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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
12-05-2025
- Business
- Time of India
Delhi beer crisis: Why Bhutanese and Nepalese beers are flooding the national capital
Delhi is in the midst of a beer crisis—and not the kind you'd want before a house party. According to a Times of India report, the capital is facing an acute shortage of popular beer brands, with government-owned retail stores and even bars and restaurants offering limited options. What's more noticeable, however, is the sudden abundance of beers from Bhutan and Nepal now occupying prime shelf space across the city. So, what's behind the foreign beer influx? Experts attribute this unusual trend to a mix of policy paralysis, brand pushing, and profit incentives. Since there's no import duty on Bhutanese and Nepalese beers , wholesalers enjoy higher margins and are more willing to promote these products—often offering incentives to liquor store staff to ensure better shelf placement. Vinod Giri, Director General of the Brewers Association of India (BAI), told TOI, "The challenge is mainly in government-run retail shops, where popular national brands are hard to find. Our market share estimates reveal that national companies and multinationals struggle to cope with current trade practices in these outlets." Consumers Turning to Spirits—or Haryana and UP With limited availability of trusted brands in Delhi, many consumers now travel to neighbouring states like Haryana and Uttar Pradesh to stock up or simply shift to spirits. Industry data shows that beer sales in Delhi dropped 37 per cent in FY 2023–24, while they rose nearly 10 per cent nationally. 'We've stopped experimenting with new beers here,' said Pratyush Ranjan, an IT professional from Dwarka. 'Instead, we go to Gurgaon, which isn't far, and buy the brands we know and love.' Numbers Tell the Story According to BAI data, Delhi stands out starkly when compared to other states. National beer brands make up 85 per cent of the market share across India, but in Delhi, they account for just 36 per cent . The remaining market is evenly split between regional brands and Bhutanese/Nepalese imports at 32 per cent each. A senior Delhi government official told TOI that the higher margins on duty-free imported beers make them more attractive to wholesalers and vendors. "These brands often get premium placement in chillers, giving consumers fewer chilled options from national brands,' the official said. The excise department is now studying the sale patterns and looking into issues like registration fees and brand margins.
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 !
Mint
26-04-2025
- Business
- Mint
Delhi's beer shelves are full—but where are the big brands?
Walk into a liquor store in Delhi this summer and you're more likely to spot Barahsinghe, Druk or Le Chilldoz than a chilled Kingfisher or Budweiser. Several well-known national and global beer brands have all but vanished from the city's shelves. In their place, lesser-known names—some locally made, others imported from Nepal and Bhutan—are rapidly gaining ground. This quiet transformation is puzzling consumers, squeezing out long-time market leaders, and sparking concern across India's beer industry. 'Most of the city now has lesser-known brands. Cheaper beer from Bhutan and Nepal is also entering the market, further crowding out familiar names," said Vinod Giri, director general of the Brewers Association of India (BAI), which represents firms like Heineken, AB InBev and United Breweries. Also by Varuni Khosla | Craft beer maker Bira in tax soup amid vendor payment and salary delays To be sure, Delhi's case is similar to that of states like Tamil Nadu, where government-run liquor stores dominate, distorting the market and pushing established beer brands to the sidelines. The disappearance of popular beer brands from Delhi's shelves is driven by three key factors: margins, market control, and policy paralysis. First, imported beer from Bhutan and Nepal—exempt from customs duties under Indian trade policy—is far cheaper for stores to stock. Delhi doesn't levy countervailing duties like most other states and even charges lower excise on these imports. The result? Bhutanese beers enjoy a ₹ 20 per bottle cost advantage, while retailers earn an additional ₹ 5 in margins—giving them a strong incentive to prioritise such products. Second, the number of liquor stores in Delhi has halved. The city now has just 380 state-run outlets, down from 565 before the 2022 policy reversal that shut private stores. With fewer vends and limited shelf space, smaller brands that offer higher margins are muscling out established names. Finally, there's been no coherent policy since 2022. The current excise regime is being run on ad hoc decisions, creating uncertainty, experts said. The roots of this distortion lie in Delhi's abrupt U-turn on alcohol retail policy. After briefly opening up liquor retail to private players under its 2021–22 excise policy, the Aam Aadmi Party (AAP) government scrapped the framework in mid-2022 amid allegations of corruption and a CBI probe. By September that year, the capital reverted to its old regime, with sales handled exclusively by four state-run corporations—Delhi State Industrial and Infrastructure Development Corporation (DSIIDC), Delhi Tourism and Transportation Development Corporation (DTTDC), Delhi State Civil Supplies Corporation (DSCSC), and Delhi Consumer's Cooperative Wholesale Store (DCCWS). Private players remain barred from operating retail outlets. Even after the Bharatiya Janata Party (BJP) assumed administrative control of Delhi, no new policy was introduced. The market has since been operating in a regulatory vacuum. Before the policy reversal in 2022, Delhi's beer market sold about 12.5 million cases annually. Kingfisher alone accounted for over 80% of those sales, according to BAI. Today, Kingfisher is barely visible in retail outlets. Read this | Kingfisher's big beer bet: flavoured brews According to data from the Delhi excise department, national beer brands grew just 11% between FY24 and the first half of FY25. In contrast, regional Indian brands surged 140%, while imports from Bhutan and Nepal shot up 217% (annualized). 'Brand pushing is a core issue with the Delhi market and Tamil Nadu where the states control the business of alcohol through their own entities," Giri of the Brewers Association of India said. Despite a projected rise in Delhi's overall beer market from 8.4 million cases in FY24 to 10.4 million in FY25, most of that growth is being captured by these lesser-known players. Compare that with national trends: across India, beer sales rose from 400 million cases in FY23 to 430 million in FY25. National brands still command an 86% share of the market, while regional and imported beers account for only 13% and 17%, respectively. Major names like Kingfisher, Budweiser, Heineken, and Carlsberg are largely missing from Delhi stores—though some show up in select bars or restaurants. Excise department records accessed by Mint show these being replaced by brands such as Arna, Miamy, Pazap, Serja, and Awitman. Mint contacted AB InBev and United Breweries for comment but did not receive a response by press time. Industry executives say that even when demand exists, government-run vends are simply not ordering their products. 'Sales are down to just 1–2% of what we saw in 2022," said the sales head of a leading beer company on condition of anonymity. 'The vends are either chasing higher margins or are incentivised in other ways. Either way, they're not stocking us." Read this | Beer brewers, after two tepid years, raise a toast to a longer, meaner summer Delhi residents are also adjusting. Many are now driving to nearby Gurgaon or Noida to stock up on their preferred brands. 'Since the policy changed over, I can seldom find any good beers in Delhi. Most of the time at the vends, there are unknown and unheard-of brands. Occasionally I find Bira or Corona cans, never a Kingfisher—but it's always a guessing game," said Dhruv Kapoor, 37, a corporate professional living in South Delhi and working in Gurugram. 'I, including a lot of people I know, am now picking up beer in cases from Gurgaon." Another 38-year-old South Delhi resident said she is only able to find Druk beer in nearby shops and nothing else—which has discouraged her from buying beer altogether. Delhi isn't the only market where beer shelves are being reshuffled. Tamil Nadu's state-run TASMAC stores also suffer from similar shortages of global brands, with only United Breweries managing to maintain a presence via a local franchise. Budweiser and Carlsberg are notably absent. 'Corporation-run markets like Delhi, Tamil Nadu, Kerala, Jharkhand, and Andhra Pradesh tend to distort the competitive field. Some like Andhra Pradesh and Jharkhand have reformed. Others haven't," Giri noted. Also read | Indian single malts keep up spirits despite Trump's tariff heat He added that India's major beer producers, including multinationals with massive local investments, are bearing the brunt. 'These firms follow strict quality controls and have built high-end breweries to support 'Make in India'," he said. "But the imported alternatives, often of questionable quality, face no such oversight. Industry insiders fear this disparity could eventually push more companies to relocate production to countries like Bhutan and Nepal."
