India’s beer sector ‘positive’ but climate and margin caution still evident
India’s beer industry has seen sales growing at almost double-digit rates over the past few months due to a series of reforms and good weather boosting trade. db reports.
Posting on social media yesterday, the Press Trust of India (PTI) revealed that between 2024-2025, United Breweries Ltd (UBL), which is part of global beer powerhouse Heineken, has contributed Rs 43,000 crore (£3.4 million) to India’s economy.
Growth and potential
While Heineken’s Kingfisher beer brand dominates the local market, Carlsberg and AB InBev are also major players within the sector and the market continues to see increased demand for premium drinks. Additionally, India’s craft beer sector has been forecast to reach US$1 billion by 2027 in what is being described as the market’s “growth phase”.
According to the PTI, a report from the Netherlands-based global impact and sustainability consultancy Steward Redqueen had also shown that UBL’s contribution includes a tax payment of Rs 30,600 crore (£2.4 million) across the value chain, which has assisted in “providing a stable revenue base supporting public finances” and added that this is equivalent to “1.3% of total state tax revenues” and “0.1% of the GDP”.
Speaking about the state of the beer sector across India, UBL managing director and CEO Vivek Gupta told the PTI at a local event that, despite the industry remaining under “severe cost pressure” and this impacting the bottom line (margins), he expects the category to recover and reiterated that the overall picture is “positive”.
Gupta said: “The trends in the beer category are positive, driven by good reforms in states like Karnataka and Maharashtra, and also by weather”.
The shape of things
Gupta added that the beer sector has been placed under pressures largely due to an unfavourable exchange rate weakening the rupee combined with the ongoing global conflict having a knock-on effect on the cost inflation placed on packaging and other imported ingredients and materials.
He explained: “Right now, there is a good positive top-line momentum. At the same time, there is work being done to recover the profit erosion that has happened because of the war impact,” but added that the beer sector in India is, otherwise, “in a good shape” and noted “we are seeing high single-digit volume growth, and of course some price-led growth as well, but primarily it is volume growth”.
Addressing the impact of changeable climate conditions affecting beer sales, Gupta also revealed the importance of the weather being steady and how this also assists in reliability economically as opposed to sudden fluctuations.
Gupta said: “We want to make sure the country gets the right monsoon, because for us it is more important to have a good economy with a right, balanced monsoon than having these spikes.”
All eyes on India
India has presented itself as a marketplace loaded with potential for drinks companies. IWSR data recently revealed that total beverage alcohol (TBA) volumes in India expanded at a combined annual growth rate of 3% between 2019 and 2024, capped by a 6% gain in 2024 and a 4% increase in 2025. Plus, growth is expected to continue with volumes predicted to rise at a CAGR of +3% between 2024 and 2034.
As such, two of the world’s biggest drinks groups – Pernod Ricard and Carlsberg are offering to sell minority parts of their Indian businesses on the local market while retaining overall control in an effort to unlock value from their Indian operations.
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