Premiumisation lifts liquor companies' June quarter topline amid cost headwinds

New Delhi: Premiumisation emerged as the key growth driver for India's alcoholic beverages industry in the first quarter of 2026-27, helping major spirit makers expand revenue and protect margins even as several players saw profitability squeezed by elevated input costs and policy changes in some states weighed on performance.

Leading alcobev (alcoholic beverage) players, such as United Spirits Ltd (USL), Radico Khaitan and Allied Blenders and Distillers Ltd (ABDL), reported a high double-digit growth of 10 to 36 per cent in their prestige-and-above (P&A) segment, which is higher-end, premium, luxury spirits including whiskey, vodka, gin, and rum.

United Breweries Ltd (UBL), the country's largest beer maker, also reported an increase of 17 per cent in its premium volume, from its brands such as Kingfisher Ultra, Ultra Max, Heineken, and Amstel Grande.


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Home-grown liquor major Radico Khaitan reported its "highest ever volume, top line, profitability", with consolidated net profit rising 76 per cent to Rs 229.60 crore and revenue increasing 13.22 per cent to Rs 5,867.69 crore.

Volume of its P&A brands, including Rampur Single Malt Whisky, Jaisalmer Indian Craft Gin, Morpheus Brandy, Royal Ranthambore and 8PM Premium Black, rose 35.8 per cent to 5.22 million cases.

"Our performance was driven by the continued success of our premiumisation strategy with our P&A portfolio delivering 36 per cent volume growth during the quarter and significantly outpacing the industry," Managing Director Abhishek Khaitan said during an investors' call.

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He expects the P&A portfolio to deliver over 25 per cent volume growth during FY27 and sustain an EBITDA margin of around 20 per cent.

Diageo-controlled USL, which owns brands, including Johnnie Walker, Black Dog, Black & White, VAT 69, Singleton, Smirnoff and Tanqueray, reported a 51.6 per cent rise in net profit to Rs 391 crore, supported by the P&A segment.

Excluding Maharashtra, "our P&A volume has grown by 6.4 per cent. On NSV growth, based on the same construct against the reported P&A growth of 10.1 per cent, eliminating Maharashtra, we have grown 14.8 per cent," said its Managing Director and CEO Praveen Someshwar in a investors' call.

Revenue from operations rose 5 per cent to Rs 6,113 crore in the June quarter. NSV (net sales volume) from the popular segment, which contributes less than 10 per cent of revenue, fell 17.5 per cent to Rs 206 crore.

P&A typically refers to brands retailing at roughly Rs 700-800 and above per 750-ml bottle, depending on the state and tax structure. It is having strong momentum, reflecting the ongoing premiumisation of the Indian alco-beverage market, supported by rising disposable incomes, evolving consumer preferences, and increasing demand for premium spirits.

ABDL, maker of Officer's Choice Whisky, posted an 18.65 per cent decline in consolidated net profit to Rs 45.42 crore, while revenue from operations rose 5.8 per cent to Rs 984 crore. Its P&A segment accounted for 59.3 per cent of sales value, up from 55.8 per cent a year ago, while gross margin expanded 277 basis points to 46 per cent.

Managing Director Amar Sinha said global supply chain disruptions had a short-term impact during the quarter, but the company remained focused on premiumisation and backward integration projects.

Its premiumisation drive remains the key growth lever going forward as it reported a 5.8 per cent year-on-year rise in its income from operations to Rs 984 crore in the June quarter on volumes of 9 million cases (9 litres each), up 6.2 per cent.

UBL reported a contrasting trend, with consolidated net profit declining 9.64 per cent to Rs 166.28 crore due to higher expenses and the West Asia conflict, even as its revenue rose 10 per cent to Rs 5,919.44 crore.

The company said premium volumes increased 17 per cent, excluding two states where it took steps to mitigate the war impact, led by Heineken Silver and Kingfisher Ultra.

"Premium margins have become accretive for the first time in the past quarter," UBL CFO Jorn Kersten said, adding that the premium portfolio would become a meaningful contributor to profitability going forward.

Tilaknagar Industries Ltd posted the sharpest revenue growth among peers, with consolidated revenue surging 165.4 per cent to Rs 2,252.42 crore, aided by the integration of the Imperial Blue whisky business acquired from Pernod Ricard India. However, profit after tax fell 64.3 per cent to Rs 31.59 crore due to integration-related exceptional costs.

Wine maker Sula Vineyards Ltd reported a return to revenue growth, with net revenue from operations rising 3 per cent year-on-year to Rs 112.9 crore.

"Growth in Own Brands was driven by strong traction in our Elite & Premium portfolio, with our Elite flagship brands, The Source and Rāsā, delivering robust double-digit growth," said Sula Vineyards CEO Rajeev Samant.