Alcohol market will be led by India, China: Pernod chief Alexandre Ricard

Alexandre Ricard, chairman of Pernod Ricard, said most alco-bev industry growth in the next decade will be driven by India and China, where the world's second-biggest spirits group already has a strong leadership position.

In India, the maker of Absolut vodka and Chivas Regal scotch, sold spirits worth ₹4.1 billion in 2021, expanding sales by 25% from the year ago.

"We have roughly 45% of the market in which we operate in India. The legal drinking age population is growing on average by 20 million people a year with good GDP growth and strong urbanisation rates, which is the perfect cocktail for our spirits category," Ricard told investors at the Capital Market Day.

While India has a population of nearly 1.2 billion, the drinking population is considerably smaller and nearly half can only afford very cheap unbranded liquor. The rapidly growing middle class, who can afford premium-and-above, is estimated to be about 150 million.

Pernod gets a significant chunk from premium and semi-premium brands, mainly Blenders Pride, Royal Stag and Imperial Blue. The French company controls about a fourth of the overall whiskey market in India despite its miniscule presence in the mass segment. The company said it has reached an inflection point in India with sales of international brands growing 58%, while Seagram's whiskey portfolio expanded by 22%.

"International brands business growth is booming in India, on the penetration and the rising young middle-class, affluent consumers. The kind of growth that India is seeing for international brands, it has never ever been seen before," said Rajesh Mishra, chief operating officer, Pernod Ricard India.

Last calendar year, sales of beer and spirits such as whisky, vodka and gin expanded 17-18% by volume, its fastest expansion in more than a decade due to a low base and increased in-home consumption, according to the latest data by IWSR Drinks Market Analysis.