Premium beer up 38% as India’s drinkers split three ways

India’s alcoholic-beverage market is no longer moving as one block. September-quarter earnings from United Spirits, United Breweries, Radico Khaitan and Allied Blenders and Distillers point to a three-speed market: premium labels climbing fast, middle segments holding steady, and lower-income urban drinkers showing early signs of wallet fatigue.

Three consumer groups, three spending moods

United Spirits CEO Praveen Sameshwar told analysts the company sees three urban consumer bands: India 1, India 2 and India 3. India 1, the most price-sensitive end of its urban base, is showing fatigue. India 2 and India 3 remain resilient.

The company linked the softness to the prolonged West Asia crisis, weaker monsoons and inflation. Crucially, it did not quantify the decline or say whether these shoppers are buying less often, trading down to cheaper labels or choosing smaller packs. That makes this a sentiment signal, not yet a confirmed demand collapse.

Premium keeps climbing — but not only premium

The headline numbers are strong at the top of the pyramid:

• United Breweries: premium beer volumes up 38% year on year in the September quarter.
• Radico Khaitan: Prestige and Above volumes grew 36% year on year.
• Allied Blenders and Distillers: Mass Premium and Others rose 15.5%, outpacing its Prestige and Above growth of 6.1%.

That last line matters. Growth is not confined to expensive bottles; the mass-premium shelf is also doing work. A “premiumise everything” strategy would miss the resilient middle and the pressure at the bottom.

What brands are doing about it

United Spirits is working on a calibrated price and pack structure so each of its three consumer groups has a relevant entry point. In India, a shopper often decides by the rupee amount they are willing to spend on a single occasion, so pack size is as much a pricing tool as the sticker price.

It has also relaunched J&B Scotch as a 100% Scotch at an attractive price, enabled by the India-UK free trade agreement. On the format side, it is rolling out Smirnoff Ice ready-to-drink packs in Goa and Mumbai, with Bengaluru next, in 4.8% and 8% ABV variants. Radico has added Magic Moments Aam Panna to its flavoured vodka range.

What this means for your brand

The core lesson is segmentation, not just premiumisation. A useful frame is a price-pack ladder: keep a visible, affordable entry point for stressed consumers, a mid-tier that protects volume, and a premium tier that funds margin and brand elevation.

Inflation raises the stakes. Pushing prices up may protect margins but can push price-sensitive buyers away; holding prices steady can squeeze profitability. The brands that win will match the pack, price and occasion to each segment, then watch whether the fatigue stays local or spreads.

Source: Dailyhunt