Indian Alcohol Market to Reach USD 68.75 Billion by 2032,Growing at 5.8% CAGR Due to Rising Income & Changing Lifestyles

Rising disposable incomes, changing social norms, and increased urbanization are driving the growth of the Indian alcohol market.

TOKYO, TOKYO, JAPAN, January 28, 2025 /EINPresswire.com/ -- Indian alcohol market was valued at around USD 39.30 billion in 2024. It is expected to grow from USD 41.56 billion in 2025 to approximately USD 68.75 billion by 2034, reflecting a compound annual growth rate (CAGR) of 5.8% over the forecast period from 2025 to 2034.

The Indian alcoholic beverage market is rapidly evolving, with new consumption trends, evolving consumer preferences, and innovative product offerings driving growth. As the demand for alcoholic beverages continues to rise across different consumer demographics and consumption channels, the industry has witnessed significant transformation in recent years. This press release presents a detailed analysis of the Indian alcohol market, including beverage types (Beer, Wine, Spirits, Ready-to-Drink (RTD) beverages), packaging formats (Bottles, Cans, Kegs, Cartons), consumption channels (On-Trade vs. Off-Trade), target audience groups, and distribution channels.

Key Players

Diageo Plc, AB InBev, Asahi India Glass, Tilaknagar Industries, Monteith's, Meantime, Tui, United Spirits Limited, Carlsberg Indi, Radico Khaitan, Woodforde's, Allied Blenders Distillers, Innis Gunn, Pernod Ricard, Heineken

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Market Overview: Rapid Growth and Shifting Preferences

India’s alcohol market is one of the largest and fastest-growing globally, driven by rising disposable incomes, urbanization, changing lifestyles, and shifting attitudes towards alcohol consumption. According to industry experts, the country’s alcohol consumption is expected to increase significantly over the next decade, fueled by growing demand across diverse segments of the population.

The alcohol industry in India can be segmented based on several factors, including the type of alcoholic beverage consumed, packaging types, consumption channels, target demographics, and distribution methods. Let’s take a closer look at these segments, which are helping shape the market’s current and future landscape.

Alcoholic Beverage Types

Beer: Traditionally one of the most popular alcoholic beverages in India, beer has witnessed a significant transformation, with premium and craft beer gaining popularity, especially in urban areas. Millennials and younger consumers are particularly drawn to craft beer and international beer brands, seeking unique tastes and experiences. With the increase in beer bars, restaurants, and social clubs, beer consumption is likely to remain a major growth driver in the Indian alcohol market.

Wine: India’s wine market, while still in a nascent stage compared to beer and spirits, is showing promise, especially among urban dwellers. Increasing wine production in domestic wineries, along with the rising interest in international wines, has fueled this sector's growth. Wine consumption is often associated with a more sophisticated and upscale lifestyle, making it particularly popular among young professionals and those in higher income brackets.

Spirits: The spirits segment in India continues to dominate the market, with whisky leading the charge as the most popular alcoholic drink. Indian-made foreign liquor (IMFL), along with global premium whisky brands, enjoys widespread consumption. Additionally, vodka, rum, and gin are also growing in popularity, particularly among the younger generation. The consumption of spirits is expected to grow in both urban and rural areas, driven by increasing disposable incomes and rising alcohol availability.

Ready-to-Drink (RTD) Beverages: RTD beverages, which include pre-mixed cocktails and canned drinks, have seen a surge in popularity in recent years, particularly in urban markets. These beverages cater to the convenience-seeking consumer who prefers quick, easy-to-consume alcohol options. RTDs are especially popular in bars, parties, and social gatherings, where their ease of use and diverse flavor profiles appeal to a wide range of consumers.

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Market Segmentation by Pack Type

Alcoholic beverages are available in various packaging formats, including bottles, cans, kegs, and cartons. Each packaging type is tailored to a specific consumer preference and consumption occasion.

Bottles: Bottle packaging remains the most widely used for spirits, wine, and premium beer. The demand for glass bottles has been growing, as they offer better preservation of product quality. Bottled beverages are often associated with higher-end products, particularly in the spirits category.

Cans: Cans are increasingly becoming popular, especially for beer, RTD beverages, and carbonated alcoholic drinks. The convenience and portability of cans make them the preferred choice for younger, on-the-go consumers. Cans are also more environmentally friendly, with manufacturers increasingly turning to recyclable materials.

Kegs: Kegs are predominantly used in the on-trade segment, especially in bars, restaurants, and pubs. They offer the advantage of larger quantities, making them ideal for social drinking. The demand for kegs is driven by the increasing popularity of beer and RTD beverages in on-trade consumption.

Cartons: Cartons are primarily used for wine packaging, providing an affordable option for consumers who prefer larger quantities. They are also a more sustainable option compared to glass bottles and are expected to gain further traction in the coming years.

Consumption Channels: On-Trade vs. Off-Trade

The alcohol market in India can be further divided into on-trade and off-trade consumption channels. On-trade refers to alcohol consumed at bars, restaurants, pubs, and clubs, while off-trade represents alcohol bought from retail stores, supermarkets, and e-commerce platforms.

On-Trade: On-trade consumption remains a dominant channel, with young adults and professionals flocking to bars and pubs for social gatherings. In urban centers like Mumbai, Delhi, and Bangalore, the demand for premium alcoholic beverages in on-trade venues is growing steadily. Bars and restaurants that offer a variety of drinks, including craft beers, wines, and cocktails, are capitalizing on this demand.

Off-Trade: Off-trade consumption, which accounts for a significant share of the market, is driven by the growth of retail outlets, supermarkets, and convenience stores offering alcohol. This channel provides consumers with the convenience of purchasing their favorite alcoholic beverages for home consumption. In rural areas, off-trade sales are primarily driven by traditional wholesalers and mom-and-pop stores.

Target Audience Segments

The alcohol market in India caters to several distinct target audiences, each with different consumption patterns, preferences, and purchasing behavior.

Youth (18-30 years): This demographic represents a significant portion of the alcohol-consuming population in India. Young adults are increasingly exploring premium alcoholic beverages and international brands, with beer and RTDs being the preferred options. Social media and influencer culture are playing a key role in shaping the preferences of this group.

Adults (30-55 years): Adults in this age group tend to prefer traditional alcoholic beverages like whisky, rum, and wine. They are more likely to engage in moderate alcohol consumption, with a preference for premium and well-aged spirits. The demand for fine wines and upscale bars is rising among this segment, which is often more brand-conscious and quality-driven.

Seniors (55+ years): While older consumers typically exhibit lower alcohol consumption levels, this demographic still forms a crucial part of the alcohol market, particularly in the spirits and wine segments. Whisky and rum are popular choices, while wine consumption is steadily rising among older consumers who associate wine with health benefits and sophistication.

Indians Abroad: The Indian diaspora across the globe, particularly in markets like the US, UK, and the Middle East, has also contributed significantly to the growth of India’s alcohol export market. Expatriates tend to favor familiar domestic brands, with Indian-made whiskies being especially popular in international markets.

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Distribution Channels: Traditional vs. Modern Trade

The distribution of alcoholic beverages in India can be categorized into traditional distribution, modern trade, e-commerce, and direct-to-consumer (D2C) channels.

Traditional Distribution: Traditional distribution channels, including wholesalers and local retailers, continue to dominate the alcohol market in India, particularly in rural and semi-urban areas. These channels are deeply ingrained in the market, with relationships spanning decades.

Modern Trade: Modern trade, consisting of hypermarkets, supermarkets, and large retail chains, is seeing rapid growth in India. As disposable incomes rise and the urban middle class expands, these channels are becoming increasingly important for premium alcoholic brands.

E-commerce Platforms: The rise of e-commerce platforms has revolutionized the alcohol market, especially in states where online alcohol sales are permitted. Online platforms allow consumers to conveniently browse and purchase alcohol, offering a wider variety of choices, discounts, and home delivery options.

Direct-to-Consumer (D2C): The D2C model is gaining popularity, particularly for premium products. Direct sales through brand websites, subscription services, and customized alcohol boxes have attracted growing interest among consumers who prefer personalized experiences.

Industry Development, Drivers, and Challenges

Market Drivers:

Rising disposable incomes and urbanization.
The increasing popularity of premium, craft, and international alcoholic brands.
Changing consumer preferences, with younger audiences favoring innovative and ready-to-drink products.
Growth of e-commerce and modern trade channels, providing more access to consumers.
Challenges:

Regulatory hurdles and complex taxation policies on alcohol sales.
Cultural and regional differences in alcohol consumption patterns.
The need for effective strategies to combat health concerns related to excessive alcohol consumption.
The Indian alcohol market is expected to continue its growth trajectory as more consumers embrace new products, experiences, and convenience. However, the industry must navigate regulatory challenges, competition, and shifting preferences to remain competitive and meet the evolving demands of the modern consumer.

TABLE OF CONTENTS:

1 EXECUTIVE SUMMARY
2 MARKET INTRODUCTION
3 RESEARCH METHODOLOGY
4 MARKET DYNAMICS
5 MARKET FACTOR ANALYSIS
6 INDIAN ALCOHOL MARKET, BY FORM
7 INDIAN ALCOHOL MARKET, BY CATEGORY
8 INDIAN ALCOHOL MARKET, BY APPLICATION
9 INDIAN ALCOHOL, BY REGION
10 COMPETITIVE LANDSCAPE

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