With Delhi showing the way will Mumbai follow suit. Perhaps the commercial capital of India will want the city to mix business with pleasure. Additional taxes will help boost the government finances.
The Delhi government has granted permission to all pubs and restaurants serving liquor to stay open till 3am — a move aimed at elevating the Capital’s nightlife, which could help revive the hospitality industry that is still reeling from the pandemic, and increasing employment opportunities.
A formal order is likely to be issued soon, people familiar with the matter said, adding that the government is coordinating with Delhi Police and other agencies for the safe implementation of the new timings. Most pubs and restaurants, barring some exceptions, are currently allowed to stay open till 1am.
Though Delhi’s new excise policy was implemented on November 17, 2021, the change in operating hours will not kick in until a specific order is issued. Though Delhi’s new excise policy was implemented on November 17, 2021, the change in operating hours will not kick in until a specific order is issued.
The Delhi government has granted permission to all pubs and restaurants serving liquor to stay open till 3 am — a move aimed at elevating the Capital’s nightlife, giving a shot in the arm to the hospitality industry that is still reeling from the pandemic, and increasing employment opportunities.
Zorawar Kalra, MD, Massive Restaurants says that it will have a huge positive impact on the entire industry and the economy of the city as all stakeholders will benefit.
The government benefits due to added tax and excise collections. The employees benefit due to added shifts requiring additional people. The customers benefit as they get vibrant nightlife and the freedom to dine at whatever time they choose. And the industry benefits due to the potential of added revenue.
Abhinav Jindal, CEO & Founder, Kimaya Himalayan Beverages had this to say “Delhi Government’s recent announcement for restaurants and bars to remain open till 3 am is an appreciated move showcasing Delhi as a progressive city on the world map. We welcome this decision as a part of the industry.
This cosmopolitan city will allow people to enjoy themselves at their convenience without rushing due to time restrictions. Moreover, it will not only encourage and provide ease of doing business in the city, but will also add up to the revenues of the hard-hit HORECA industry which sees newer opportunities after two years of the pandemic.
In addition to this, this will also help us all promote responsible drinking among consumers. They will not be under the pressure of finishing drinks, rather enabling them to enjoy for longer hours and responsibly. Further enhancing experience for consumers and industry. Look forward to witnessing this positive change in Delhi’s nightlife!”
In an official government note, deputy chief minister Manish Sisodia, who holds the excise portfolio, asked the department recently to extend the closing time of restaurants, and to ensure that no establishment is subjected to harassment if it stays open till 3am.
“As part of our policy of ease of doing business and also to bring some cultural and nightlife activity in the national capital, which will further enhance the employment opportunity of our people, the Delhi government approved the New Excise Policy in November 2021 allowing the operating timings of restaurants up to 3am in consonance with the operational timings of NCR cities including Gurugram and Noida. The final implementation is being coordinated with the other agencies including Delhi Police,” read the file noting signed by Manish Sisodia.
“In the meantime, the excise department of Delhi, for all practical purposes, [is] to consider the closing time of restaurants as 3am, and no restaurant will be subject to any harassment on account of operation up to 3am,” the note added.
Among NCR cities, Gurugram allowed pubs to remain open 24×7 while in Noida, pubs can operate till 2am. In Gurugram, pubs were allowed to allowed to open till 6 am last year but the new policy announced by the Haryana government allows such outlets to remain open 24×7. In Noida, since April 2019, all pubs can operate till 1am and this can be extended to 2 am for a fee.
Though Delhi’s new excise policy was implemented on November 17, 2021, the change in operating hours will not kick in until a specific order is issued. For example, another key change in the policy — lowering the drinking age from 25 to 21 — is yet to be implemented because the Delhi government is yet to amend the Delhi Excise Act.
While Delhi Police has not issued an official response, a senior officer said they were not aware of any such order yet. “The Delhi government has not consulted with the Delhi Police while issuing the said order. When the order was notified, the Delhi Police had raised concerns related to law and order, traffic disorder, as well as safety and security of citizens, especially women,” said a senior officer, who is aware of the matter.
There have been demands to extend the operating hours since the excise policy was implemented last November, and a group of representatives of the National Restaurant Association of India met Sisodia recently to urge the government to push the change through.
“Restaurants have already paid the excise fee as per the new policy, but continue to be restricted to the old operating timings – leading to huge business losses in this critical recovery phase for the industry. Non-implementation of this most important change is putting the industry into much deeper distress than before. This will surely negate the gains that are expected from the reforms undertaken by the Delhi government,” said the NRAI representation submitted to Sisodia.
According to Rahul Singh, trustee of NRAI, restaurants not serving liquor in Delhi are allowed to operate 24 hours if they so choose, but restaurants serving liquor operate with an L-17 licence, which only permits the service of liquor in independent restaurants till 1 am.
To be sure, the 24-hour service of liquor is allowed in restaurants inside five-star hotels, and those located in the arrival or departure terminals of IGI airport.
Restaurants serving liquor in Delhi need multiple licences from different agencies to operate in Delhi, but only the excise and police licences specify timing restrictions. The health, and shop and establishment licences given by the municipal corporations, the food safety licence given by the Food Safety and Standards Authority of India, and the fire licence given by Delhi Fire Services, don’t have any timing specifications.
Restaurateurs welcomed the Delhi government’s move
“Delhi is truly a world city, the capital of our nation, and the most visited city too. Tourists as well as the residents truly deserve a global experience. With longer office working hours and the commute, there is always a paucity of time for patrons to have a relaxed evening. Extending service of liquor in a restaurant will provide relief from binge drinking. This will increase jobs in the hospitality sector, and more revenues to the city’s exchequer. While some will question the law-and-order aspects, one has to realise that when there are people on the street and the city is vibrant, there is less crime. Look at examples of global cities and even our own airports, railway stations which operate 24/7,” NRAI’s Rahul Singh said.
Sanjeev Mehra, president of Khan Market Traders’ Association, however, cautioned against the move. “It will also not lead to any increase in business for many of the regular traders and shop owners. But the move will definitely put additional burden on Delhi Police, which is already overburdened, and may lead to increase in law-and-order issues,” he said.
Meanwhile, the BJP slammed the Delhi government’s move. “The new excise policy is going to destroy the future of Delhi’s youth. Permitting restaurants to serve liquor till 3am is nothing but promoting use of alcohol among people. It may also lead to law-and-order situation in the capital,” said Ramvir Singh Bidhuri, leader of opposition in Delhi assembly. Delhi satellites Noida and Gurugram come under Uttar Pradesh and Haryana respectively, and both states are ruled by the BJP.
The newly formed Punjab government of the Aam Aadmi Party (AAP) is contemplating upon allotting liquor vends through a tender system in its bid to shore up revenues from excise. However, the traders are not open to this idea and want continuation of draw of lots. In Delhi where AAP has been ruling the new excise policy has been welcomed not just by the industry, but also consumers. The Minister of Finance, Harpal Singh Cheema has directed officials to study excise policies of other states and plans to roll out the policy soon. Punjab is likely to pick up inputs from Delhi and other states before it announces a new excise policy for 2022-23 sometime in June to be effective from July 1. The excise department has already initiated informal discussions with the trade to understand their requirements while boosting the exchequer.
Like many states, Punjab’s major source of revenue is from excise. It has estimated the revenues for the current financial year at ₹7,002 crores, with an increase of 20% from ₹5,794 crores of 2020-21. According to media reports, the excise department has already achieved the revenue target for 2021-22.
In end March, the AAP government renewed the 2021-22 policy for a period of three months to those existing licensees who will give 1.75% excess revenue over minimum guaranteed revenue (MGR) of financial year 2021-22 for their respective groups and zones in order to maintain stability in the liquor trade. The minimum guaranteed revenue of groups and zones is estimated at ₹1,440.96 crores for this three month window and the revenue target is expected to be ₹1,910 crores.
The MGQ of Punjab made liquor (PML) called desi, Indian made foreign liquor (IMFL), beer and imported foreign liquor (IFL) of each group and zone has been increased by 10% of the corresponding first quarter of last financial year of the respective group and zone. Further, to allow retail licensees to lift liquor as per their requirement, the amount of additional fixed license fee has also been increased. The ratio of fixed and open quota of PML shall be 30:70 as was prevalent during financial year 2021-22.
It may be mentioned here that the government of Capt. Amarinder Singh had allotted vends through a draw of lots till 2019-20 and in the last two years it extended the trade licenses of those who guaranteed generating 12% excess revenue over the fixed minimum guaranteed revenue. It is learnt that the government is planning to increase the reserve price and license fee of liquor vends and also to increase the size of the group up to ₹20 crore, having 7 to 10 vends.
The government is on a mission mode to fill the coffers. The Finance Minister is on record stating that despite high liquor consumption in the state, it has been able to generate enough for the exchequer. “This is our mission now. We have to fill the coffers.” While lauding the Delhi excise policy, the Minister talked about basic difference between liquor consumers in Delhi and Punjab. “While Delhi consumes Indian Made Foreign Liquor (IMFL), Punjabis consume Punjab Medium Liquor (PML). We will have to work out our policy taking into consideration all these points.”
AAP national convenor and Delhi Chief Minister, Arvind Kejriwal had stated during the run up to the election that the AAP government would look at liquor and sand for generating funds.
India’s neighbours – Sri Lanka and Nepal – are in deep economic crisis. The crisis is a bit similar as both countries largely depend on revenues from tourism and that was severely affected due to the pandemic. Unlike Sri Lanka, Nepal is not that debt-ridden. Nevertheless, the Himalayan country is witnessing unprecedented inflation and its economy is just rolling down the mountains with no immediate relief in sight.
Hence, the Nepal Government headed by Sher Bahadur Deuba has initiated certain measures, including ban on imported cars, liquor, playing cards and nearly a dozen other “non-essential” goods to address the widening trade deficit and declining foreign currency reserves. Nepal’s central bank has said reserves are only sufficient to cover just over six months of imports, down from 10 months in mid-2021. The Finance Minister Janardhan Sharma has stated that the situation is nothing like Sri Lanka’s and that Nepal is in a “slightly better position” than Colombo in terms of production and revenue. He admitted, that although the forex reserves are stressful due to escalated imports of luxury items, Nepal is not burdened with foreign debts like Sri Lanka. Nepal’s trade deficit rose by nearly 34.5% on-year to $9.35 billion in mid-March, while forex reserves have fallen below $10 billion. Hence, the ban on some imported goods, including liquor.
“This is a short-term measure taken to prevent the economic condition of the country from going bad,” said ministry joint secretary Narayan Prasad Regmi. “The government has decided to curb imports of certain luxurious and non-essential goods as the recent surge in imports has put pressure on our economy.” The central bank had already verbally directed private lenders not to issue letters of credit for luxury goods earlier in April.
India major exporter to Nepal
In 2020, Nepal imported $5.58M in hard liquor, becoming the 142nd largest importer of hard liquor in the world. In the same year, hard liquor was the 228th most imported product in Nepal and the imports are primarily from India ($2.64M), Singapore ($1.76M), United Arab Emirates ($786k), United Kingdom ($169k), and Malaysia ($140k).
While emergency restrictions on imports of high-end vehicles might temporarily bolster Nepal’s balance of payments, the fact that imported wines and spirits represent less than 0.2% of the country’s total import value suggests that the ban will have negligible economic impact, state some experts. The heavy taxes on imported wine and spirits generate almost $55 million in the form of excise and customs,
The fear is that ban on imported liquor may lead to ‘bootlegging’. Nepal has a significant informal alcohol market. According to research by the World Health Organisation and the Nepal Health Research Council, at least 66% of all alcohol consumed in Nepal was either illegal or home-produced, making for an illicit market that is more than twice the size of the legal market.
Experts said that prohibiting the import of international spirits and wines will only compound this problem, increasing the share of illicit alternatives through smuggling across borders into Nepal and counterfeiting of popular, premium international brands.
Locally, Nepal is known for some brews that mostly are made in homes. Rakshi is the Nepali term for a traditional distilled alcoholic beverage. Its alcohol content is around 45%. That is to say as a whiskey. Nepalese drink this homemade drink during the festivals.
Production and consumption of alcohol is controlled by the Madira Aain 2031. License is required to sell alcohol. However, it permits brewing and consumption for household purposes without a license. Gongo is made from scraps of ugali and maize, fermented over several days, and then distilled through a jerry-can of cold water into a soda bottle. This has hints of ethanol, but surprisingly palatable.
Tongba is the drink of the Limbu people of Eastern Nepal and also referred as Tibetan Hot Beer. And then there is Chaang which is made from a selection of cereals.
In 2020, Nepal exported $385k in hard liquor, making it the 123rd largest exporter of hard liquor in the world. During the same year, hard liquor was the 106th most exported product in Nepal. The main destination of hard liquor exports are to Japan ($231k), South Korea ($64.1k), Hong Kong ($53.6k), Macau ($20.4k), and Belgium ($13.5k).
The fastest growing export markets for hard liquor of Nepal between 2019 and 2020 were Macau ($20.4k), South Korea ($18.4k), and Japan ($8.41k).
Ironhill India in Bangalore is located in the IT hub near Marathahalli and is spread across a lavish 1.3 lac sq. ft. making it the largest microbrewery in the world. With installation art at every corner and an ambience to match, the new outlet will serve eight varieties of original craft beer. The space can accommodate more than 1800+ people at a time and makes a perfect venue for events, exhibitions and a night out as well that can be taken up with social distancing. Since the Bangalore launch the brand has established footprints with a swanky new outlet in Nellore and Rajahmundry as well. Teja Chekuri, Managing Partner, Ironhill India gives more details.
How did Ironhill India begin its journey?
Ironhill, the wonderland of breweries started its journey in 2017 at Vizag. We wanted to be the place for people from all walks of life to chill at, with our range of brews and hip ambiance. This was followed by Vijayawada, Hyderabad, Nellore, Rajahmundry and Bengaluru, with Ironhill Bengaluru being the largest microbrewery in the world. All Ironhill outlets have something unique about them that makes them stand out.
We are also, the biggest microbrewery chain in the country with a total of seven most happening microbreweries across Southern India and gearing up to other parts of the country.
Our aim from the beginning has been simple, to give our patrons a taste of the brewtiful life, with expansive spaces, galvanising ambiance, trippy music, bespoke food menu, and tasty brews to quench the thirst for magical experiences. We cater to everyone, from beer connoisseurs to newbies, regulars to one-offs, colleagues to friends, and we are just getting started!
How different are the challenges managing outlets in the US and those in India?
From a holistic perspective, it is about running all our outlets efficiently and professionally and, in that sense, there is not much of a difference. Where the difference does arise though, is in the culture, the rules and regulations, and the needs of our patron. However, we have learned and dealt with those differences with the aim of providing the best hospitality experience across the board.
Any reason for beginning your journey in the South of India?
Being from this part of the country, we saw the massive scope, the relatively uncrowded hospitality scene, and of course, the lack of awareness about, as well as presence of good microbreweries. So, we entered the microbrewery scene in the South with the sole aim of catering to the local demographic present here and introducing world-class craft beers and indeed a world-class hospitality experience to our patron. With the burgeoning demographic that sought magical experiences, it made complete sense for us to open our microbrewery in the south.
How different are your retail outlets from the competition?
We are all about the beer and food, however, that isn’t to say that our cocktails are far behind. We provide a holistic experience, with larger-than-life spaces, a majestic ambiance, music across genres, an extensive food menu that takes influences from local as well as world cuisine, you name it, and we have. We are all about crafting experiences that are as magical and as perfect as they come.
What is your game plan for India?
Now that we have a solid footing in the southern part of India, we are looking at aggressively expanding and establishing a pan India presence in the next three to five years.
What is the scope for expansion of your craft beer outlets?
We are in expansion mode, and you will hear about us soon from all parts of the country.
What was the impact of Covid on your business?
Undeniably, Covid put a spanner in the works and caused us losses. However, we have a very proactive team and that meant when normalcy was restored, we got back to business on a war footing. Having gone through the tough times relatively unscathed, we are now absolutely gung-ho about the future prospects, as of now business is brisk and we are hitting numbers that are even better than pre-pandemic times.
What kind of styles of beer do you offer at your outlets?
We believe in innovation and experimentation, and hence we launch new brews ever so often. There are staple brews of course like the Wheat Beers, Blonde Ales, Cider, etc, but we also have new beers every month based on the season, like the Mango Ale, Mango Saison, Kiwi Cider, Coco Brown Ale, to name a few.
What kind of food menu do you offer at your outlets?
We have a healthy mix of grub-inspired by local cuisine as well as world cuisine. We have ensured that we have an extensive menu, and we cater to the palates of people from varied backgrounds, so, it would be fair to say, that we have it all.
How important is location for your outlets?
Location is a prerequisite to running a successful business. Space, high footfalls, demographic, spending power, presence of competition, and many such factors are taken into account before deciding on the location of our outlets.
Allied Blenders and Distillers (ABD), maker of iconic products like Officer’s Choice Whisky and Sterling Reserve, won the ‘Distiller of the Year’ high commendation at the Icons of Whisky India 2022.
Instituted by the London publication Whisky Magazine, Icons of Whisky celebrates the people, places and products that make exceptional contributions to the dynamic whisky ecosystem.
Speaking on the occasion, Shekhar Ramamurthy, Executive Deputy Chairman, ABD stated, “It is a great honour for ABD to be recognised by the industry. We have always kept the consumer central to our brands and have phenomenal success in Officer’s Choice, the 3rd largest whisky brand globally, and more recently, Sterling Reserve which is amongst the fastest growing worldwide.”
Architect, Interior Designer, Restaurateur, and Founder of Beyond Designs Bistro, Neha Gupta has launched a second restaurant. The new culinary offering is titled, Nineteen78, hinting at the classical influence of the cuisine on offer.
Propelled by the success of Beyond Designs Bistro, Neha takes assured steps to expand her culinary brand. The new restaurant is located at the popular Select CITYWALK, New Delhi.
Having mastered the art of offering a carefully crafted couture experience with the Bistro, she has now launched a prêt affair with Nineteen78. From a relaxed and elegant dining affair at the Bistro that is every bit cherishable, her patrons now have a chance to grab an equally memorable meal at the new restaurant.
The 48-seater multi-cuisine restaurant presents a delectable mix of European, Asian and Coastal cuisines from Vietnam and Sri Lanka. The menu sees the trained chefs revisiting certain classic dishes while also serving up some modern experimental fare. From Caesar and Fattoush salads with a twist to Chicken in spinach sauce with Orzo salad and grilled vegetables; from Sweet and spicy Hong Kong ginger fish to Caramelized dry Vietnamese chicken, and prawn linguini, Sliced lamb in hoisin sauce, there are several finger-licking options to choose from. Raspberry pie with vanilla ice cream, apple crumble & ice cream Chocolate devil cake, and many more make up the dessert menu. The restaurant also has a bar attached, offering a complete dining experience.
There is also an extensive breakfast menu with healthy as well as indulgent selections. The interiors designed by Neha and her husband Sachin Gupta of Beyond Designs, are a youthful mélange of contemporary styles. The boutique vibe of the restaurant is accentuated with colourful and quirky art and a fun bunch of lights made of steel and fiber. The marble tables with metal cast bases are paired with retro-style wooden chairs and sofa seating.
While embracing a contemporary sensibility, the restaurant and the gastronomic experience it offers retain a vintage soul.
In the late 1980s, when Ramada Pub off Church Street, next to the erstwhile popular Premier Bookshop, started vending ‘draught’ or ‘draft’ beer in mugs, it signalled the arrival of not just Bangalore’s but arguably India’s s first-ever pub, thanks to the ingenuity of Hari Khoday, who was known more for his XXX Rum then. A mug of beer cost only Rs. 2.75 paise with peanuts thrown in. It was a place where you could guzzle beer, not from a bottle, but in a mug, dispensed from a tap, connected to barrels of brewed beer got from the distillery. The concept of microbrewery came in much later. Ramada Pub was a tiny place where you jostled for space and guzzled beer with some loud music in the background.
Around the same time, The Pub, renamed later as NASA (guess one got spaced out just drinking beer then) got launched on Church Street and the music and the dim lighting gave fillip to beer drinkers to guzzle more. The Pub drew the upwardly mobile and then came Black Cadillac on Residency road which played rock music and also had regular gigs. I remember Vijay Mallya hosting some liquor-based events here for the media. These were happening places. Then there was Peco’s, Scottish Pub, Underground, Downtown and the like, all in and around Brigade Road, Residency Road, M.G. Road, becoming the city’s ‘beerholes’, if one may coin that term. And then from nowhere pubs started mushrooming across the hotspots of the city, earning Bangalore the moniker ‘Pub Capital of India’.
The city is a cauldron of cosmopolitan culture, with the tech crowd descending from all over the country and elsewhere too. The techies gave Bangalore a new edge and soon, pubs had to re-invent themselves, and voila there was the birth of microbreweries. The pubs of now are very distinct, trying to cater to the hip crowd, setting trends in not just the social drinking habit, but in cuisine, in music, in events and what-have-you. At one time, pub crawl was quite popular, now not so. With an estimated over 500 pubs in the city, these ‘beer-holes’ have to be up there to cater to the discerning and demanding beer connoisseurs and they are, mind it. From pubs to microbreweries, Bangalore or Bengaluru has indeed come a long way from the days of Ramada. Here are some of the new age breweries you can check out to get a taste of the beer world.
Geist Brewing Factory, the pioneer
Among the first to come up with a brewing factory has been Geist. It was in 2006, Geist was incorporated, thanks to Narayan and Paul and later Mohan, software guys who plunge to brew some of the finest beers Bangalore has known. Initially they made 300-400 batches of beer and then when the microbreweries in the city became ‘in’, Geist was right there. When The Biere Club opened in 2013 and later Byg Brewski, Geist became the catalyst. As the pubs grew, Geist set up its own brewery and supplies draft beer to Bootlegger, Hangover and Tipsy Bull, among many other restaurants and pubs.
The name ‘Geist’ comes from the German word ‘zeitgeist’, which is used to define “the general intellectual, moral, and cultural climate of an era”. The sentiment perfectly captures the evolution of Indian beer drinkers, and the resulting rise of the discerning Indian beer enthusiast and you bet, Bengalureans, by birth or otherwise, fall in that category.
To spread their love for beer, they set up their own Geist Brewing Factory – Restaurant and Beer Garden on Old Madras Road, serving their signature crafted beers – Geist Weiss Guy, Geist Kamacitra, Geist Rauch-a-Fella, Geist Marzen, Geist Golden Ale, Geist Witty Wit, Geist Stouter Space stout and Geist Uncle Dunkel. The ambience here is just about perfect to down a beer or two under the shade of a huge banyan tree.
The Geist Rauch-a-Fella is a smoked wheat beer, inspired by the famous smoke beers of Bamberg, while the Geist Stouter Space has delightful notes of chocolate and aromas of vanilla pods. Inspired by Luponic Distortion from Firestone Walker, the Geist Golden Ale series is designed to showcase different hop varieties. The best way to find out how all their beers taste is to go check it out, right?
The Biere Club, welcome to the club
When it opened in 2010, it started a new trend in the pub city – microbrewing and it caught on like raging fire. The Biere Club located, coincidentally on Vittal Mallya road (the man who built United Breweries, later Vijay Mallya gave Kingfisher global branding) got Bengalureans interested in microbrewing, vending beers including wheat, stout, lager and Belgian style ale. They have even experimented with ‘ragi’, locally grown millet, but one must try out the combination of strawberry & vanilla, lemon & chilli and bayleaf. The Moscow Mule created with ale and ginger ale is a drink that finds favour during summers. The Biere Club has another branch in the IT belt, called The Biere Street.
Byg Brewski, Asia’s largest brewpub
This is supposedly Asia’s largest premium brewpub – Byg Brewski Brewing Company or simply Byg Brewski, which is located in Hennur, away from the central business district. It is massive, with a sprawling 65,000 square feet of space which can seat about 3,000 people at a time in five different experience zones. Truly, the experience makes people come back for more and not just for the home-made craft beers. The ambience is an experience in itself with lush greenery and a lake within and a waterfall to boot. The microbrewery serves some amazing beers including Byg Wit (a medium bodied beer, low in bitterness with fruity esters); Byg Hefeweizen, a Bavarian style wheat beer; Byg Triple, a Belgian style strong ale; New Zealand Pilsner; Byg IPA, West Coast style IPA brewed with American hops; Coffee Chocolate Stout, a dark rich decadent stout and many more for one to quench one’s thirst and to experience some of the best brews this side of the world.
Arbor Brewing Company, everything American about it
Decade-old Arbor Brewing Company or simply ABC is supposedly India’s first American craft brewery. This has origins in Arbor Brewing Company, founded by Matt Greff who pioneered American craft beer revolution at Ann Arbor, Michigan. Having tasted American craft beer while studying at the University of Michigan, Gaurak Sikka headed straight to the ‘Pub Capital’ to launch ABC in 2012 and there has been no looking back. In 2018, Sikka took Arbor Brewing Company to Saligao in Goa and both places are rocking for their American craft beer and everything American. The wooden interiors give the place an authentic look, while what can one say about the beers ABC vends – Bangalore Bliss; Phat Abbot Tripel; Smooth Criminal; Rare Earth Lager; Michael Faricy Stout among others. ABC is the place to try highly innovative beer cocktails such as Wheat on Wheat (Ketel one vodka with mango juice, orgeat syrup and Bangalore Bliss); Chocolate Stout Old Fashioned (Michael Faricy’s Irish Stout, Johnnie Walker Red Label stirred together with chocolate and a hint of chilly; and summer refreshment in the form of 3 Spiced Mules (Pineapple and fresh ginger with Johnnie Walker Red Label served tall with Phat Abbot Tripel). ABC offers a full bar and there is a dance floor for one to dance through the night!
Toit, popular hangout
From night to Toit, it’s a beer walk. Toit in Indiranagar is an out and out brew pub, brewing a revolutionary culture, as they word it. With the promise of some bodacious brews, fabulous foods and a supreme brew pub experience, Toit has gone beyond that. In fact, the revolution has moved to Mumbai and Pune too. Toit claims all their beers are made only with natural ingredients; imported malts, the hippest of hops and the most eukaryotic of yeast, never using any enzymes, chemicals, colouring agents, artificial flavouring or preservatives, “because we want every sip to be nothing short of wholesome, heavenly, beer”. Using the unique and exotic flavours of local fruits, rice, wheat, and spices, this is Toit’s contribution to the world’s great craft beers such as Toit Nitro Stout (a very dark, full-bodied, roasty, malty ale); Toit TinTin (Belgian style fruity ale); Toit India Pale Ale (a bitter, highly hopped, English style ale); Toit Hefeweizen (a full bodied refreshing Bavarian); Toit Basmati Blonde (a light, crisp and refreshing ale, they call it a love child of India’s Basmati rice from which it gets its lightness, colour and floral aroma); and the city’s own Benga-Lager-U (a clean lager with complex maltiness and subtle spicy notes). Said to be one of the most popular brew haunts, it gives a high like no other.
Windmills, energising in a gentle way
Celebrating its decade-young journey in microbrewing is Windmills Craft Works in Whitefield. Known simply as Windmills, it is an upscale pub which has a jazz theatre where artistes from around the world have performed. On tap, they vend Hefeweizen, a Golden Ale, A Stout, 1-2 IPAs and New England IPA. For the tech crowd which makes up its clientele, Windmills offers a ‘boutique’ experience and the techies swear by it, not minding its ‘pricey’ menu. On the terrace, it serves North Indian fare, totally high end offering with a spectacular view of the sprawling tech city.
XOOX Brewmill, its Zooks, ok?
Coming to Koramangala which is peppered with some of the best restaurants and watering holes, there is XOOX Brewmill (don’t know how they came to pronounce it Zooks) which vends artisanal beers and cocktails. Spread across three floors, Zooks, is a live craft brewing space, converted from an old factory. The brewery offers eight styles of craft beers and signature cocktails like the XOOX G&T — a gin, martini bianco, Campari, red wine reduction with grape, apple juice, and tonic water, the C&C (Coffee & Conversation) — gin, black coffee, rose water, orange bitters, ginger ale and The Asian Wife, an interesting cocktail made with vodka, lemongrass syrup, lychee juice, lime juice and lemongrass haze.
BierGarten, so al-fresco
When in Koramangala, check out BierGarten, a sprawling 14,000 sq. ft and an airy, al-fresco seating across two floors. To go with this perfect setting, they’ve got about eight beer variants on tap with traditional German-style Hefeweizen, a dark Dunkel and Amber Lager being the most moving ones. They also have an outlet in Whitefield and a menu that boasts European-style cuisine.
Bier Library, for the ‘beerworm’
From BierGarten, we hop to the Bier Library, which has a beautiful open space and seating with the view of a koi pond located bang in the middle. There’s a cozy reading corner if you want your reading to transport you to another world, yes, of course, drinking the well-crafted beer and that includes a Red Ale, a Spicy Wheat Beer, and a Double IPA. They are also quite well known for their signatures that include Wittle Wit, Ale-O-Drama and Further Lager.
Druid Garden, you will like their potions
Moving to North Bangalore, which is just about seeing some fancy restaurants and pubs coming up, right perched on top is Druid Garden which has a built-in microbrewery that is run by a Chez Brew Master. Naturally, the ingredients are all sourced from Czech Republic and Germany and use recipes that have been tried and tested for years. Since they’ve opened, they’ve introduced 6 beers – Czech Pilsner, Bohemian Dunkel, Indian Pale Ale and a Basmati Lager among others.
District 6, zoned out
From one end of the city, we move to District 6, an upscale microbrewery that offers both fine dining and classic brews. With rustic and modern interiors and a blend of refined fresh German style brews, District 6 is a quaint brewery where you won’t have to shout out while in conversation with your drinking partner, the music just being right, not raucous. The microbrewery offers European, Indian and Chinese cuisine, but the beers are German-style. The brewery features open-air ducts and brewing equipment. True to its number 6, the brewery has a beer tank area; a brewery area; outdoor seating; front kitchen; public and private dining spaces.
Bengaluru is a trend setter and people from all over the world converge here for its cosmopolitan outlook and culture, unmindful of traffic. The city is peppered with so many watering holes, that one tends to forget the potholes, the chaotic traffic and work-related stress. Cheers to ‘namma Bengaluru’
The Covid-19 pandemic has continued to impact India since its arrival in spring last year. The government initially reacted by imposing a national lockdown from 23rd March to 4th May last year. The on-trade was completely closed, as were most liquor shops in every state. Places of work shut down, so many young office workers left the urban centres. With the on-trade stifled, retail purchases and consumption of beverage alcohol at home became the norm in most mainstream categories. In India, however, women and younger consumers still feel uncomfortable drinking in front of more conservative parents and family members at home. Limitations on space and refrigeration favoured spirits over beer, RTDs and – especially for young urban women – wine, all of which are usually consumed cold.
The implications of the pandemic response for India’s status as a federal republic soon became clear. The importance of excise duty income from alcohol, tobacco and fuel was brought into sharp relief as revenue streams dried up and the diminishing income from national taxes, such as GST, were used to offset fiscal shortfalls at state level. Most states responded by increasing excise duties – often suddenly and steeply – as well as charging taxpayers one-off cess payments, commonly levied by central governments for a specific purpose. Unusually, this cess (tax on tax), commonly levied by central government for a specific and clearly defined purpose (and not shared with state governments), has been applied in a number of instances at state level as a Corona-cess. Some states have been more reluctant than others to review, reduce or cancel such supposedly temporary measures. For instance, Andhra Pradesh – where the government had tried to enforce prohibition before the pandemic – imposed a 75% excise duty incre for two days just as the national lockdown ended last May; and on the same day, Delhi imposed a 70% cess on the maximum retail price (MRP) of all liquor, which remained until 7th June.
The timing of the lockdown could not have been worse, especially for beer. The category relies on young urban drinkers and after-work occasions and its peak season for consumption was about to start. When lockdown ended, bars and restaurants re-opened in most states, but were limited to 50% occupancy, and workers were slower to return to offices. Many are still working from home or – during Q1 2021 – have returned to it.
Compared to some countries, where citizens often remained risk-averse and pessimistic after the first lockdown, Indian consumer confidence seemed to bounce back quickly. Many Indians assumed – wrongly – that their everyday hygiene challenges afforded them a high degree of natural immunity to the coronavirus.
The past year has confirmed that India is squarely a brown spirits market. Whisky absorbs two-thirds of consumption in this market; brandy – with a strong presence in the south – takes 20%; and rum takes around half of that. In a total market that has shrunk by around one-fifth, whisky declined only slightly less than brandy and rum, which fell around one-quarter. Beer and RTDs suffered precipitous falls, deprived of many of the venues and occasions that had driven consumption forward. All clear spirits witnessed steeper declines in consumption than dark spirits: in each category, sales of domestically produced brands bottled in India (BII) fell away faster. Even allowing for the experimentation evident in categories such as Irish whiskey, consumers sought out brands that they knew, had earned equity and had consistent quality. In short, they sought out certainties.
Two other fundamental shifts have also occurred. Firstly, the premiumisation trend – evident before the pandemic – saw some importers shift their focus to retail, increasing its offering of high-end brands, which were previously targetted at Duty-Free and at the on-trade. Disposable income spent on going out to eat and drink before the pandemic was instead often redirected to premium-and-above products for at-home consumption. Secondly, as a corollary to this and confirming the pressure on the mainstream, was down-trading out of Indian-made foreign liquor (IMFL), either bottled in origin (BIO) or BII.
Budget-conscious consumers instead chose either country liquor or illicit alternatives, having long been deprived of licensed outlets in which to purchase their nips.
The on-trade closure has also impacted routes to market and the supply chain and it increasingly determines choice. When all outlets closed, some states permitted home delivery, which many thought heralded the long-expected rise of the e-commerce channel. In reality, this was an expedient option for retail outlets: e-commerce has not seen a consequent increase in regulation or investment since. On the contrary, drinks ordering apps, such as Hipbar, appear to have been actively discouraged.
The effects of a six-week shutdown of alcohol supply lasted long after it ended: restocking and logistics issues extended out-of-stock occurrences well into the summer months. Importers often found it difficult to source supplies as exporters were reluctant to ship to trading partners in an uncertain economy, not least because they wanted to avoid passing on rising logistics costs to consumers.
One of the responses, driven by leading country liquor suppliers, has been the emergence of intermediate or medium liquor produced locally: this refers to a price band of distilled liquor sold under licensed quota in certain states – presently Rajasthan and Uttar Pradesh only – competitively priced between country liquor/IMIL (Indian-made Indian liquor) and IMFL. Commonly the price, set by the state, is at a 25% premium to the country liquor price, a similar proportion lower than IMFL pricing.
This system has the additional benefits of almost guaranteeing state excise income and reducing the occurrence of country liquor-related health issues through better-quality product. In theory, this model should be attractive to many more states. In practice, its implementation may be limited by the relative scarcity of country liquor distillers able to produce medium liquor of the requisite quality. Nevertheless, with investment and a little covert encouragement from the states, that provision will doubtless evolve over time.
In a decentralised India, the domestic beverage alcohol industry relies on a relatively small number of states for its success. The top three states – Uttar Pradesh, Maharashtra and West Bengal – account for one-third of India’s population. The top six states account for half of the population. West Bengal is the only corporate state: the beverage alcohol industry is regulated directly through a state body. By contrast, the five largest states in the south are each home to beverage alcohol corporations.
This complexity and large size of India means that there are very few companies that are truly national. Even those that are considered national – thanks to a contract bottling network – still retain large regional brands in their portfolios. There is a small number of multinationals twinning domestic production with imports that are focussed on urban distribution shared among importers and wholesalers. India has a larger number of local distillers aspiring to convert their regional origins into a multi-region or national presence; and there are many smaller distillers, the majority of whom supply locally. Most distillers, therefore, will only be trading in one or two jurisdictions and navigating one or two bureaucracies. For the larger players, these challenges are manifold.
The second half of 2020 saw the Indian beverage alcohol market emerging quickly and largely unscathed from Covid-19 and lockdown. Leading spirits companies in particular were reporting quarterly revenues and volumes that had recovered to pre-pandemic levels. This was in spite of the on-trade remaining stifled, e-commerce failing to expand and the regulation and excise duty rises imposed by most states. However, by the second quarter of this year – the beginning of the new financial year for most corporations – this initial optimism about rapid recovery has somewhat evaporated.
The picture, though, is mixed. India’s federal state model shows up the inconsistencies between states: decisions can often be arbitrary, poorly thought through and political rather than practical, but a successful model in one state can be swiftly adopted in another. On the one hand, the Delhi state government’s legislation lowering the legal drinking age from 25 to 21 is positive for the industry. On the other, Andhra Pradesh will join Bihar, Gujarat and some other smaller states and territories to prohibit alcohol for around 250m people, which is nearly one-fifth of the population.
It cannot be overstated how the pandemic and its effects demonstrated the importance of beverage alcohol revenues to individual states’ budgets. Some state governments recognise this and are approaching their beverage alcohol policy with pragmatism by listening to the industry more attentively.
The key issues revolve around the temporary and permanent changes brought about by the pandemic. Office work may have changed permanently, calling into question whether or not urban on-trade lighthouse accounts will recover. It is uncertain when occupancy rates in on-trade venues rise above the current 50% constraint. The medium liquor system may see expansion into further states. It is also questionable whether premiumisation will persist or the second Covid-19 wave will dent consumer confidence fundamentally.
The wider economy, of course, is a determining factor. Declining disposable income has particular relevance for beverage alcohol spend. The industry is circumscribed by its investment in advertising and promotion. The pandemic has sharpened the senses of many executives and players, but left others close to collapse, unable to survive further uncertain events. States have pursued short-term solutions throughout the pandemic and it is unknown if this approach will persist. However, it is likely that the distilling capacity of the domestic industry will not grow. This has implications for all, given the contract-bottling model that has enabled the largest players to become truly national.
General Forecast Assumptions
On-Trade – In some states, the on-trade had re-opened up to 85% of its former capacity by Q1 2021. However, the occupancy restriction to 50% remains, so the real throughput is also likely to be at 50%. This will continue to affect beer and RTDs. Furthermore, on-trade sub-channels are re-opening at different rates.
Restaurants opened faster than bars; and bars faster than night venues. Whilst this appears to affect wine and premium spirits in higher-end outlets, the impact will be mitigated by the flexibility of suppliers, many of whom have switched attention to retail and targetting wealthier consumers.
Medium Liquor – Consumers in some states are now being offered a wider choice. Those who had traded down to country liquor may choose medium liquor instead of IMFL. Currently this is available in Rajasthan and Uttar Pradesh, but more states may institute this. A significant number of consumers may prefer the taste and the brands on offer in the category to IMFL.
E-commerce – When three of the larger eastern states – West Bengal, Chhattisgarh and Jharkand – permitted home delivery of alcohol, it was thought e-commerce would, at last, be stimulated by the lockdown conditions. They were soon joined by Orissa and Maharashtra. However, steep delivery charges, regulatory uncertainty, a reluctance to invest and a poor delivery-logistics framework continue to hamper growth, as well as the nature of Indian e-commerce defined on the invitation issued by the West Bengal authorities as “handling the electronic ordering, purchase, sale and home delivery of alcoholic liquors from licensed food [and liquor] outlets”. Retail competitors required to pay for annual licences have lobbied against the channel as well. Some significant platforms – Amazon, Flipkart (Walmart), Big Basket, Swiggy, Zomato and the mobile app Hipbar, reportedly backed by Diageo and, in Mumbai, Living Liquidz – responded to state-level invitations to get involved after the Supreme Court ruled in favour of home delivery from licensed retail. However, it has become clear that any bureaucratic encouragement of home delivery has primarily been one of a range of responses to the crowds that gathered outside liquor shops last year and, while recurring lockdowns may help to accelerate e-commerce, the channel will not significantly impact the industry for the foreseeable future. Informal delivery, where customers call up the liquor store and get an order dropped off by moped, already existed and will continue.
Regulation – Uttar Pradesh, India’s most populous state, had previously imposed a cess of 20 per bottle of beer. West Bengal, the fourth most populous state, increased consumer tax by 30%. Rajasthan, the sixth most populous, enacted both, adding20 per bottle and imposing a 10% increase in consumer tax. Their approach is unlikely to change. Additionally, the election in Bihar state did not return a government willing to reverse prohibition. Andhra Pradesh’s government was unable to enact prohibition but has discouraged some national players by making trading there problematic. However, it is assumed there is no foreseeable regulatory movement throughout the forecast period.
Consumer Base Expansion – India’s population is approaching 1.4bn, with less than half being of legal drinking age. The actual number of alcohol consumers is believed to be closer to 160m, only 7.5% of whom are women. Per capita rates for beer and RTDs remain low at around 1.2 litres for men and 150ml for women, re-calculated at 10 litres and 1.25 litres on estimated drinking population numbers. Wine has similar rates to RTDs, spirits are 1.8 litres per capita and nearly 15 litres on a re-calculated basis. There are more younger consumers joining the potential drinking population every year. Uptake by women reportedly increased during the pandemic.
At-Home Consumption – This trend is likely to persist beyond the pandemic. Wealthier consumers of premium spirits and imports spend for indulging at home and for gifts. The wedding industry will revive: most wine suppliers are focussing on higher-end offerings, educating consumers about its accessibility and suitability during meals, as well as drinking before and after. Beer and RTDs will find difficulty switching as their core message is based on going out and socialising rather than at-home consumption, and most consumers have insufficient refrigeration space at home.
Key Market Factors
Cultural – The legal drinking age varies from state to state. In most states it is 21, but 25 in the populous states of Haryana and the Punjab. In Maharashtra it is 21 for beer and wine, and 25 for liquor. Bigger states with a drinking age of 18 include Rajasthan in the north and Kerala in the south. Delhi is about to lower its LDA from 25 to 21.
Three states with larger populations prohibit alcohol. Gujarat has been dry for the longest, with Bihar and now Andhra Pradesh having imposed prohibition more recently. Outcomes are mixed, with Bihar and Andhra Pradesh reportedly having some of the highest per capita consumption rates for beverage alcohol nationally once illicit alcohol is factored in.
Demographic – A key driver of consumption has been urbanisation, particularly among younger LDA drinkers. The lockdown appears to have reversed this, with young office workers returning to their parents’ houses in smaller cities, towns and the countryside.
The overall population is nearly 1.4bn and grows by 15–20m or more every year. The drinking population is considerably smaller: at least half can only afford very cheap country liquor, which is largely unbranded alcohol with an estimated market of 250–285m cases.
The rapidly growing middle classes, who can afford premium-and-above, may number more than 150m. However, 98% of middle-class women and more than 20% of men are said not to drink for philosophical, religious or cultural reasons.
Some 49% of the population is aged under 19, and few drink, although younger consumers are generally more willing to consume alcohol than many of their parents. This leaves a market of between 25m and 30m people with the inclination and resources to drink IMFL.
Economic – There is little state support in India and wellbeing is the individual’s responsibility. With livelihoods uncertain but a young population inclined to optimism, the second Covid-19 wave may hit confidence hard and a volatile economy will see more cautious expenditure. Excise rates vary substantially from state to state even before the pandemic, which exacerbated the difference when states imposed cess payments to make up fiscal shortfalls.
A number of observers mention a shift to modern retail. This is consistent with state governments looking to secure the revenues they can expect from beverage alcohol and also with consumer expectations around improving retail venues.
Trade – Difficulties with the supply of stock have been widespread. It is reported that lack of supply inhibited sales, especially of premium products. The pandemic hindered logistics and rendered delivery more expensive. Brand-owner allocations have also reduced the agility to respond to demand.
A further element is that the phenomenon of medium liquor in Rajasthan and Uttar Pradesh offers more settled revenue for states and gives consumers an alternative to IMFL. One leading country liquor supplier reports now selling twice as much medium liquor as it does country liquor per month. India is unusual in that spirits demand is significantly more developed than demand for beer. While there is some interplay between the two with bang-for-buck consumers keen to maximise alcohol content per rupee delivery, there were some signs that demand for beer was beginning to develop separately.
However, strong beers of 8.5% ABV still represent more than 82% of demand. The first lockdown also affected trade, and was both severe and ill-timed – six weeks without sales, just before peak season for beer and RTDs. The on-trade revived in the second half of 2020 with near full re-opening in some states, but night and weekend curfews, combined with 50% capacity limits, continue to constrain this channel. The uncertainty of lockdown and the unavailability of liquor drove some consumers back down to country liquor, although not in the south where it is banned in five large states.
There was more limited up-trading by wealthier consumers. However, mainstream products, brands and players have been affected with some of the less financially secure domestic players closing for some months. In some of the larger states, competition in the beverage alcohol category is relatively open. In more there are state corporations set up as wholesalers and frequently as retailers too. In all states, beverage alcohol participants must navigate a web of licences, quotas and taxes, and sometimes incentives.
In certain key states, the regulatory authorities that control pricing have rationalised their price lists. In Delhi, Rajasthan, Madhya Pradesh and Haryana the correction has been downwards for higher-priced imports.
It is reported that there is shift to modern retail. This is consistent with state governments looking to secure revenues from beverage alcohol and also with consumer expectations around improving retail venues.
Political – Breweries have been investigated by the Competition Commission of India (CCI) which has now resulted in fines for collusion and operating a cartel. The reputational impact is more serious than the financial cost.
The Vodka market in India hasn’t been experiencing high level of growth for few years now. But while the regular Vodka category has witnessed a flat line, the flavours category has been witnessing good growth in the industry and nearly accounts for 60% of the overall vodka sales. Precisely the reason why you see manufacturers offering flavours of their vodka. So it is only natural that when India Glycols must’ve chosen to launch their vodka, it would be in two flavours, Green Apple and Orange.
If you remember then recently, we reviewed the Single Reserva Whisky which was also from India Glycols. The price of this product is Rs. 750 in UP is also available in Uttarakhand, Chandigarh and Rajasthan. There are also plans to take it National this year. With its price this Vodka is in the same category as some of the highest selling brands like Magic Moments and similar to Single Reserva, this vodka is also made at the company’s Kashipur and Gorakhpur plants.
Now Amazing Premium Vodka has been developed with the help of Raju Vaziraney who has been in the industry for many years and has helped in developing a lot of brands. This is a Grain-based Vodka which is infused with imported enhancers that have been brought from Germany. As you might knoe that enhancers are added flavours that provide the spirit with a premium feel. This is common in the industry and the flavoured vodka market. But since these are imported from Germany, it also is the distinguishing factor for this vodka as compared to the other vodkas made in India. The vodka is also 5-times filtered to make it smooth.
Vodka packaging is always more bolder since it needs to be attractive to appeal to the youth and women. Amazing Vodka comes packed in a frosted bottle with four colour printing and the bottle features an illustration of Mermaid suggestive of fantasy. What’s also clear is the flavour with the green colour for the label and the caps. We like the printing on the bottle, it feels premium and nice and also that the word amazing is embossed on the bottle.
In terms of nosing you get the subtle green apple flavour, which isn’t very overbearing. With a 37.5% ABV the vodka isn’t exactly very strong. But the filtration process ensures that you can nose that the spirit is refined and smooth. The aroma is also very distinctive and crispy.
With the first sip itself you can get the flavour. The spirit is smooth and it feels premium, especially since they’ve used imported enhancers. The finish is medium-longish and there isn’t any afterburn as it trickles down. There is a slight hint of peppery note in the taste to give some spice to it. But again, it isn’t overbearing. We also added a mixer to it to allow the vodka to open up a little and see what it does. Once added it makes the spirit even more milder, so may be as a tip: don’t add too much of the mixer when you choose to drink it.
So what is it that we think about the Amazing Premium Vodka. For a price of Rs. 750 for a bottle it is clear that it is targeted to users that are looking for good value for money. And of course you do have popular brands in that category already. When mixed with something that you like as you usually consume vodkas then you might feel really at home when it comes to this vodka. But our suggestion would be to not mix it with something very sweet since green apple flavour already has a hint of sweetness. But all in all, it has everything that you want from a vodka at this price point and it surely is worth a try.
It has been a long successful journey for Radico Khaitan which first produced supplied extra neutral alcohol ENA to production of their 15 brands, to creating five millionaire brands, operating 28 bottling units, going the premiumisation route, and creating world class brands in the luxury brands category. Dr. Lalit Khaitan looks back in retrospect at the journey and is confident that his son Abhishek Khaitan, who has worked alongside him will take the company to greater heights.
What effort does it take to make a company like Radico Khaitan? Can you share some insights into that?
Establishing a business from scratch requires perseverance and a clear vision. Nothing can be achieved within a few years. When my father, Mr GN Khaitan, bought the loss-making Rampur Distillery in 1972, we produced extra neutral alcohol (ENA) and supplied bulk alcohol for several liquor companies. We started production of our brands in 1999, and now have over 15 brands including five millionaire brands, and operate 28 bottling units across the country. The mantra for success is quite simple: understanding of market or segment, the audience’s taste, and taking decisions to narrow down market gaps.
What are the three key turning points that you attribute to the success of making Radico the biggest IMFL company today?
First turning point was when turned from a bottler to creating our own brands with – The launch and success of 8 PM whisky is the turning point as we started the branded IMFL business with it. We sold a record one million cases of 8 PM in the first year of its inception, a record that is yet to be broken by any other brand in India; in fact, it made it to the ‘Limca Book of Records 2001’ for the achievement. We utilised the best marketing brains and tools to popularise the product; even the commercials for the product won many accolades at that time.
Second was when we started premiumisation – with the launch of Magic Moments Vodka in 2006, followed by six versions under the brand Magic Moments Remix within two years of its release also helped us gain a strong footing in the industry. The brand established itself as the industry’s undisputed leader and category driver by capturing more than half of the category’s market share. Our decision to enter the vodka business paid off as Magic Moments rose to become the world’s seventh-largest vodka brand. I would also like to talk about the decision to go premium in 2009 with the launch of Morpheus XO Brandy as the game-changer for us and a successful PAN India brand.
Third was when we entered into Luxury segment -Then the launch of Jaisalmer Indian Craft Gin and Rampur Indian Single malt in 2018, not only mesmerised the Indian consumers, but brought a delightful experience to the connoisseurs’ world by endorsing Indian brands in the international markets. We have successfully built our brand equity in international markets and currently export products to over 85 countries.
Looking back do you feel that there are some things that you would’ve liked to do differently than today?
The way things have turned out for us, I would not change a single thing. The Branded story of Radico, which we started with in year 2006 is a perfect example of growth and scaling up.
A success of the company is directly attributed to its leaders. But how important is it to have the right team and processes in place to achieve that success?
If the team doesn’t resonate well with the vision and the mission set by the management, the whole idea of an efficient leader can fall apart. No success is assured without having employees who are focussed on accomplishing the unified business objective. In my view, anybody can copy machines, but it is manpower who makes all the difference in success and not so success.
What do you think Radico took such a long time to diversify into premium brands?
As I have always maintained, the decision to enhance the brand portfolio has to be taken after taking stock of the overall market dynamics. We entered the premium category in 2006 and that was the time when the liquor market was witnessing a shift from just social acceptance to the development of a society that enjoys drinks. The success of our premium brands attests to the right timing. Besides market leaders including Magic Moments Vodka with over 60% of the market share and Morpheus XO Brandy which has a market share of over 60% in the premium brandy segment- 1965 Rum has achieved a 10% market share in defence, Magic Moments Verve has achieved a 20% market share amongst all premium vodka brands and Rampur Indian Single Malt and Jaisalmer Indian Craft Gin are a rage not only in India but world over. This testament is proof of our timings being right and the strategy being robust.
In the last two years, the company has been churning out some great products in the gin and whisky category like Jaisalmer and Rampur? Moving forward do we expect to see more products like those?
Product innovation is of the utmost importance for us. Our latest offerings including Royal Ranthambore Heritage Collection Whisky and Magic Moments Dazzle have been yielding encouraging responses. We are also working on scaling up the existing brands like Rampur Indian Single Malt, Jaisalmer Indian Craft Gin, 1965 Spirit Of Victory Rum, Morpheus Brandy, and 8 PM Premium Black Whisky. Going forward, you will see a host of products in the premium range from the House of Radico Khaitan.
With its premium products, Radico is focussing a lot on exports as well. But slowly these products are now available in India as well. What was the reason why this strategy was adopted? Was it to replicate the success that some of the other manufacturers have achieved using this route?
We had this strategy for two of our luxury products Rampur Indian Single Malt and Jaisalmer Indian Craft Gin and it worked wonders for us. Both the products are a rage world over. The primary reason was that the single malt and the craft gin categories were already established abroad. In India, these categories are now emerging. Hence, we launched the product first in the international market before bringing them to the domestic market.
What was your vision for the company a decade back and how has it changed considering where Radico is today?
My vision is to work constantly to improve quality standards and enhance customer satisfaction. And it has always been that. Be it last decade or two decades ago. I do not feel that we have to change it as it ultimately gets converted into revenue growth and increased market share. The Customer is the King for us.
The dynamics of the industry and also the way it operates is constantly changing. What are your thoughts on those? Is there anything that you would like to see differently about the industry or any suggestions you would like to make that can improve things?
Right from advertising to marketing, liquor industry operates in a very challenging business environment. For instance, alcohol companies are not allowed to advertise directly so we have to strategise differently to make our brands more visible, rope in more brand ambassadors, and create creative campaigns with infotainment. Since the market is also growing, we have to be on our toes to offer the best products to our consumers and devise marketing strategies that will ensure that our products reach them.
One of the major challenges that has emerged in the recent past is around our surrogate brands. According to the existing rules, companies need to have a separate revenue model for the surrogate brands with a certain amount of turnover and this creates an additional challenge for us.
However, we find solutions to all of these obstacles within the purview of law because we are a responsible company. We have a legacy to maintain. Non-compliance with state regulations is not an option for us. Since we have over 75 years of experience in liquor manufacturing and 25 years in the IMFL business, the company knows about the law across states and knows how to adhere to it.
In Abhishek, you have a son that has led from the front along with a great team. How does that make you feel as a father?
As I worked hard to help improvise and enhance my father’s vision, I am seeing the same zeal in him. He was instrumental in taking the call towards launching our own brands and premiumisation drive which turned the fortunes around for the company. He is a new-age leader who people look up to and that makes me an extremely proud father.
How difficult is it to compete against multinationals as an Indian brand? Your thoughts?
Once a company has a sound understanding of the market, and back that knowledge with its quality products then competition doesn’t pinch much – be it from domestic or multinational brands. Within two decades of launching our brands, we have expanded our reach to over 85 countries, which is an indication of the capability of Indian brands. I would like to give an example of our latest products Rampur Indian Single Malt and Jaisalmer Indian Craft Gin here; when we took the product to the international market, people were surprised by the fine quality leading to immediate acceptance. The idea behind giving this example was that once you have quality products according to the tastes of the people, competition becomes secondary.