By Karan Taurani and Nita Kapoor
In unrestricted consumer categories, marketing can help build the product. In restricted ones, the equation is reversed: the product, distribution, consumer affinity, and organisation must build the brand. Few markets demonstrate this better than Indian alcoholic beverages.
India is emerging as one of the most attractive alcobev markets. Yet, it remains one of the hardest markets to build a consumer brand in. India’s alcobev industry is estimated at Rs 5.3 lakh crore in FY26, with brown or dark spirits accounting for 65-70% of spirits volumes (approximately 440 million cases in FY26).
But the more interesting story is not volume. It is value. Across major global alcohol markets, consumption is under pressure as moderation, affordability, and changing consumer preferences reshape drinking behaviour. In 2025, beverage-alcohol volumes across leading markets declined around 2%. In India, beverage-alcohol volumes grew around 4% in 2025. The global industry’s growing challenge is creating value while people drink less. In India, the opportunity is to create value while the drinking-age population expands, category participation deepens, and consumers trade up. India adds 15-20 million consumers of legal drinking age every year. Increasingly, they appear willing to drink better, even if not proportionately more. This changes how we analyse the industry: Alcobev value creation equals volume multiplied by premiumisation, distribution, and brand power minus regulatory friction.
India has something most mature alcohol markets increasingly lack: demographics. A young population, rising disposable incomes, urbanisation, and relatively low per-capita consumption provide a long runway for growth. But volume is increasingly the floor of the investment thesis, not the ceiling. The question is shifting from how much more India will drink to what — and whether the dominance of brown spirits will make room for new niches and occasions.
Indeed, the next decade may not be about replacing whisky, but about multiplying occasions. Consumers are moving from mass towards prestige-and-above products, while Indian single malts, premium gin, tequila, craft products, and ready-to-drink are widening the repertoire. The winners will need a portfolio rather than a single-category strategy — developing products internally, making selective acquisitions, forming meaningful distribution tie-ups, collaborating with brands, and building presence across places of consumption. The future will be about creating more value per case. If industry volumes grow in mid-single digits while premium segments grow in double digits, earnings could compound materially faster than consumption.
India is not one alcohol market; it is several markets stitched together. Every state can have different excise structures, taxation, licensing, distribution systems, and retail formats. That complexity can become a formidable barrier to entry.
Presence in the right stores, premium outlets, bars, and restaurants determines discovery, trial, and adoption. In most consumer categories, distribution enables marketing. In alcobev, distribution itself is marketing. The shelf is also the billboard.
When conventional advertising is unavailable and surrogate advertising faces rising scrutiny, brands cannot simply buy attention. Product quality, packaging, innovation, retail visibility, on-premise experiences, bartender advocacy, and word-of-mouth have to work harder to create stronger brands. In alcobev, the moat is not just what sits inside the bottle. It is the organisation that gets the bottle into the right shelf, the right bar, and the consumer’s consideration set. Regulation reinforces the moat. Companies capable of navigating multiple state regimes and building brands without conventional advertising develop capabilities newcomers cannot easily recreate.
That leads to the central paradox: The less brands can rely on marketing, the better the underlying business has to become. The winning playbook is simple: Innovate harder. Listen deeper. Distribute smarter. Build in the dark. Because when attention cannot easily be bought, brands have to earn it.
The authors are Karan Taurani, EVP at Elara Capital, and Nita Kapoor, former CEO of the International Spirits and Wines Association of India.
Disclaimer: The views expressed are the author’s own and do not reflect the official policy or position of Financial Express.