Allied Blenders & Distillers (ABD), best-known for its Officer’s Choice liquor brand, is rapidly premiumising its portfolio, as Indian consumers opt for quality over quantity. The company, which sells close to 35-40 million cases annually, on Tuesday inaugurated a new PET bottle manufacturing facility at its integrated plant in Rangapur, Telangana. In an interview with Viveat Susan Pinto, Alok Gupta, MD, ABD, highlighted the significance of the move, investment into the project, the company’s festive outlook as well as its legal dispute with Tilaknagar Industries. Edited excerpts;
Alok Gupta on company plans
1) How will the PET bottle manufacturing facility help the company?
It will allow us to meet 70-75% of our captive requirements. With an annual capacity of 615 million bottles per annum, the facility, which has been built at an investment of Rs 115 crore, will lower logistics costs and enhance supply-chain efficiencies. It is also margin-accretive as we will reduce our reliance on external suppliers. We will make 90ml, 180ml, 375ml and 750ml PET bottles for Officer’s Choice. Over time, we will also do two-litre bottles of the brand, depending on demand and how the market evolves.
2) What are your capital expenditure (capex) plans for the current financial year?
Our investments are spread across Telangana and Maharashtra at the moment. The total capex announced is Rs 527 crore for FY26. This includes the PET facility, where the investment as stated earlier is Rs 115 crore; a single-malt distillery, which will come up by the fourth quarter of this fiscal at an investment of Rs 75 crore and an additional investment of Rs 337 crore to increase capacity at our Extra Neutral Alcohol (ENA) unit in Maharashtra. This plant was recently acquired by us and the distillery can currently produce around 11 million litres per annum (MLPA) of ENA, an additional 50 MLPA of ENA capacity is under approval. Together, these investments are expected to enhance operational efficiency and improve gross margins by 300 basis points by FY28.
Alok Gupta on GST cuts
3) With the festive season having begun against the backdrop of GST cuts, do you expect alcohol consumption to improve?
Premiumisation will likely accelerate in the December quarter due to festive consumption and higher disposable incomes from tax cuts. Consumers won’t drink more, but they may look to drink better. We have been gearing up to capitalise on this trend by building our prestige and above portfolio. A few years ago, we had no luxury brands, we now have six such brands including Arthaus scotch, Zoya and Pumori gin, Woodburns whisky, Segredo Aldeia Cafe and White Rums and Russian Standard vodka. We are adding three more to this portfolio including two more whiskeys and one white spirit. These will be launched during the festive season.
Alok Gupta on the launch of Indian single-malt whisky
4) Also, the launch of a single-malt distillery by the fourth quarter of this fiscal will mean that you will soon roll out an Indian single-malt whisky. Can you elaborate on these plans?
Yes. We will enter the high-growth market of Indian single-malt whiskeys. But it will not happen in this financial year. We are targeting the year 2029 for the launch. This is because it takes a minimum of three years for malt spirit to mature in wood before it qualifies as a whiskey, plus more time is needed for bottling quality. Having said that, we have begun the work for the launch in 2029. The single-malt distillery (at Telangana) will be among the first in India and will position us for entry into this segment.
5) What would be your next steps after the Supreme Court in an order dated September 16 rejected ABD’s appeal to launch Mansion House and Savoy Club brands in India? This has been a long-standing dispute with Tilaknagar Industries. Your thoughts.
The matter is sub-judice, so I am not in a position to comment about it. The court has directed resolution within six months. We believe we are rightful owners and will pursue due legal process.
(The writer was in Rangapur, Telangana at the invitation of ABD)