Radico's Royal Flush: ₹500 Crore Luxury Liquor Dream

Buoyed by the premiumization trend in the alcoholic beverage industry, Radico Khaitan anticipates its luxury brands—Rampur Indian Single Malt and Jaisalmer Indian Craft Gin—will generate ₹500 crore in sales by FY26, according to Managing Director Abhishek Khaitan.

For the next fiscal, the company forecasts 8-9% volume growth and 12-15% value growth. “This year has been strong, and we expect even better performance next year. Our Prestige & Above (PNA) category should grow over 15%, keeping us on track for double-digit expansion,” Khaitan told PTI.

Radico Khaitan’s luxury portfolio also includes Sangam World Malt and Spirit of Victory 1999 Pure Malt. In Q3 FY24, the company surpassed ₹100 crore in premium turnover, reaching ₹250 crore in the first nine months of the fiscal.

Looking ahead, Radico Khaitan plans to introduce two more luxury brands in the first half of the next fiscal. “We’ve been developing these for years, and they will soon enter the Indian market,” Khaitan said.

The company, which also owns premium brands like Royal Ranthambore, Dazzle Vodka, and Morpheus Blue, continues to experience strong double-digit growth. India’s rising per capita income and the annual addition of 20 million new legal drinkers are expected to sustain this momentum.

Despite India’s recent reduction of bourbon whiskey import duties to 50%, Khaitan remains optimistic about domestic players. “Bourbon’s market share in India is minimal and won’t pressure local brands,” he said. He also supports a phased reduction of the 150% duty on Scotch whisky under the India-UK Free Trade Agreement (FTA) to help Indian brands strengthen their position in the premium segment.

Radico Khaitan’s single malts are already outperforming imported competitors, with some priced even higher. Lower bulk whisky import duties could further reduce costs for Indian liquor manufacturers.

Radico Khaitan remains a key supplier to the Defense Ministry’s Canteen Stores Department (CSD), maintaining a 26-27% market share. “Indian brands enjoy strong demand, and consumers take pride in choosing them,” Khaitan noted.

In FY24, the company reported gross revenue of ₹15,483.9 crore, selling 45.6 million cases, with the PNA category contributing 11.26 million cases. Prestige & Above brands recorded a 20.3% YoY volume growth.

In Q3 FY24, net profit rose 27% to ₹95.48 crore, while revenue increased 8% to ₹4,440.90 crore. Prestige & Above brands accounted for 50.9% of IMFL volumes, growing 17.7% YoY.

With liquor retail policy changes in states like Uttar Pradesh and Andhra Pradesh expanding retail networks, Radico Khaitan anticipates further growth in the IMFL segment.

The company recently completed a ₹750 crore investment in a new greenfield distillery in Sitapur and expanded capacity at its Rampur facility. “Our major capex is complete, and we’ll now focus on routine maintenance,” Khaitan said.

Radico Khaitan also operates a distillery in Aurangabad, Maharashtra, with a total owned capacity of 320 million liters.

News by Rahul Yelligetti.