The trend of consumers moving to premium alcohol products will further speed up leading domestic alcobev firms to come up with more such products, Prem Dewan, chairman and managing director of Jammu-based alcobev company DeVANS Modern Breweries, which is looking to aggressively expand its portfolio, said on Thursday.
“With a growth of 6-7% in the economy, I don’t think there is any chance of premiumisation slowing down,” Dewan told FE. “The move towards premiumisation is paying off. Consumers are shifting to premium products. Everybody seems to be upgrading,” he said.
“In fact what I would say is, this process [premiumisation] would speed up rather than slow down in future.”
The company, which makes the famous Godfather beer, is also planning a number of launches in 2025.
Dewan said that they will launch a premium gin and a herbal liquor – on lines of German digestif Jagermeister – in April; and two new premium expressions of its single malt GianChand and a vodka sometime later in the year.
Currently, the company sells beer under two brand names, Godfather and Six Fields. It is also planning to launch a new dark beer next year.
“I would say liquor or beer is an essential at the moment, it’s not luxury anymore,” he said.
DeVANS runs two independent breweries. One in Jammu’s Samba and another in Rajasthan’s Kotputli. It bottles its beer in five more breweries under tie-ups. These are located in Arunachal Pradesh’s Namsai, Jharkhand’s Bokaro, Uttar Pradesh’s Barabanki, Tamil Nadu’s Tiruvallur and Assam’s Sonitpur.
Last week, the company started selling its products in Maharashtra. “We are very confident that our beers will get excellent response in Maharashtra like other states,” Dewan said adding that if “everything goes well”, they may consider a tie-up there by March or April.
In 2024, the company is expecting a revenue of around Rs 1,500 crore, 60-70% higher than last year. This, Dewan said, is primarily due to the beer portfolio which is alone rising by 60%.
In 2025, the company is looking for a couple of more tie-ups, which may lead the company to grow by 30-40% next year.
“But even without any additional tie-ups we will probably end up with around 15-20%,” he added, without disclosing the net profit or loss figures.
In the past few months, alcobev majors in India have raised their concerns about the rise of grain prices, leading to a fall in their margins.
Dewan said that they do not use much grains in their current products, but for the upcoming products where they will use grains, the increased cost will be structured in the prices.
“We are not really worried about the grain cost at the moment,” he said.