ABD, the maker of Officer’s Choice whisky, is targeting an even split between premium and mass-market brands in terms of volume sales over the next two years, managing director Alok Gupta said in an interaction with FE, as the company doubles down on India’s fast-growing premium liquor segment.
The company has expanded its premium portfolio over the last few months, adding two new whiskies and a vodka in FY26, taking its prestige and above (P&A) portfolio to nine brands. Currently, the P&A segment contributes 47% in terms of volumes and 55% in value sales, while the remaining 53% of volumes come from the mass segment led by Officer’s Choice.
“The premium portfolio continues to track well as consumers continue to make discerning choices,” Gupta said, adding that the value contribution from premium brands could rise to 70% over two years from 55% now.
Broader shift in the alco-bev industry
The strategy comes amid a broader shift in the alco-bev industry where value growth is outpacing volume growth. Gupta said the super-premium and luxury segment, though just about 3% of the 420-million-case Indian-made foreign liquor (IMFL) market, contributes nearly 20% of industry profits and continues to grow in high double digits.
The premium push helped ABD post its highest-ever quarterly earnings before interest tax depreciation and amortisation (Ebitda) in the March quarter at Rs 182 crore, up 21.2% versus last year, with margins expanding 179 basis points to 17.9% in the quarter. However, Q4 net profit fell 52.1% year-on-year to Rs 38 crore from Rs 79 crore, weighed down by a Rs 45.45 crore one-time tax charge relating to earlier years.
For FY26, Ebitda rose 25.8% year-on-year to Rs 568 crore. Revenue grew 11.5% on-year in FY26 to Rs 3,949 crore and 9.1% year-on-year in Q4 to Rs 1,020 crore.
The company’s premium and above portfolio grew more than 20% in Q4, while the mass segment held steady (in Q4) after facing pressure in the previous quarter.
However, the company cautioned that rising crude-linked inflation and packaging costs could weigh on margins in the near term. Packaging costs, including PET and glass bottles, account for roughly 30% of manufacturing costs. Gupta said if geopolitical tensions in West Asia ease over the next few months, the industry should be able to maintain margins in FY27. But a prolonged conflict and elevated oil prices could result in a 200-250 basis point hit to profitability.
To offset inflationary pressures, ABD has taken selective price hikes across several markets and is awaiting approval for revisions in Telangana, one of its key states. The company said most hikes are in the range of about 2%.