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Sun, sand and Goa’s exploding gin industry

Clockwise from top left: Matinee Gin founders Anjali Shahi (left) and Lavanya Jayashankar; Tāmras founders Devika Bhagat and Khalil Bachooali; Stranger & Sons founders Sakshi Saigal, Vidur Gupta and Rahul Mehra.Premium
Clockwise from top left: Matinee Gin founders Anjali Shahi (left) and Lavanya Jayashankar; Tāmras founders Devika Bhagat and Khalil Bachooali; Stranger & Sons founders Sakshi Saigal, Vidur Gupta and Rahul Mehra.

  • Goa is seeing an explosion of homegrown gin brands. But is there profit at the end of the party?
  • Analysts fear that the market isn’t big enough for so many players. Smaller to mid-size gin companies will need to scale up. But there’s room to grow—if they look at non-metros.

PANAJI : Anyone visiting Mumbai’s Mahalakshmi Race Course on the first weekend of May could be forgiven for thinking they had walked into a concert. There was the usual music, food, and shopping but with one exception: the alcohol was only gin. The Gin Explorers Club, a festival that raises a toast to gin, saw the participation of homegrown brands: Doja, Greater Than, Jaisalmer, Samsara, Stranger & Sons, Tāmras and Terai. “It was a well-curated event. These brands had their own identity in terms of décor, design, and cocktails and the way they presented the gins (some gave out gin popsicles)," says Richa Thakur, independent brand marketing consultant.

If the hype is to be believed, we just can’t have enough of gin.

There are new brands coming up like clockwork—the latest is Satiwa in Goa, which features organic hemp. Gin companies are getting funded; there are exclusive gin events, tasting menus, and festivals—including an upcoming one in Goa called GinTo, and it’s a rare event (especially in Goa) that doesn’t feature the spirit in some form. To supplement this growth are new homegrown tonics, ginger ale and mixers and even ready-to-drink gin and tonic products.

True, gin has a tiny share (0.4%) in the total spirits volume in India. But it’s a market that is growing.

The total gin volume in India grew by almost 47% in 2021 (after a decline of 54% in 2020), says IWSR Drinks Market Analysis, a firm that focusses on the global alcohol market. It forecasts that the volume will grow at 9.8% compound annual growth rate (CAGR) from 2022 to 2026.

The luxury gin segment is expected to grow at 6.2% CAGR owing to increasing consumer standards, according to Allied Market Research, which projects that the Indian gin market will reach $1,598.2 million by 2030.

The rise of gin has been called everything from the ginaissance to the gin revolution. But what is the future of gin-makers in an already crowded market?

The Goan story

India’s gin revival has its roots in Goa.

Anand Virmani and Vaibhav Singh of Nao Spirits wanted to prove that quality gin could be made in India. In 2017, they launched a London dry gin, Greater Than, and followed it up a year later with Hapusa, a Himalayan dry gin. They chose Goa because the drinking culture was tolerant, they had a good manufacturing partner, and it gave them an excuse to travel to Goa for work. “Goa today is a fantastic market. You have the best in terms of brands, experiences, bars and restaurants. It is the place to establish your brand," says Virmani.

Suddenly, Goa became the focus of India’s new gin chapter.

Goa offers a lot for anyone keen on creating their own alcohol: friendly excise policies—it has the lowest liquor tax rate in the country—existing distilleries and bottling units; a developing and experimental consumer market; a blossoming hospitality industry; no taboo on liquor consumption; spice farms that supply quality botanicals, good quality of water, and, of course, a good quality of life for founders. In addition, the last few years have seen exclusive gin bars in the state, from Verandah in Morjim to the Sylvia Bar at the W Goa in Vagator, which offers a five-course gin cocktail menu.

At the last count, there are 15 gins being made in the state: Greater Than, Hapusa, Stranger & Sons, Tāmras, Matinee, Doja, Samsara, Jin Jiji, Pumori, Gin Gin, Clearly Good; the made-by-Goan gins being Seqér, Tickle, Black Jewel and Cape Town. These gins use locally sourced botanicals (some from farms in Goa), their price points (starting at 245 and going up to 3,000) cater to different groups, they come in carefully designed bottles, and they all want to tell a story.

Shubham Khanna’s story began with making his own pot still, which he moved from Delhi to Goa. The self-taught gin-maker researched gin for six years, experimenting with ingredients (including Maggi masala) before releasing ‘the most affordable gin in the market’, Clearly Good ( 245 for 350 ml), in 2020. “At that price point, people don’t expect quality spirit. I wanted to change that mindset," says Khanna. Clearly Good has butterfly pea flower as one of its botanicals. Last year saw the launch of Gin Gin, which uses hemp.

At the Fullarton Distillery in Khandepar, Aman Thadani also created his own pot still. He was inspired to do so after visiting micro-distilleries in Europe and UK and seeing how they stayed true to the small-batch craft culture. The New Western style gin, Pumori, came out in 2020 and Thadani is now working on designing a bigger stainless steel and copper still.

As with Fullarton, there are a few other companies who decided to throw their hat in the gin-soaked ring. In 2018, from the Madame Rosa (known for its feni) stable came Black Jewel gin. In the lockdown, Spirit de Goa distillery launched Seqér. In 2020, Adinco Distilleries—the makers of Cabo coconut rum—launched Tickle gin. Tickle is a cold compound gin —this process mixes extracts of the botanicals with base spirits and doesn’t involve distillation.

Making gin sounds quite doable on paper; some jokingly call it vodka with flavourings. “Gin is a fairly simple spirit to make: you need a good neutral base spirit, good pot still, and decent botanicals," says Thadani. The variation in gin comes from distillation techniques, and the concentration and combinations of aromatics and botanicals. In addition, you do not need your own facility to make gin. You can tie up with existing ones and use their licences to distil and bottle your own. Most gin-makers in Goa follow this route. There are exceptions. Khanna started out by leasing out space at an existing facility, but now has his own distillery in Cuncolim. “I wanted all the control in my hands," he says. “Working as a beverage consultant and designing spirits for different companies, it made sense to also do their manufacturing."

The husband-wife duo, screenwriter Devika Bhagat and filmmaker Khalil Bachooali, also wanted their own distillery so they could be in control of every step of the gin-making process. They chose Goa because the cost of the licence for setting up a distillery was affordable as compared to Maharashtra. Tāmras launched last year as a single-shot, multiple-distilled gin, made with botanicals that include lotus seeds. The gin is created and bottled at Adventurist Spirits Distillery in Colvale, which they opened for tours.

Staying alive

As the early bird, Nao Spirits is snacking on the proverbial worm. Their gins are exported to over 15 countries, have picked up awards at spirits’ competitions. Last year, they raised 15 crore in a Series A funding round. In April, Diageo-controlled United Spirits Ltd acquired a minority stake in Nao Spirits for 31.5 crore. The Nao Spirits success story is one that most gin companies would want to emulate.

Meanwhile, Stranger & Sons is also busy making news. In 2018, Third Eye Distillery came out with the second homegrown gin brand from Goa. During the pandemic, they launched Strange Times—pre-batched cocktails and cordials, a G&T kit, and a limited-edition distilled cocktail in collaboration with The Bombay Canteen called Perry Road Peru. They export to New Zealand, Mauritius, Australia, UAE and Singapore. “We wanted to play a part in putting quality gin from India on the global map," says Sakshi Saigal, who founded Third Eye Distillery, an equity-funded company, with her husband, Rahul Mehra, and cousin, Vidur Gupta.

“The early movers [like Nao Spirits and Stranger & Sons] have become the most notable brands — they have enough penetration in the market, pan India, to make it work. The fact that they’ve received funding is proof of concept, and that they’ve got the fundamentals right," says Keshav Prakash, founder, The Vault, a Mumbai-based spirits company.

The success of the smaller to mid-size gin companies will depend on their business goals, he adds, and how quickly they can cross over from being a mid to a large company, with the proper distribution, and cash flow to move forward. “The business doesn’t differentiate between craft or indie or foreign or mass. The essence of craft is consumers are on a discovery journey: they won’t be ultra-loyal to you, so there is no scope for complacency," Prakash says.

The key to surviving, thus, is ensuring the gin keeps making news, through promotions, marketing activities, or even the release of limited-edition gins. “Every few months, there are new brands in the market giving customers more choice. As a gin brand, you have to do a lot more to garner interest, and accentuate the customer experience," says Thadani, who released Pumori Ascent, a limited-edition oak-aged gin in April. Other brands too have limited-edition releases: Nao Spirits and Sleepy Owl Coffee with No Sleep coffee gin, Samsāra (by Spaceman Spirits Lab) with City of Pink, and Stranger & Sons recently collaborated with the award-winning Four Pillars Distillery in Australia to release two gins: Spice Trade and Trading Tides (made in Goa). “These limited-edition creations help to build brand equity and it keeps the conversation going," says Saigal.

Bhagat believes there’s still substantial interest in gin, if the crowd at the recent Gin Explorers Club was any indication. “The sustainability factor can only be made out two years in the business. Some of us may not survive. It is the consumer who will decide. I see already established brands bringing out more expressions, and those who have the capability will get into other spirits," she says.

Tickle’s retail market has expanded to four states and they will be launching in two more this year. The brand has seen a growth of 10- 15% each year though the profits have been affected very badly as the juniper costs have more than doubled and allied raw materials costs have shot up by 40%. “The gin market is growing and Tickle, with it," says Solomon Diniz, founder, Adinco Distilleries. He believes the growth is good not just from the industry perspective: with distilleries like Adventurist opening their doors for tours, and others like Fullarton going to follow soon, distillery tours pose a good tourism opportunity for Goa.

“As more and more brands come out, the profitability is going to go down," says Khanna. Gin Gin started in March 2021 with 150 cases, which sold out within half hour. From 450 a month, he now produces 850 cases a month. Clearly Good, meanwhile, sold 4,500 cases in the year after its launch. “The market may seem saturated but, that’s only in Goa," he says, adding that recent conversations with friends have them overwhelmed by the options available.

Prakash believes there is room for gin brands to grow, especially if they tap India’s non-metros. He cautions that gin will reach a saturation point or a plateau within the next two years; Thadani thinks it could happen by the end of the year. “It is a great market but it is becoming a fickle one. The market size is not growing by leaps and bounds to accommodate the brands jumping in," he says.

As Goa readies itself for another surge of gin brands — insiders say at least four are on the horizon — it will be interesting to see if the ginaissance continues. Other homegrown liquor like agave spirits, vodka and rum are already fighting for space, not taken up by whiskey, in the alco-bev market. Gin, for the moment, is still riding the popularity wave.

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