Indian beer market bitter, but refreshing

While the entire world is currently trying to cope with Covid pandemic, India is beginning to limp back to normalcy. The bitter part for the alcobev industry could be over; the refreshing news is that growth will be back.

The global beer (breweries) market is expected to grow from $214.9 billion in 2019 to $216.5 billion in 2020 at a compound annual growth rate (CAGR) of 0.8%. The low growth is mainly due to economic slowdown across countries owing to the Covid-19 outbreak and the measures to contain it. The market is then expected to recover and grow at a CAGR of 5% from 2021 and reach $248.8 billion in 2023.

In the near future, India – which currently has more than 1.2 billion inhabitants – is foreseen to overtake China as the most highly populated country in the world.

UB Group continued to hold an outright lead in beer in 2019. The company was present with 23 of its own breweries and nine contract units spread throughout the country, enabling it to achieve a national distribution network.

In India, the treatment of excise duty in 2019 was decided by states which follow a policy where beer is taxed not on alcohol content but is determined by volume and price. As a result, beer is much less accessible to consumers than Indian Made Foreign Liquor (IMFL).

During 2019, industry players continued to investigate the huge opportunity for non-alcohol beer in India, especially in states such as Gujarat, Bihar, Nagaland and the union territory of Lakshadweep, where consumers do not have access to alcohol. Such products not only target Indians who do not consume alcohol or have no access to it, but also provide existing consumers with an additional lighter option.

Covid-19 Impact