India Alcohol Market Is Estimated To Witness High Growth Owing To Rise In Disposable Income
Alcohol refers to drinks with ethanol content consumed for recreational or ritual purposes. It is majorly categorized into beer, wine, and spirits. Beer dominates the Indian alcohol market owing to the popularity of beer among youth. It is consumed socially on occasions or casually with meals. Wine consumption is increasing but its market share remains low compared to other countries due to cultural preferences. Spirits, especially whisky, is consumed by older population for perceived health benefits. With rising disposable incomes, pub culture and social drinking habits are on rise in metropolitan cities, propelling the growth of the alcohol market in India.
The global India Alcohol Market is estimated to be valued at US$ 49580 Mn in 2023 and is expected to exhibit a CAGR of 6.7% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
Rise in disposable income is a key driver fueling the growth of India alcohol market. According to World Data Lab, average disposable income of Indians increased from INR 106,653 in 2015 to INR 142,910 in 2021. The swelling middle class tends to spend more on luxury and recreational activities such as social drinking at pubs and bars. This is increasing the consumption of beers and spirits in urban regions. Changing lifestyle and drinking habits of young population is another important factor spurring the market growth. Exposure to western culture and easy availability of various alcohol brands online is making alcoholic beverages more acceptable.
SWOT Analysis
Strength: The India alcohol market has a large consumer base due to its population of over 1.3 billion people. There is availability of raw materials like sugarcane, grains and fruits which are used in the production of alcoholic beverages. Rising disposable incomes have increased the spending power of consumers on premium brands of alcohol.
Weakness: Changing consumer preferences towards healthy beverages like fruit juices and herbal drinks are reducing the consumption of alcohol among younger generations. Strict government regulations regarding distribution and marketing of alcohol products limit the scope for promotional activities. High taxes imposed on alcoholic products increase their retail prices.
Opportunity: Introduction of new flavors, packaging styles and variants can attract new segments of consumers. Rising socializing trends and growth in organized retail have opened new sales channels for alcohol brands. Economic growth in rural areas is expanding the market reach and trial rates. Growing online retail is making alcohol available to consumers across all regions.
Threats: Increase in drunken driving accidents has led to greater enforcement of drink-and-drive laws which act as deterrent for alcohol usage. Rising health consciousness has made many consumers reduce or quit alcohol consumption due to obesity and lifestyle disease risks. Strong marketing of illicit Indian-made foreign liquor poses threat to the sale of legal products.
Key Takeaways
The Global India Alcohol Market Size is expected to witness high growth over the forecast period supported by rising working population, increasing socializing trends and economic development. The global India Alcohol Market is estimated to be valued at US$ 49580 Mn in 2023 and is expected to exhibit a CAGR of 6.7% over the forecast period 2023 to 2030.
Regional analysis indicates that southern states like Tamil Nadu, Karnataka and Andhra Pradesh dominate the India alcohol market due to preference for hard liquor and presence of key manufacturers. The consumption of alcohol is also increasing steadily in western states like Maharashtra, Goa and Gujarat resulting from changing social norms and travel & tourism activities.
Key players operating in the India alcohol market are DIC CORPORATION, Solvay S.A., Lion Idemitsu Composites Co., Ltd, Toray Industries, Inc., Tosoh Corporation, SK chemicals, Chengdu Letian Plastics Co., Ltd., Celanese Corporation, TEIJIN LIMITED, SABIC, Zhejiang NHU Co., Ltd., LG Chem, RTP Company, and Ensinger Polyplastics Co., Ltd. The India alcohol market comprises many small and unorganized domestic manufacturers along with major international brands.
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