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Time of India
2 days ago
- Business
- Time of India
No govt tax hike on beers a welcome sign: Brewers' body
Mumbai: The beer industry, which has been witnessing a consistent excise duty rise for a decade compared to IMFL, has welcomed the state's decision to spare beer of tax hike this time. Tired of too many ads? go ad free now The industry has always been pressing for a relatively more encouraging, liberal and competitive tax structure compared to IMFL, given the healthier nature of beer than the former's high spirit content. Vinod Giri, Director General, Brewers Association of India (BAI), said, "The taxes on beer are already very high in the state. In the last 10 odd years, excise duty on beer went up by 32% compared to just 9% on IMFL, leading to a strange situation where a bottle of beer is priced up to 50% more than the competing nips of IMFL. It's not surprising then that the beer industry turnover remained flat in the state over the last decade, whereas sectors like IMFL galloped at an average compounded growth rate of 7% year after year for 10 years. " It may be mentioned here that beer has far lesser pure spirit content than IMFLs. Tuesday's decision of the state cabinet to hike taxes on premium and smaller IMFL brands and country liquors, besides increasing permit room license fees, will come into effect only after 14-15 days after the final notification. — Chittaranjan Tembhekar
Time of India
22-05-2025
- Business
- Time of India
Price hike dampener? In peak summer, beer sales lose fizz in T
Hyderabad: The hike in beer prices appears to have taken the fizz out of its sales in Telangana. Since the price increase on Feb 11, beer sales have seen a dip in two consecutive months (March and April). Tired of too many ads? go ad free now Overall, sales have fallen by about 15% in the two months compared to the same period last year. The dip in April was 8%, with sales falling from 50 lakh cases last year to 46 lakh now. In March, the fall was even higher at 23%. Even the summer heat seems to have failed to spur beer lovers to spend extra buck on their favourite drink as most brands are now costlier by Rs 30-40. Rather, many have opted to buy Indian Made Foreign Liquor (IMFL) instead, spiking its sales in both April and March. In April, IMFL sales rose from 30 lakh cases last year to 32 lakh cases this year – an increase of over 6% in IMFL in the month when beer sales fell by 8%. A similar trajectory was seen in March too in IMFL and beer sales. While IMFL purchases increased by 39% (from 28 lakh cases to 39 lakh cases) in March, beer sales dipped by 23%. "I usually buy two premium beer brands, but after prices went up, I reduced my regular intake. Now, I sometimes buy IMFL to keep expenses in check in terms of my consumption," said C Chandrasekhar, a private employee. The state govt had allowed the Telangana State Beverages Corporation to increase beer prices by 15% after a request from the Brewers Association of India (BAI) and following a brief supply stoppage by United Breweries over prices and payment of dues. The hike was aimed at increasing revenue as Telangana is a major market for beer, but the fall in sales during peak summer could impact govt plans. Officials, however, said they were not relying on liquor sales alone to boost income and the fall in sales was a short-term phenomenon.
India Today
19-05-2025
- Business
- India Today
Why it's fewer cheers for beer in Karnataka
A revision in duty rates on alcoholic beverages in Karnataka took effect on May 15, hiking the additional excise duty (AED) on beer by 5 per cent while also tweaking rates on the lower priced categories of Indian-made liquor (IML), which includes spirits such as whiskey, rum and was the third increase in AED on beer since 2023 besides a separate hike in excise duty this companies say these duty increases in quick succession have put them in a quandary. 'The industry is in a dilemma about what to do— allow the market to shrink by retaining their margins or allow the market to grow but do away with their profitability,' says Vinod Giri, director general of the industry body Brewers Association of India (BAI).With the May 15 notification, AED on beer in Karnataka is currently at 200 per cent (calculated on the cost declared by the manufacturer), up from 175 per cent two years ago. Essentially, it will make retail prices of beer the highest in the southern region, adds July 2023, the AED on beer was increased from 175 per cent to 185 per cent. The following year, in February, it was revised to 195 per cent. Now, on May 15, the new AED rate of 200 per cent on beer became in January, the ED had been doubled from Rs 10 per bulk litre to Rs 20 on strong beer. Hence, with this notification, Karnataka now taxes beer in two slabs based on alcohol content—beers with 5 per cent alcohol and those with alcohol content of 5-8 per to Giri, the January-March quarter saw an 18 per cent dip in sales in Karnataka because of the excise duty hike. 'The industry has started shrinking in Karnataka after this January's increase in excise duty,' says Giri, whose organisation's founding members include companies such as United Breweries Ltd, AB InBev and Carlsberg, which together account for 85 per cent of beer sold in beer industry in Karnataka grew 46 per cent in 2022-23 and 14 per cent in 2023-24. However, in 2024-25, sales grew by 1 per cent, he beer sales in India were up 9.7 per cent in 2024-25, reaching a volume of 445 million cases. Karnataka is the second largest market for beer in the country, after Telangana, with about 55 million cases sold annually. It has 11 breweries, the most in India.A senior government official acknowledges that beer sales have taken a hit, but attributes it partly to a lag caused by a compliance change in which breweries in the state were mandated to declare ingredients, including the sugar content, on the pricing, the official points out that Karnataka leaves the declared price of an alcoholic beverage free for the manufacturer to decide, without a cap like in some other states. Owing to this, the declared prices of some beer brands tended to be higher in Karnataka than elsewhere, he says. The declared price is the basic price to which ED, AED, wholesale and retail margins are added to arrive at the maximum retail its large outlay on welfare schemes, Karnataka has been tapping several avenues to mop up revenue over the past two years. As part of this, it set out to restructure AED rates on alcoholic beverages. Out of Karnataka's 2024-25 budget projection of Rs 38,525 crore revenue from the excise department, the AED on hard liquor, or IML, was estimated at Rs 28,254 crore (73.34 per cent) while AED on beer was expected to net Rs 5,290 crore (13.73 per cent).As the government official explained it, prices of premium and super-premium IML brands were much higher in Karnataka compared to neighbouring states while it was the opposite in the case of bottom-rung brands. Hence, last year, the government lowered AED rates at the top-end in a bid to boost it has increased duty on the cheapest hard liquor brands to bring them on par. With the May 15 revision, the lowest three slabs will see an increase of Rs 15 per bottle while the fourth slab will go up by Rs 5. There are a total of 16 slabs for IML. 'There is good growth in the premium, especially super-premium IML segment,' says the official, adding that it will take at least a year to know if the policy has yielded the intended effect of netting higher to India Today Magazine
Time of India
11-05-2025
- Business
- Time of India
Behind beer bust: Why your favourite pint is missing from capital's shelves
New Delhi: With the mercury rising, the rush at liquor stores in the capital to buy chilled beer has started increasing, but customers often return disappointed due to the popular brands missing from the of some of the most consumed brands, what beer aficionados find at the city's govt-run liquor stores are some local brands as well as a few unknown labels from the neighbouring countries of Bhutan and Nepal. The situation is slightly better at hotels, clubs and restaurants, but customers complain that they often get very limited options to choose from, and the bar menus have longer lists of unknown brands than the ones that became popular over the a result, customers often rush to the neighbouring cities in Haryana and Uttar Pradesh to buy their stocks or switch to spirits. Data sourced from the industry revealed that beer sales fell by 37% in Delhi in the 2023-24 fiscal, whereas it grew by close to 10% in the rest of the country."Instead of trying a new brand every time, we prefer going to Gurgaon, which is only a few kilometres away, to buy beer whenever we have a party at home. We got used to the taste of some premium beer brands, which are never available in Delhi," said Pratyush Ranjan, an IT professional living in attribute this trend to brand pushing, higher profit margins on Bhutanese and Nepalese beers—since no import duty is levied on them—and policy paralysis. According to Vinod Giri, director general of Brewers Association of India, popular brands are available in some quantities in Delhi, primarily through on-trade, such as bars and restaurants, but are missing from the state-run retail liquor stores. "The challenge is mainly in govt-owned retail shops where popular national brands are hardly available. Our estimate on market shares tells a revealing story. National companies and multinationals are unable to cope with the trade practices at govt-owned outlets," Giri to the data shared by BAI, national brands dominate the market in most states except Delhi. In the capital, national brands comprise nearly 36% of the total sale, while regional and others (imported brands from Bhutan and Nepal) have an equal share of 32% each. In the rest of the country, national brands have a market share of a whopping 85%, followed by 14% of regional brands, while others sell just 1%.A senior Delhi govt official accepted that there were issues in the availability and sale of beer in the capital, and the excise department was trying to devise a strategy to overcome the problem. "Since there is no import duty on beer from the neighbouring countries, the margin or profit is much higher on them. The wholesalers, thus, don't hesitate to share a part of it with the staff of liquor vends to get more space on the shelves and chillers in the shops. Since customers want to buy 'chilled' beer, they don't have many options," said an official, requesting anonymity. "An analysis of the sale pattern in Delhi vis-à-vis other states is being conducted to understand what sells more. Also, the issue of the registration fee of brands and profit margin is being looked into," the official also said that the govt needed to find a way of bringing the pattern of corporations-run retail shops placing orders for the stock in line with the national market shares, especially with the neighbouring states of Haryana and UP. "The govt must re-introduce private vends in Delhi, which are more competitive and balance out some of the misplaced ordering patterns of state corporations. The number of shops also needs to be increased," Giri just the liquor shops, the non-availability of certain popular beer brands in the capital affects the entire supply chain and impacts the sale in hotels, bars and restaurants too. Operation Sindoor 'Our job is to hit target, not to count body bags': Air Marshal Bharti on Op Sindoor Precautionary blackout imposed across parts of Rajasthan, Punjab 'Indian Navy was in position to strike Karachi': Vice Admiral on Operation Sindoor Experts believe that many brands find it difficult to sustain only on the basis of sales in bars and restaurants. Zorawar Kalra, vice-president of National Restaurants Association of India, said certain nationally popular beer brands remain unavailable in Delhi's hotels, restaurants and clubs due to "distribution, regulatory and perhaps some licensing" challenges. "This can limit consumer choice and impacts establishments that wish to offer a broader, more diverse selection to guests. The NRAI has consistently engaged with the govt, seeking streamlined policies and wider brand access," Kalra said. "Dialogue remains ongoing, and we are very optimistic about collaborative solutions that balance regulatory priorities with industry needs, ultimately enhancing guest experience and supporting business growth," he added. Get the latest lifestyle updates on Times of India, along with Mother's Day wishes , messages , and quotes !
