Bangalore: The India arm of Diageo Plc., the world’s largest liquor company, plans to launch three of its global brands in the country in the next four months, seeing demand in a market witnessing sluggish growth in most other sectors.
The company plans to import Ketel One vodka, Zacapa rum and Don Julio tequila into a market where nearly 190 million nine-litre cases of locally-made spirits are sold annually.
“We want to complete our premium portfolio,” said Asif Adil, managing director of the Mumbai-based Diageo India Pvt. Ltd which markets brands such as Johnnie Walker whisky, Smirnoff Vodka and Baileys liquor. Over the past two years, Diageo has launched in India several of its premium whisky, vodka and gin brands, as well as set up a retail chain, called Johnnie Walker Select outlets, in partnership with retail licence holders.
Adding variety : Over the past two years, Diageo has launched several of its premium brands in India.
The liquor company sees itself largely insulated from an economic slowdown because its sales volumes in India are not large. “...slowdown doesn’t impact me,” said Asif Adil. “I’m a small percentage of the total (market).”
A bulk of Diageo’s revenues comes from sales at duty-free outlets at airports and in larger cities such as Delhi and Mumbai, but the company is attempting to increase its presence in smaller towns which, have so far accounted for a minuscule share of revenues.
“These are going to be the vehicles of growth next year and the year after,” said Adil. “My strategy is going into tier II and tier III (cities) because I believe that’s where the opportunity lies, in addition to tier I.” The company also sees opportunity in Tamil Nadu where the government last month lifted restrictions on retail sales of imported liquor.
United Spirits Ltd, India’s largest liquor company by sales, recently acquired and integrated its contract manufacturer in the state, Balaji Distilleries Ltd, in a bid to consolidate the company’s advantage over rivals.
Asif Adil expects to also start bottling some of Diageo’s brands manufactured in India such as Smirnoff vodka and Masterstroke whisky in Tamil Nadu within the next six months at a new distillery being set up by a contract partner, whom he did not name.
“It’s a big opportunity. Tamil Nadu is one of the biggest markets for liquor,” he said. On 23rd October, Min t had reported that Diageo was in talks with the Vijay-Mallya led United Spirits Ltd, for a possible alliance in distribution and bottling.
United Spirits, meanwhile, has rolled out brands such as Jura Island Single Malt, The Dalmore Single Highland Malt and blended Scotch whiskies of Whyte and Mackay, the Scotch whisky company it acquired in May 2007.