Beer makers Mint spoke with, including Kingfisher maker United Breweries, Budweiser producer AB InBev, and boutique players expect a 7-10% growth in business this summer—if supplies aren’t disrupted by state excise policies.
“From a demand standpoint, we don’t see any problem in terms of what to expect from this summer. We are seeing a gradual increase in our demand,” said Vivek Gupta, managing director and chief executive of United Breweries, “but we are concerned about some states increasing duties…”
Summer is a crucial season for beer companies as chilled cans or bottles of the beverage offer more than just respite from the heat. But while the summer of 2023 welcomed unexpected rain in several parts of the country, in 2024, alcohol consumption was barred in states during the Lok Sabha election that ran from April to June.
The Indian Meteorological Department has forecast above-normal heatwave conditions in several parts of the country this summer after the country recorded warmer-than-usual temperatures in February.
United Breweries’ management said during their third-quarter earnings call last month that the company had already started ramping up its inventory for the summer with February turning out to be warmer than usual in many parts of the country.
Belgium-headquartered Ab InBev is already seeing demand pick up for its Budweiser and other beer brands in Maharashtra, Karnataka, Uttar Pradesh, Telangana, West Bengal and Goa, according to information the company shared with Mint.
About 80% of beer sales by volume in India is dominated by Dutch brewer Heineken, AB InBev, and Carlsberg (in no particular order), according to international drinks consultancy IWSR.
Industry body Brewers Association of India expects 430 million cases of beer to be sold in the country in 2024-25, up from about 410 million cases in FY24 and 400 million in FY23.
Also read | Can a scorching summer thaw India’s consumption slowdown?
Regulatory hiccups: An annual affair
As April approaches, beer makers will be tracking the annual transitions of state excise policies, which could force the companies to re-label and re-register their brands.
This could introduce significant logistical challenges to beer makers as they wait for their new labels to start production, potentially causing supply chain disruptions, said industry experts.
Several states in India follow an April-March excise year, requiring beer makers to renew licences and approvals at the beginning of their peak summer season. Telangana and Andhra Pradesh, however, follow an October-September excise year.
New state regulations, licensing procedures, and distribution networks usually disrupt supply chains and lead to temporary shortages across regions, said Vinod Giri, director general of Brewers Association of India.
“In the three months starting this April demand is expected to far outstrip supply. But it remains to be seen how much companies can actually supply,” said Giri. “Despite the robust demand in most parts of the country, which should otherwise be a very healthy indicator of the sector’s growth, because of supply side issues there’s no clarity on how the industry will grow this year.”
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Delays by state governments in renewing approvals or issuing new licenses not only creates uncertainty for beer suppliers but also prevents them from taking up pre-production activity in January and February when demand is relatively less, Giri said.
“A lot of time is spent on label renewals and registrations. In some states, we have been waiting as long as 8-10 months,” said Shantanu Upadhyay, co-founder of Kati Patang, which expects to cross 150,000 beer case volumes in 2024-25 and double it the next financial year. “Since we are still scaling up this year, we do expect that if policies and paperwork go in our favour, we should be able to grow 3-4x over last year.”
State governments need to review archaic manufacturing rules and adopt new global practices, added Giri.
For instance, many countries allow high-gravity brewing, which gives companies flexibility to scale their production up or down from within the same facility. “However, with the exception of some states, most others have not yet amended their laws to allow such technological improvements,” Giri said.
Also read | Kingfisher’s big beer bet: flavoured brews
A summer’s boost for small beer makers
India’s upcoming harsh summer, meanwhile, has even small and boutique beer makers optimistic about faster growth in FY26.
New-Delhi based beer makers Kati Patang Lifestyle Ltd and Medusa Beverages Pvt. Ltd are expecting at least a 10% growth in sales this summer (April-June), according to their executives.
Medusa, which is targeting sales of 2.5 million cases in the next financial year (2025-26), expects to sell 32-36% of that number, or 800,000-900,000 cases, in the first quarter (April-June) itself.
SOM Distilleries and Breweries Ltd, brewer of the Hunter beer brand, and Godfather maker DeVANS Modern Breweries Ltd have greater ambitions for the upcoming financial year.
Diwakaran Suryanarayana, chief operating officer of SOM Distilleries, said while the company’s sales expanded at a compound annual growth rate of 25% the previous 3-4 years, he expects a similar increase this year propelled by a longer and warmer summer.
However, in Karnataka and Telangana, which last month increased the retail prices of beer by 45% and 15%, respectively, Suryanarayana sees a 7-10% drop in beer sales.
For DeVANS, demand is already looking strong for March-June, according to the company.
“We are expecting to grow 50% in the summer quarter,” said chairman and managing director Prem Dewan. “We should also be able to manage our capacity to sidestep any disruptions in the states where policies are changing over. We have increased our tie-ups and added various states to our sales.”
