Liquor industry foresees slowdown in 2009

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Mumbai: The Indian liquor industry, which claimed to be insulated from the financial crunch, seems to have developed pessimism over their sales in the year 2009. Though companies are planning a number of launches in 2009, they are doubtful whether they can achieve as much sales in 2009 as they did in 2008 due to the global economic slowdown which has reflected in the sales of high-end spirits brands. A possible slowdown in premium brands sales and the consequent loss of higher margins is expected to hit companies’ revenues marginally in 2009.

Asif Adil, managing director, Diageo India, said, “The coming year will be more challenging, especially the first half of 2009. This situation will get mitigated in the second half of 2009 as the year-on-year comparisons will improve and markets will begin to look forward six months.” In 2008, Diageo has launched a number of brands from its global product portfolio such as Thomas Barton Reserve Wines, Tanqueray No TEN, and single malt brand Singleton of Glen’Ord.

Mahesh Madhavan, president & CEO, Bacardi Martini India Ltd, said, “Looking at the sentiments that most Indians carry as a result of the happenings in Mumbai and the global economic slowdown, there has been a certain level of reluctance from consumers against excessive indulgence. I do see this overall sentiment carrying forward for another 10 months before we see a change.”

Two months ago, Bacardi Martini India Ltd had launched Scotch whisky brands Dewar’s and Aberfeldy, priced upto Rs 22,000. “Having said that the top end brands will see a steady pace of sales, they may not see the double-digit growths that were taking place through most part of 2004- 2008. Consumers who have been buying high-end brands will continue to do so. We also see a shift of consumption from the fine dining and 5 star hotels to home and private get together,” Mahesh added. The sales of Scotch whisky was expected to reach at 12,03,000 cases in 2008 from 9,73,000 cases sold in 2007. Consumers who know these brands will carry them back on their travels abroad and hence we will see these brands holding their ground through 2009, although the heady growth rates may slow down next year, he concluded.