The idea is to keep removing the inefficiencies in the system. “Any innovation in our sector, it should factor in enhancement of customer experience and sustainability, giving back to the society, to nature.”
Beam Suntory is always working on these aspects, he said and mentioned that such processes had been implemented across different SKUs. “We have reduced the weight of the bottle, elevated the feel of the bottle, improved the label panels, reduced breakages.” Talking about glass bottles, he said, ‘see the liquid in the bottle, feel the bottle with hand and then taste the liquid… and also sound of the opening of closure…. consumer experience is involved and is demanding’. “The consumer wants something nice and something new.”
Bars display bottles, not mono cartons
He mentioned how in bars, one does not get to see mono cartons, but only bottles showing the liquid. Underlying the importance of thought process, Mantri said that from sourcing to the brand and to the consumer, there is an evolving journey, hence there is need to work with partners for continuous improvement. To engage the consumer, one needs to research who the consumer is and what we are giving to him or her, then comes tying up with internal and external partners. Importantly, consumer feedback has to be factored in and the entire process is on building the brand and consumer loyalty.
Anuj Bhargava, Managing Director, Kumar Labels, said there is a trend to remove mono cartons and when that happens, the focus is on the label on how it can be more attractive than the competition. Besides taste of the product, consumers pick the bottle for reasons such as the ‘look and feel’. Aesthetics is gaining considerable importance in this highly competitive market.
About 100 odd distilleries in Uttar Pradesh, Maharashtra and other States producing ethanol have shut operations or are in the process since the supply of subsidised rice from the Food Corporation of India (FCI) has stopped since July 1, 2023. Distillers and associations such as the All India Distillers Association (AIDA) have approached the government to resolve the crisis immediately since it is resulting in distilleries sitting idle on their capacities.
On July 20th, the Government of India further amended the export policy, prohibiting with immediate effect the export of non-basmati white rice. This step was taken in order to ensure adequate availability of non-basmati White Rice for the Indian market and to allay the rise in prices in the domestic market. While this will help stabilise the price of the rixe in the local markets, this decisions have created somewhat of a crisis in the ethanol production and the set targets by the government are not going to be achievable.
The President of AIDA, V.N.Raina told Ambrosia that the Association had approached the Ministry of Consumer Affairs, Food and Public Distribution and also the Ministry of Petroleum, to avert further damage to the industry, by resuming supply of subsidized rice from FCI. The decision of the government he said had resulted in “stopping of grain ethanol industry and no production of ethanol is being carried out. We have apprised them of this issue as availability of damaged grains is almost minimum in the market, the FCI surplus rice must therefore be issued according to the allotments to distilleries immediately to enable the industry meet the goal of reaching 12% ethanol blending by the end of Oct-2023.”
Disrupts entire ethanol programme
Mr. Raina added that the distillery industry has been left without any FCI rice which is the sole feedstock available to the grain-based distilleries. “The stoppage has completely disrupted the entire ethanol programme and distilleries are left with no alternative but to stop production. This is very serious stoppage which must be rectified immediately,” he added.
Asked whether these distilleries could manage with supply of other grains, Mr. Raina said “Although the industry has choice of other grains like damaged rice and maize, but these are not available in sufficient quantity in the market and also the price of ethanol fixed by the govt. against supplies of these grains are unviable for the industry. We have been requesting the govt. to revise the prices to enable distilleries use this alternative also, although the available quantity will not be sufficient to meet the entire requirement for blending target without surplus rice from FCI. As far as sugarcane is concerned, there is nothing against supplies of sugar and sugarcane although this is the off -season period the total entire goal of blending cannot be fulfilled by sugar industry ethanol from grains is vital to fulfill nearly 50% of the total requirement of ethanol for achieving 20% blending by the year 2025-2026.”
As per data made available by FCI, in June 2,77,419.98 metric tonnes of subsidized rice was supplied to distilleries for ethanol production, a 216 per cent increase from 2022 June. In May it was 2.95 lakh metric tonnes.
Government admits shortfall in foodgrains productionThe Minister of State for Consumer Affairs, Food and Public Distribution, Sadhvi Niranjan Jyoti recently informed Lok Sabha that “Considering expected deficiency in rainfall caused by El Nino as speculated by the India Meteorological Department due to which Kharif crop production in the country may be affected…. In order to control inflationary trends and to maintain adequate stock levels under central pool for distribution under National Food Security Act and other welfare schemes for the benefit [of people], sale of wheat and rice under Open Market Sale Scheme (Domestic) for state governments, including Tamil Nadu, has been discontinued with effect from 13.06.2023.”
She further said that “State governments of Karnataka, West Bengal and Tamil Nadu have requested for wheat and rice under OMSS(D) Policy which was not acceded to due to discontinuation of sale of wheat and rice to states under OMSS(D) 2023.”Due to this the supply to distilleries has got affected. However, she mentioned that in 2022-21, subsidized rice supplied for ethanol was 49,000 MT, which increased to 10.68 lakh MT in 2021-22 and 13.05 lakh MT in 2022-23, up to July 10. Of 24 lakh MT supplied to distilleries for making ethanol so far, the maximum — 1.67 lakh MT — has been bought by Chandigarh Distillers & Bottlers Ltd, is followed by Bihar Distilleries and Bottlers Pvt Ltd (1.57 lakh MT), and BCL Industries Ltd (0.13 lakh MT). The government is expected to provide 32 lakh MT rice for ethanol during 2022-23 and with this disruption, it remains to be seen how the government will fulfil that obligation.
The price of rice supplied for ethanol is much lower compared to the economic cost incurred by FCI on procurement and storage operations: these were Rs 3,939.26 per quintal in 2020-21; Rs 3,562.49 in 2021-22; Rs 3,858.19 in 2022-23 (revised estimates); and Rs 3,918.05 per quintal in 2023-24 (BE).
Retail prices going up
The Government, in a statement, has admitted that domestic prices of rice are increasing and that retail prices have increased by 11.5% over a year and 3% over the past month. Export duty of 20% on non-basmati white rice was imposed on 08.09.2022 to lower the price as well ensure availability in the domestic market. However, the export of this variety increased from 33.66 LMT (Sept-March 2021-22) to 42.12 LMT (Sept-March 2022-23) even after imposition of 20% export duty. In the current FY 2023-24 (April-June), about 15.54 LMT of this variety of rice was exported against only 11.55 LMT during FY 2022-23 (April-June), i.e. an increase by 35%. This sharp increase in exports can be ascribed to high international prices due to geo-political scenario, El Nino sentiments and extreme climatic conditions in other rice producing countries, etc.
Non-Basmati White Rice constitutes about 25% of total rice exported from the country. The prohibition on export of Non-Basmati White Rice will lead to lowering of prices for the consumers in the country, the government has stated.
Diageo recently announced that Sir Ivan Menezes has decided to retire as Chief Executive Officer and depart from the Diageo Board on 30 June 2023, following ten successful years leading the Company. Debra Crew, currently Chief Operating Officer, will be appointed Chief Executive Officer and join the Diageo Board, effective 1 July 2023.
Ivan joined Diageo through the merger of Guinness plc and Grand Metropolitan plc in 1997 and has held a number of senior positions in the business including Chief Operating Officer; President, Diageo North America; Chairman, Diageo Asia Pacific; and Chairman, Diageo Latin America and Caribbean. Ivan has been an Executive Director of Diageo since July 2012 and has served as Chief Executive Officer since July 2013, overseeing an outstanding period of change, growth and high performance.
During Ivan’s tenure, Diageo has made great strides towards its ambition to become one of the best performing, most trusted and respected consumer products companies in the world. Diageo has grown significantly during this period, now selling over 200 brands in more than 180 markets and is today, the number one company by net sales value in Scotch whisky, vodka, gin, rum, Canadian whisky, liqueurs, and also tequila, a category in which only eight years ago the company had no substantive position. And in December 2022, Guinness became the number one beer in the on-trade in Great Britain for the first time.
Led by Ivan, Diageo has developed a leadership position in sustainability, becoming one of the top 1% of companies globally to achieve a “Double A” rating for Water Security and Climate Change from CDP (formerly the Carbon Disclosure Project), as well as a particularly strong stance on inclusion and diversity, with the company ranked number one in the UK, and number two globally, in Equileap’s 2023 Gender Equality Report. And with Debra’s appointment as Chief Executive Officer, women will make up more than 50% of Diageo’s Executive Committee from 1 July 2023. During the past decade, Diageo’s total shareholder returns have strongly outperformed the FTSE100, and the Company has continued its progressive policy to increase dividends every year. In January 2023, Ivan was awarded a Knighthood for services to Business and to Equality in His Majesty The King’s 2023 New Year Honours List.
Prior to being appointed Chief Operating Officer in October 2022, Debra was President, Diageo North America and Global Supply, leading Diageo’s largest market to 14% organic net sales growth in fiscal 2022, following on from 20% organic net sales growth in the prior year. Debra originally joined the Diageo Board as a Non-Executive Director in April 2019, before stepping down from the Board when appointed President, Diageo North America in July 2020.
Debra is the former President and CEO of Reynolds American, Inc., where she delivered strong performance growth before the company’s acquisition, having previously served as President and Chief Operating Officer, and President and Chief Commercial Officer. Prior to that, Debra spent five years at PepsiCo, where she served as President, North America Nutrition; President, PepsiCo Americas Beverages; and President, Western Europe Region. Prior to PepsiCo, Debra held positions with Kraft Foods, Nestlé S.A. and Mars, Inc.
Debra is a graduate of the University of Denver, earned an MBA from the University of Chicago Booth School of Business, and previously served as an officer in the United States Army. She currently serves on the board of Stanley Black & Decker, Inc., having previously served on the boards of Newell Brands and Mondēlez International.
Javier Ferrán, Chairman, Diageo, said: “The Board is enormously grateful for Ivan’s contribution over the past decade. Under his stewardship, Diageo has consistently delivered a truly impressive performance to become one of the most respected businesses in the world. Ivan has transformed Diageo’s global footprint, brand portfolio and strategic focus, positioning our business as a clear leader in premium drinks. At the same time as delivering consistent shareholder returns, Ivan has nurtured a diverse and talented global workforce and made significant progress on the most material sustainability issues facing our business. Ivan leaves Diageo extremely well positioned for future growth, and we thank him again for everything he has helped us to achieve.
The Board has diligently planned for Ivan’s successor, and we are delighted to have appointed a leader of Debra’s calibre to the role. Debra has been a highly valued member of Diageo’s leadership team in recent years with an impressive track record of delivery both at Diageo and across other global consumer goods companies. She has deep consumer industry expertise as well as proven strategic capabilities, strong operational performance and a clear ability to build and lead teams. I have no doubt that Diageo is in the right hands for the next phase of its growth.”
Sir Ivan Menezes, Chief Executive Officer, Diageo, said, “It has been an enormous honour leading Diageo over the past decade. I am extremely proud of what we have achieved during that time, and I would like to thank my 28,000 talented colleagues around the world for all of their hard work, creativity and passion. I would also like to thank the Board for their encouragement, challenge and support over the years.
Uttar Pradesh better known as the ‘Granary of the Nation’ is the largest sugarcane and wheat producer and the second largest rice producer in the country. In its bid to become one of the top states every which way, the Yogi Adityanath led BJP government has set itself a target of becoming a one trillion economy by 2027, for which it is laying out the red carpet for different industries, infrastructure project development, agri-produce and more. One of the verticals which is doing well is the alcohol production sector and here the Secretary General of the Uttar Pradesh Distillers Association, Rajneesh Agarwal talks about the efforts being made by the industry, the association and the state government in pushing the envelope further.
Tell us how Uttar Pradesh is a land of limitless opportunities?
Rajneesh Agarwal (Agarwal): Uttar Pradesh is indeed a land of limitless opportunities in the distillery/alcohol sector due to several reasons. Firstly, UP is the largest producer of sugarcane in India, which is a primary raw material for alcohol production, making the State an attractive destination for investment in the alcohol industry.
Secondly, the state has a diverse agricultural base that includes grains such as maize, wheat, and barley, which can be used as alternative raw materials for alcohol production and the government is encouraging the same, thus increasing the capacity of distilleries and reducing their reliance on traditional raw materials like sugarcane and molasses.
Thirdly, with a population of over 240 million people, UP has a large and growing consumer market for alcohol. Also with rising incomes and changing consumer preferences, the demand for premium quality alcohol and varieties of alcohol is increasing, supplemented with streamlined licencing process.
Finally, UP has a well-developed transportation network, with several major highways and railway lines passing through the state. This makes it easier for distilleries to transport their products to customers across the country and the world.
What has been a game-changer for the distillery sector in UP?
Agarwal: There are many factors – Expansion of Alcohol production; Ease of doing business; Robust government policies; and growing consumer base.
a. Expansion of alcohol production: In 2018, the UP government announced the new excise policy that allowed the production of ethanol from alternative feedstocks, such as maize, barley, and wheat. This decision supplemented with streamlining of licensing system and restoration of working hours from sunrise to sunset were all game-changers, opening up new opportunities for distilleries to diversify their raw material base and expand their production capacity.
In 2017-18 there were 60 distilleries in UP with total installed capacity of 161 Cr. litres of alcohol production, which in 2022-23 jumped to 85 distilleries with 346 Cr litres of alcohol production, a growth of 115% in a span of five years. While 20 grain distilleries have established in just last one year, 20 more distilleries are in the pipeline which will produce another 80 Cr. litres of alcohol.
The decision to allow the production of ethanol from alternative feedstocks was a significant shift from the state’s traditional focus on sugarcane and molasses as the primary raw materials for alcohol production. This has helped to reduce the reliance of distilleries on these traditional feedstocks and create new business opportunities for farmers and other stakeholders in the supply chain.
The policy has also helped to boost the state’s ethanol production capacity, which has significant implications for the biofuel sector. Ethanol produced from alternative feedstocks can be used as a fuel additive to reduce emissions in the transport sector, which is a key focus area for the Indian government’s energy policy.
b. Ease of doing business
The excise policies in recent years has a significant positive impact on the distillery sector in UP. It has made it easier for distilleries to obtain licenses and permits, reducing bureaucratic hurdles and increasing the ease of doing business in the state. The reduction in taxes on liquor has also made alcohol more affordable for consumers, leading to an increase in demand for alcohol in the state.
Additionally, the policy has encouraged investment in the alcohol industry in Uttar Pradesh, leading to the establishment of new distilleries and expansion of existing ones. This has helped to increase the capacity of the distillery sector in the state and generate employment opportunities for local residents.
c. Robust government policies
There have been robust and encouraging government policies from 2017 onwards. In potable liquor segment itself specific to Country Liquor (mammoth volumes with significant revenue to the state exchequer) the distillery sector volumes have grown 2.3x or at a compounded annual growth rate of 18%.
The total Excise Duty collection increased from ₹17000 Cr. in 2017-18 to ₹41000 Cr. in 2022-23. To sustain this industry growth, an investment of approx. ₹10,000 Cr. has been made by distilleries including an investment of around ₹3000 Cr. for setting up grain alcohol plants.
UP has been primarily producing over 200 Cr. litres of alcohol from molasses and there has been a paradigm shift of producing alcohol from grain too. Over 20 grain distilleries have been established in this short span which are producing around 62 Cr. litres of grain alcohol. Overall, as on date UP has over 85 molasses and grain distilleries producing nearly 350 Cr. liters of alcohol making a massive growth of 150% in less than two years.
UP has been a major contributor in the country’s ambitious ‘Ethanol Blending Programme’ having achieved highest blending of 11.89% with the national average of 11.56% as in March’23.
Rampur Distillery
Tell us about the investments that are coming in this sector?
Agarwal: UP’s alcohol sector is all set to get a shot in the arm with investments worth ₹16,392 crores. According to the state’s excise department, ahead of the Global Investors summit, the department signed 17 MoUs for setting up industries based on distillery, brewing and alcohol products. Along with this, letters of intent have been given for investments worth ₹1400 crore. These include distilleries, breweries, microbrewery, yeast units, malt manufacturing units and caramel manufacturing units.
What efforts are being made to meet the demand for 20% EBP and potable alcohol industry?
Agarwal: To meet the target of 20% EBP by 2025 it is estimated that 1150 – 1200 crore litres of alcohol would be required for ethanol purposes. In present context of having achieved over 11.5% blending, the sugar / molasses capacities for alcohol production are nearing saturation. Moving forward, grain would be the primary source to meet the 20% EBP programme.
In UP over 20 grain distilleries have come up in a short span, with 13 more grain distilleries expected by 2024. Overall UP is expected to have over 20 new distilleries (Grain + Molasses) in the next one year.
However, the Ethanol producers within the State and pan India are presently facing operational challenges due to severe shortage and availability of broken rice and damaged food grains (DFG) at the prevailing prices of the government. Ethanol producers are jointly seeking an SOS upward price revision with the Central Government for both broken rice and DFG to put Ethanol producers back on momentum.
What kind of investments have been made to increase grain capacity for potable liquor in UP, a state which has seen industry volumes grow by 2.6 times and expected to double in the next five years?
Agarwal: To sustain this industry growth, an investment of approx. ₹10,000 Cr. has been made by distilleries including an investment of around ₹3000 Cr. in setting up grain alcohol plants in UP. With 13 more grain plants itself expected by 2024 will have an additional Investment of more than ₹1200 Cr.
The state government has approved establishment of distilleries based on molasses, grains, potatoes etc. Could you let us know if the UP distillers have taken that route?
Agarwal: Traditionally, many distilleries in Uttar Pradesh have been based on molasses, as the state is one of the largest producers of sugarcane in India. However, in recent years, there has been a growing trend towards using alternative raw materials such as grains, potatoes, and other vegetables, which can provide a more diverse and sustainable supply of raw materials for the industry. Some distilleries in UP have already taken this route and started using grains like maize, barley, and wheat to produce alcohol. For example, in 2019, a distillery in the state started using maize as a raw material for alcohol production. Similarly, there are distilleries in UP that are using potatoes to produce alcohol, taking advantage of the state’s large potato production. The government is launching numerous schemes and incentives to develop agro-processing industries in UP.
The UP government has allowed production of Absolute Alcohol of Pharma grade, could you give us an update on the same?
Agarwal: The production of pharma-grade absolute alcohol in UP is expected to substitute imports and reduce the country’s dependence on imported alcohol. The state government has allocated land to set up a pharma-grade alcohol plant and several companies have expressed interest in setting up such plants.
The UP government in April’22 has given permission to commence production of Absolute Alcohol of Pharma grade from Cane crushing season of 2022-23. This has paved way for self-reliance on Absolute Alcohol of Pharma grade which till now is dependent on imports from countries like USA, Australia, China etc. The State has envisioned production capacity of 25 lac litres from the total requirement of nearly 50 lac litres currently, saving revenue of around ₹10 cr. in import substitution.
What are the challenges for distillers in UP, regulatory or otherwise, and how can the government resolve it?
Agarwal: Today, UP is proud to hold its head high for turning the major challenges into opportunities. The rapid expansion and overall growth in past years is quite evident of this fact. However, the government continues to make radical reforms in the policies in ease of doing business, simplified regulatory environment, rationalising taxes & duties, expansion of infrastructure development with better road & rail connectivity etc. The ground water being the main source of irrigation, the State’s Environmental Board is taking various measures to avoid over exploitation of ground water.
Tell us about the role of UPDA in promoting the sector?
Agarwal: The UP Distillers Association (UPDA) is an apex body of distillery industry with nearly 90 distilleries. The Association is a 40-year-old body, actively rendering services as interface between its members and both State & Central Government authorities primarily through its advocacy role for policy makers and resolving issues of the industry.
To tap the limitless opportunities, UPDA is fast spreading its wings in international arena to explore and adopt best practices and technologies across the world. In recent years, under the close guidance of UPDA President – Mr. S.K. Shukla and Vice-President – Mr. Manish Agarwal, the association has ensured industry benefits.
The UPDA conducted its first International Summit in Aug’22 with six countries participating. The second UPDA International Summit will be held in July 2023, showcasing global innovation technologies with USA, Brazil, Israel and many more countries, besides home grown technologies.
This was followed by a visit to Brazil a delegation jointly organised by the All India Distillery Delegation and the UPDA, with the objective to explore synergy and business avenues of mutual interest between Indian and Brazilian distilleries and technology providers. Brazil has achieved 27% blending in 2G ethanol.
UPDA-AIDA are planning their next distillery delegation visit to USA under an exchange programme which will explore:
1) Corn supply chain model comparison between, India and Brazil & India and USA.
2) Corn cultivation and corn grains productivity enhancement in India, GM corn cultivation in India, testing of new corn cultivators from USA, and developing a holistic model for the corn growing farmers and industry.
3) Ethanol production technology transfer from corn grains and from corn biomass (cobs and leaves-corn stover).
4) DDGS (Dry Distillers Grains Soluble) valorization, Proteins recovery from DDGS and purification, Oils recovery from DDGS and its profiling, Develop of DDGS based holistic nutritive and palatable feed for cattle and poultry.
UPDA is in process of collaboration with ‘Invest India’ wherein UPDA will interface and support bringing investments & technologies, with initial focus in bio-fuels sector and grain based distilleries.
Will UP become the distilleries hub, if so, by when and what are you betting on? How many distilleries are there in UP and how many of them are your members?
Agarwal: Out of the around 520 distilleries in India, UP itself has nearly 90 distilleries with nearly 33 more distilleries coming up in 2024. These numbers show that UP is already a distinctive hub.
UP Distillers Association’s a prime focus all along has been on potable distilleries and now fast catching up with the industry at large on grain and ethanol producing distilleries. Presently, UPDA has 16 members on board which produce over 90% of the potable Country liquor requirement of the State. UPDA takes pride in having on-board Patron members such as Radico Khaitan Ltd., India Glycols Ltd., Wave Group, Sir Shadi Lal Industries and Superior Industries. Country Liquor sales of over 9 Crores cases per annum contributing significantly to the overall excise revenue of over ₹41k Crores with target of ₹45k Crores in 2023-24.
Abhinav Jindal, founder of Kimaya Himalayan Beverages, outlines the company’s growth trajectory
What is your impression of the response to craft beers?
The craft beer industry in India is still in its nascent stage, but it is exhibiting positive indicators of expansion. The global trend towards craft beer is starting to take hold in India, and this presents a significant opportunity for the industry. Unlike developed economies, where the craft beer movement has been established for over a decade, India is experiencing high double-digit growth in the craft beer category compared to a lower double-digit growth in the overall beer market. This indicates that the craft beer industry in India is experiencing a strong upward trend and is expected to continue this path in the future. The surge in the demand for craft beer offers possibilities to innovate and introduce new products in various categories, as well as to redefine existing categories in the competitive market space. This creates a lot of opportunities for innovation and differentiation within the industry, which will further drive growth and create more choices for consumers. Overall, the craft beer industry in India is poised for substantial expansion, and businesses that can tap into this trend and create exciting new products will be well-positioned to capitalise on this opportunity.
Do you feel consumers will go back to regular beer as compared to strong beer or is it only millennials?
The market trend indicates that consumers generally prefer stronger beer over milder ones, and this preference has been evident in the high growth rates of the premium, stronger beer category. With the availability of better-quality products in the stronger beer category, consumers are more likely to stick with their preference for stronger beer, and therefore, it is unlikely that there will be a significant shift in consumer preference towards milder beer.
What are your plans for the summer season – new launches, and promotions?
We have some exciting developments this season. Firstly, we have introduced a newer bottle packaging for BeeYoung Strong 650 ml bottle, which is a one-of-a-kind innovation that is unprecedented in this industry. It is highly likely that this packaging has not been seen before in the market. Moreover, our team is actively working towards launching BeeYoung in Himachal Pradesh to mark our market presence. To further enhance our product offerings, we plan on introducing new variants in premium segment with unique flavour notes to the Kimaya’s profile, likely to be launched in a couple of months. On the marketing front, we have launched an exciting summer campaign that will be visible both digitally and on the ground. This campaign is designed to be fun and engaging, and we are actively seeking out opportunities for collaborations and event sponsorships that align with the spirit of the summer campaign in the near future.
How would you describe Kimaya Himalayan Beverages’ remarkable journey from being the latest entrant in the market just before the pandemic to becoming a company worth over 100 crores in just one year of full operation?
The pandemic has caused significant disruption in the industry, particularly impacting small businesses and homegrown brands. Despite the uncertainties and obstacles caused by the pandemic, BeeYoung, which was launched in September 2019, has managed to stay resilient with a mindful approach and strategic resource allocation. Through proactive market analysis, the company has taken effective measures to reach its sales targets and develop a robust strategy for expansion into larger markets. As a result, BeeYoung achieved a remarkable milestone by dispatching 1,00,000 hectolitres of beer in its first year of full operation, experiencing an impressive growth rate of 129%. The brand has also successfully established itself in Delhi, Uttar Pradesh, Uttarakhand, Punjab, and Chandigarh and is now focussed on expanding into other states. To meet the increasing demand in its existing markets, Kimaya Himalayan Beverages is increasing its production capacity, reaffirming its commitment to meeting its customers’ needs.
How has the company ensured enhancing product availability in the existing market, diversifying the product range, and venturing into new regions across the nation.
To enhance product availability in the existing market, Kimaya Himalayan Beverages has established partnerships with distributors and retailers to ensure that its products are widely available. The brand has successfully established its presence in multiple regions of North India including Delhi, Uttarakhand, Punjab, and Uttar Pradesh. To diversify its product range, the team is working on introducing new variants with distinctive flavour notes to cater to the changing tastes of consumers. We are working on strengthening the foothold in North India by expanding into new regions and states, such as the upcoming launch in Himachal Pradesh. We have also invested in marketing campaigns to raise brand awareness and attract new customers. Overall, we have taken a proactive and strategic approach to enhancing product availability, diversifying its product range, and venturing into new regions across the nation. These efforts have helped us to grow.
What is the industry overview on alcobev category – the shifts and trends?
The alcohol beverage category has undergone significant shifts and trends in recent years. One of the most notable changes is the growing consumer interest in healthier and low-alcohol options. Consumers are more health-conscious and looking for beverages that align with their wellness goals. This has led to an increase in the demand for low-alcohol or non-alcoholic beverages, such as hard seltzers and non-alcoholic beers. Another trend in the alcohol beverage industry is the rise of craft and artisanal beverages. This has led to an increase in the number of craft breweries, distilleries, and wineries, as well as a growing interest in local and regional products. Finally, sustainability and environmental concerns have become increasingly important to consumers, and brands are responding by prioritising sustainability in their operations and products. This includes using eco-friendly packaging, reducing waste, and sourcing ingredients from sustainable sources.
Overall, the alcohol beverage industry is evolving rapidly, with a focus on health, quality, sustainability, and innovation. Brands that can adapt to these changing trends and meet the evolving needs of consumers are likely to succeed in this competitive market.
What steps are being taken to ensure Sustainability in the alcohol and beer industry: Innovative approaches towards environmental responsibility?
The alcohol and beer industry are taking various steps towards ensuring sustainability and environmental responsibility. These steps include implementing sustainable sourcing practices, using eco-friendly packaging, conserving water, reducing energy consumption, and minimising waste. Companies are exploring innovative approaches towards sustainability, such as using renewable energy sources, investing in water-saving technologies, and using waste-to-energy technologies. The industry is responding to the growing consumer demand for environmentally responsible products and operations. By prioritising sustainability in their operations and products, companies are demonstrating their commitment to social responsibility and ensuring long-term success in the competitive market.
How would you describe the Science of Brewing: The chemistry behind a ‘Perfect Pint’?
Brewing is a complex process that blends the art and science of beer-making. It involves a variety of chemical reactions that transform simple ingredients such as water, malt, hops, and yeast into the diverse range of beers we enjoy today. The science of brewing entails understanding and manipulating these chemical reactions to create the desired flavour, aroma, and appearance of beer. However, creating the perfect pint requires not only scientific knowledge, but also artistic skill. Artistry in brewing involves being artisanal and selecting the right ingredients in the desired quantities. It also involves carefully combining the ingredients without adding concentrated hops, colour, or flavour. The art of brewing complements the science, which includes determining the appropriate temperature to boil, ferment, and so on. Understanding the chemistry behind brewing is essential for creating a satisfying and enjoyable drinking experience that caters to the diverse preferences of beer drinkers worldwide. In summary, brewing is a delicate balance of science and art that requires skill, expertise, and creativity to produce a perfect pint.
What can you do to make the industry more circular?
To make the beer industry more sustainable and reduce waste, adopting a circular approach is crucial. At Kimaya Himalayan Beverages, we have taken steps to minimise our environmental impact by recycling the used bottles. Additionally, breweries can use sustainable ingredients such as organic and locally sourced grains and hops, as well as switching to renewable energy sources like solar or wind power to reduce their carbon footprint. Breweries can also reduce packaging waste by using biodegradable materials. Furthermore, minimising packaging waste by using lightweight materials or reducing packaging size can be another effective approach. Lastly, partnering with local farmers to source ingredients can reduce transportation emissions and support the local economy. Adopting these circular approaches can significantly reduce waste, promote sustainability, and help create a more environmentally friendly product. As businesses, we have a responsibility to act towards becoming more sustainable for future generations.
How would stress the importance on the Art of Beer Labelling: Design Trends and marketing strategies?
In the beer industry, the art of beer labelling is a crucial element that plays a vital role in attracting and retaining customers. A well-designed beer label not only conveys essential information about the beer, such as its flavour and ingredients, but also serves as a marketing tool that sets the brand apart from its competitors. As design trends in beer labelling continually evolve, companies are embracing creative and eye-catching designs that appeal to a broad range of consumers.
In a first for the Maison, the acclaimed fashion designer transcends couture and Cognac in a special collection featuring a collectible sneaker, Masterpiece decanter, and Limited Edition bottle.
Hennessy is recently a collaboration with the world-renowned British Artistic Director Kim Jones. In an audacious meeting of two icons, the Hennessy X.O x Kim Jones collection bridges street and luxury in a unique celebration of the legendary blend’s impact on culture.
Interweaving the richness of Hennessy X.O’s 150-year heritage with Kim Jones’ creative vision, the collaboration features the Hennessy X.O Masterpiece designed by Kim Jones, the Hennessy X.O Limited Edition bottle by Kim Jones, and in a first for the brand, the HNY Low by Kim Jones. This also marks the first time Maison Hennessy has partnered with a fashion designer, and that Kim Jones collaborates with a spirits brand.
“We are thrilled to embark on a new odyssey blending Cognac-making and couture with Kim Jones, a creative master of our time,” said Laurent Boillot, Hennessy CEO. “Inspired by the emblematic personality of Hennessy X.O, Kim has developed a resolutely contemporary collection that is destined to make an impact on culture today and in the future.”
For Hennessy X.O, Kim Jones pays tribute to Cognac-making and couture, two processes that touch on an understanding of science and the natural world as well as artisanal craftsmanship and savoir-faire. He follows in the footsteps of a formidable lineage of great masters who have helped cement Hennessy X.O’s cultural resonance over the years, including Frank Gehry, Cai Guo-Qiang and Ridley Scott.
“I’m fascinated by the rich heritage of Hennessy, a household name behind which artisans have spent hundreds of years creating this special cognac,” says Kim Jones. “Storytelling is very important for me regardless of what I’m designing or who I’m collaborating with – I want my designs to educate and inspire people through the stories they tell.”
Designed by Kim Jones and crafted in an LVMH-owned shoe factory in Italy, the limited edition HNY Low by Kim Jones is inspired by early basketball shoes. It is made of a light Cognac-coloured nubuck leather, a material that takes on the patina of time, a reference to the precious eaux-de-vie.
Contrasting with the classic upper, a technical sole in tonal grooved rubber features an imprint of Cognac vines and the Hennessy X.O x Kim Jones logo on its underside, while the initials KJ and the Hennessy bras armé emblem discreetly adorn the heel.
“I wanted it to be elevated and chic, to reflect both the long heritage of cognac and my own design values,” says the designer, who also transposed the curves of the Hennessy X.O bottle onto the sneaker. “I wanted it to feel like you’re almost looking into the bottle. It’s a glass of Cognac in sneaker form.”
True to the sneakerhead aesthetic, Kim Jones made packaging a part of the overall experience. Each pair of HNY Low by Kim Jones comes sheathed in cotton dust bags bound by a high-end drawstring, a shape recalling bottles that used to be wrapped in thick paper during travel. The sneakers are presented in an oak box that revisits the barrels used to age the eaux-de-vie, its wavy top echoing the plateau for the Hennessy X.O Masterpiece designed by Kim Jones.
Retailing at a suggested price of 650 euros, the HNY Low by Kim Jones will drop in March 2023 in partnership with HBX as the global exclusive online retail partner, and in selected retail spaces.
Designed exclusively for Hennessy by Kim Jones, produced using 3D printing technology, and finished by hand, the sculptural Hennessy X.O Masterpiece has been produced in only 200 examples. The decanter demonstrates how humanity and technology can work together to create something unique, “like a piece of bespoke couture for a bottle,” the designer notes.
The Hennessy X.O Masterpiece draws inspiration from the making of Hennessy X.O, an art perfected by eight generations of Master Blenders. A specially developed titanium casing entirely encapsulates the bottle like an architectural second skin. Its twisting folds evoke both the couture technique of draping and the way in which, at the turn of the 20th century, Hennessy bottles were carefully hand enveloped in tissue paper as a way of protecting their fragile parchment paper labels. Its base, an undulating oak plateau, nods to the barrels used to age eaux-de-vie that would eventually be blended to create Hennessy X.O.
While the bottle is entirely obscured from view, the Cognac can be extracted using the fusil designed by Kim Jones, an elegant and playful ritual to serve a glass of the Hennessy X.O blend. As a finishing touch, the decanter itself has been dipped in gradient colours, an effect inspired by the shades of the different eaux-de-vie selected by the Master Blender to compose Hennessy X.O.
Says Kim Jones, “When I saw how the vintage Hennessy bottles were wrapped, it spoke volumes to me about how precious each one is, and how they were handled. I was particularly touched by their history, and the sense of how generations have dedicated their time to making each step of the process better and better. That same process also holds true with fashion.”
The third element of the collaboration is the Hennessy X.O Limited Edition ‘ready-to-wear’ version of the decanter specially imagined by Kim Jones. The Hennessy X.O bottle is encased in an aluminum second skin, its structure showcasing the signature shape of the bottle while evoking a couture silhouette. A true representation of the merger of fashion and culture with excellence and legacy, the limited edition bottle is the final piece of the Hennessy X.O x Kim Jones partnership.
n time for the collection launch, Hennessy X.O unveils The Fabric of Time, a campaign video featuring a cameo of Kim Jones as he steps into the Hennessy X.O universe. Created by French creative trio Bleu Désert, the video places the collection at the convergence of human and mechanical movement.
Through the artistic mind of Kim Jones, the piece introduces a strange futuristic environment, halfway between a distillery and an haute couture atelier. An elusive robot takes the viewer through the space, slowly uncovering the inspiration behind the poetic details of The Fabric of Time as it passes next to an imposing mechanical alembic system. As the robot enters the main room, the Hennessy X.O Masterpiece designed by Kim Jones is revealed under the concealed watchful eye of the designer.
The Fabric of Time and collection items will be displayed in select global retail locations, each evoking the futuristic elements of the collaboration and video through interactive content and experiences.
The world’s most awarded rum welcomes back Roberto Ramirez Laverde as Global SVP, Bacardĺ rum, effective immediately. Roberto takes on an open role following the promotion of Ned Duggan to Global Chief Marketing Officer of Bacardi and President of Bacardi Global Brands Limited. Roberto reports to Ned and joins the Marketing Leadership Team. He will be based in Bermuda.
During his previous tenure at Bacardi from 2013-2019, Roberto contributed to building the premiumisation strategy for the company’s aged Bacardĺ rums and Facundo rum collection. He contributed to launching the iconic rum brand’s portfolio of premium, aged rums and building the architecture that continues to define the premium rum category. Earlier in his Bacardi career he led the Rums Category for Latin America and Caribbean Region, originally joining Bacardi in 2013 as Marketing Director for Mexico. There he supported brands across the portfolio including Bacardĺ rum, Grey Goose Vodka, Bombay Sapphire, Dewar’s Scotch Whiskey and Patrón Tequila.
“In addition to being a brilliant marketer, Roberto understands the value of consumer mindsets, and equally important, he gets Bacardi. He knows our people, our culture and brings a strong track record of collaborating that is key to continue unlocking even greater growth for the brand across the globe,” says Ned Duggan.
Roberto rejoins the brand from Mastercard in Latin America and the Caribbean where he served as Senior Vice President Marketing and Communications for the last four years.
“I am thrilled to be back at Bacardi and to work with the incredibly talented team who has been building and leading the brand. Together, I know we will build Bacardi’s next great story,” says Roberto Ramirez Laverde.
Originally from Mexico, Roberto is fluent in Spanish, a father of four girls and a multi-awarded marketer, including “1 of the 10 most Effective Marketers in Latin America” and most recently, “Best Regional Marketer in Latin America” by Adlatina, an AdAge partner.
With offering some of the best global spirits and portfolio on offer and an aim to establish itself as the home for premium spirits across categories and create human connections while focussing on sustainability, Beam Suntory has major plans for India. In an interview with Ambrosia, Neeraj Kumar, Managing Director, Beam Suntory India talks about the journey, their aim and the Indian consumer. Excerpts:
You have been associated with the company for over 15 years. How has the company grown in India over those years? From then to Now?
Beam Suntory is a proud custodian of world-renowned spirits whose legacies can be measured in centuries. We are a leading premium spirits company and the world’s third largest as well. Over the last few years, we have introduced some of the world’s most exclusive brands from our global portfolio to the Indian consumers, providing an opportunity to access some of the most sought-after spirit experiences in the world.
We have also made our successful debut into the Indian whisky space with Oaksmith Indian Whisky inspired by Japanese craftsmanship. Apart from this we have also launched more than 10 renowned Japanese brands from The House of Suntory – Yamazaki, Hibiki, Suntory whisky Toki and Roku Japanese Craft Gin. We have strengthened our Scotch brands portfolio with Bowmore, Laphroaig Select and Teacher’s Highland Cream Reserve and continue to embolden our Bourbon whiskey portfolio with Jim Beam and Jim Beam Black Kentucky Straight Bourbon whiskey.
Our aspiration of reaching $1 billion in sales by 2030 continues to drive our premiumisation journey in India. We strive to deliver a portfolio that combines the best of the East and West, with an unwavering emphasis on quality. We have invested in capacity and our people capabilities and proud to be certified as a Great Place to Work in India, three years in a row.
The Indian liquor market is expected to grow by 7% annually in the 2021-25 period, with whisky and spirits among favourites. What do you think are the key drivers in India?
The increasing demand for luxury spirits and premiumisation among Indian consumers signals a greater emphasis on quality. With rising disposable incomes, exposure to global culture and a desire for premium products, purchasing habits are evolving, making India an appealing market for global and Indian brands.
The channel landscape has also seen a dramatic shift in specialist store infrastructure. In addition, consumers now enjoy world class on-premise premium experiences and cocktail immersion, specially led by whiskeys and gins. The Indian consumer base is expected to grow and is witnessing a trend towards premiumisation. We expect a greater thrust on new innovations across whiskies, gins and vodkas, presenting an opportunity for cocktail craft as well as beverages for refreshment occasions. These trends will continue to drive growth at the top and premium end of the market.
What is Beam Suntory’s strategy to expand the India market?
For Beam Suntory, India is a strategic market with a long-term growth ambition. The company continues to deliver strongly along its ambitious goal of reaching $1 billion in revenue in India by 2030. Our ‘Yatte Minahare’ spirit inspires us to dream big and our commitment to the India ambition is consistent with our objective to develop our business scale sustainably in India and join our other large markets like the US and Japan.
Beam Suntory aims to establish itself as the home for premium spirits across categories and create inspiring human connections, while maintaining an integral focus on sustainability. The company continues to develop its presence here with robust investments on capability building, capacity expansion and inspiring top talent to join our global talent pool. With the early signs of success with Oaksmith whisky, we have a long-term commitment to build a business of scale whilst driving premiumisation.
You mentioned that by 2030 the company would touch $1billion in annual revenues in India, is that objective on course? Can you share the revenues from India as of 2022 across categories?
The Indian market is advancing towards quality over quantity and our goals for the Indian market are in line with the consumers’ needs catering to their discerning palates. With leading brands like Teacher’s, Jim Beam and Oaksmith and a range of luxury and premium products, we are confident in our ambitious goal for 2030. Over the past two years, we have accelerated our current portfolio, gaining value growth outperforming peers in the market. Our portfolio has been crafted carefully for Indian consumers and guided by our competitive advantage of ‘East Meets West’. These include principles of ‘Gemba’ (real consumer and customer insights from the points of consumption) and ‘Monozukuri’ (an unwavering commitment to quality from Seed to Sip). Our consumer-first mindset will continue to develop our portfolio to pioneer and leverage category, channel and consumer trends.
Since the launch of Oaksmith, it has become a very popular product. Can you share the market share, cases sold, etc. for the brand? Will the whisky be made available in the other markets as well?
After a successful launch in 2020 in Maharashtra and Telangana followed by expansion in over 20 markets, Oaksmith is at the helm of reinventing the Indian whisky segment. As a result of consumers tremendous response, Oaksmith has already sold 1 million cases since its launch, reinforcing Beam Suntory’s commitment to lead the growth and premiumisation of the Indian spirit’s market. With multiple international accolades behind its name, including the London Spirits Competition, we remain optimistic of this brand’s future in the market.
There is a major push towards sustainability in the industry. What are Beam’s plans towards the same?
Inspired by our Proof Positive commitments and Growing for Good vision, leaving a positive impact on the environment is central to Beam Suntory’s business and fundamental to its culture across every facet of the value chain. At the start of 2021, we made a global announcement to invest more than $1 billion to make positive impacts on the environment, consumers, and communities through our Proof Positive programme.
We have been making significant progress on this vision both globally and in India. Some of our local initiatives include
• Reduced dependency on single use packaging, starting with our range of Teacher’s and Oaksmith.
• Tree plantation project in Mumbai and Goa.
• Donation of USD 150,000 to NRAI to support workers in the F&B community during Covid-19.
• Donation of $600,000 to British Asian Trust, Confederation of Indian Industry (CII), National Restaurant Association of India and Government-led relief efforts to mitigate the shortage of hospital equipment supporting Covid-19 relief during the second wave.
What is your understanding of ‘Growing for Good’, can you break it down for us?
Our vision of ‘Growing for Good’ guides us to demonstrate a commitment to social responsibility and sustainability by promoting ethical and environmental-friendly working practices and behaviours. It applies both to the company and to everyone within the company and relays that the bigger we are, the greater our positive impact can be.
As a business that heavily relies on natural resources to make products that delight consumers around the world, we believe it is our responsibility to give back and leave the planet in a better way than we found it. To further define this vision, our long-term sustainability strategy – Proof Positive sets bold targets for us. Resting on pillars of nature, community and consumer, it guides us to make actional change within a defined timeline that protects the planet, offers education and expanded choices to consumers and gives back to our society.
The Ready-to-Drink brand sales has grown 16% driven by performance in Japan, Australia and the US, any plans for that category?
The emergence of the RTD (Ready to drink) market in India is growing at a fast pace and is bringing a distinct change in drinking behaviour. RTDs are popular since they come in various flavours and variants that are low in alcoholic strength and suitable for the refreshment and light experience. We are understanding the consumer needs and bringing forth products in response to their evolving preferences and will continue to monitor this space to guide our future business decisions.
