Pernod Ricard: India Now Largest Market by Volume, 2nd by Value

New Delhi, Jul 18 (PTI) India is now the largest market by volume and second-largest by value for the French spirit maker Pernod Ricard, which owns popular brands such as Absolut, Chivas Regal, and Glenlivet, said its India MD Jean Touboul on Wednesday.

The India market, which reported a 6.1 per cent growth in net sales in FY24, has become a "growth engine" for Pernod Ricard, he said. The French company also owns the IMFL portfolio of Royal Stag, Blenders Pride and Imperial Blue.

Besides, India has become the second largest market for Scotch whisky Glenlivet and Irish whisky Jameson as the Indian whisky market is witnessing premiumisation, Touboul told PTI in an interaction.

The company is also increasing exports from India by taking its Seagram's portfolio of Royal Stag, Blenders Pride and Imperial Blue to around 70 markets from the present 40 countries, targeting the Indian diaspora.

Pernod Ricard is also investing 200 million euros to build its biggest Asian distillery in Nagpur, Maharashtra, which would boost its exports, especially of Longitude 77, the first Indian single malt whisky from the French spirits maker.

"India remains a major growth engine for the company, and this has been confirmed year after year. Last year ending on June 30, 2024, we grew 6 per cent in India, which is quite robust if you compare with the rest of the world," said Touboul.

Now India contributes 12 per cent to the global revenue of Pernod Ricard. The US is the largest market for the French firm.

"Our CAGR over the last five years averages 8 per cent, placing us in the high single digits. We aim to improve this further, targeting double-digit growth in the future," he said.

Pernod Ricard India (PRI) reported a consolidated revenue of Rs 25,039.47 crore for the financial year that ended on March 31, 2023. The company, which is not a listed entity, is yet to file its annual reports to the Registrar of Companies. Pernod Ricard is the second largest liquor company in India in terms of revenue after Diageo which controls United Spirits.

However, in its global earnings call, Pernod Ricard informed that India has become its second-biggest market after the US in value terms, replacing China.

The French spirit maker which follows the July-June fiscal year, said it had a "strong, broad-based and accelerating performance" underpinned by strong consumer demand from the Indian market, where sales are premiumising.

"This growth has enabled us to become the second-largest market. This is a testament to our strategic focus on premiumization rather than sheer volume. While expanding our presence is important, our goal remains to create value by encouraging consumers to elevate their choices," he said.

He further said: "Our efforts include continuing to export our Seagram portfolio of whiskies, which we are currently exporting to over 40 countries. Our goal is to expand this to 70 countries in the next few years. This is how we contribute to the growth of the group."

As per its market strategy, PRI would focus on premiumisation, giving more "priority to value over volume" which is the trend in India.

"Premiumization is core to our strategy. Innovation is another pillar," said Touboul adding "It is natural to invest more and to try to develop faster the highest price point, because this is where we see the market evolving, and this is where we see more value to be created.

PRI recently unveiled two whiskies - Royal Stag Double Dark Peaty Whisky and Blenders Pride Four Elements Premium Whisky.

"Thanks to the macroeconomic development of the country, people are growing in wealth, growing in revenue, and there is a natural aspiration towards the higher category, where we invest in our brands to make them aspirational, and we try to cater the needs of this consumer," he said.

According to Touboul, India has become the second-largest market for Glenlivet and Jameson. The US is still the lead market for both brands. India has replaced South Africa as the second-biggest market for the Irish whisky brand.

Touboul also pointed out that though India is largely a whisky-drinking country, other drinks such as gin and Vodka are also becoming popular.

"It is an interesting development for the market. India remains primarily a whisky market, that's a fact, but there is a growing interest for the different categories," he said adding the faster development is led by females joining as customers at a faster pace.

Pernod Ricard also owns Scotch whisky maker Chivas Brothers, which has popular single malt and blended Scotch whiskey brands Chivas Regal, Ballantine's, Royal Salute and The Glenlivet, is pinning hopes on early signing of the UK-India Free Trade Agreement, which will be "favourable" for both countries.

"If FTA comes, it can boost the development of ... the Scotch whiskeys, in particular, in India, but also exports of Indian whiskys, Indian single malt in particular, to the UK. So I think there are benefits on both sides," he said.