The alcobev landscape in India is currently a captivating canvas, with single malt whiskys grabbing the spotlight. As the India-UK FTA looms on the horizon, promising a reduction in import duties for Scotch whiskies, the market is set to witness intense competition. Bengaluru-based Amrut Distilleries, the pioneer of Indian single malt whisky, however appears undaunted by the impending changes in the market dynamics.
The distiller is committed to maintaining a distinct and relevant presence in this evolving landscape.“The entire scenario might change, but I think the Indian single malt category has already created a niche for itself, and we are confident that we will be able to take on the competition,” Managing Director Rakshit Jagdale, from the third generation of the family that owns Amrut, told businessline.
Defying the odds
As the global landscape becomes more competitive, Amrut also contends with fierce competition domestically. Over the years, in tandem with the growing whisky consumption in India, well-known industry names such as Diageo, Radico Khaitan, Pernod Ricard and DeVANS have entered the category. But “our market share hasn’t changed,” says Jagdale adding, “it is only good that the Indian single malt category grows in India and internationally, and we grow with it.”
Amrut’s confidence to march froward stems from being the pioneer of the category in India. While Indian single malt whiskys are all the rage today, two decades ago, cultural restraint coupled with hurdles in regulatory approvals, production and distribution, was ever present for any company that tried to make single malt whisky — a category heavily dominated by western alcobev majors then. Braving through these hurdles, Amrut became the first local player to launch the Indian single malt whisky in 2004. The company has grown its portfolio multifold now.
When it comes to international markets, “there was a lot of stigma attached to alcoholic products coming from India, that it took us two years to conform to the EU’s packaging standards,” recalls Jagdale. But Amrut slowly carved a niche for itself and took centre-stage after Amrut’s Fusion was rated as the third finest malt whiskey by whiskey critic Jim Murray, says Jagdale. Today its luxury single malt whisky offering consists of Amrut Peated Indian Cask Strength, Amrut Rye, Amrut Greedy Angels, Chairman’s Reserve. It also has a premium malt whiskey offering named Amrut Amalgam.
While the company primarily drove its sales from international markets in the initial years, it has since then changed. Currently, 60 per cent of sales is from the domestic market and 40 per cent from the international market.
Beyond whiskys, its luxury portfolio also comprises rum of three variants — dark, pale and white and broader portfolio includes brandy, vodka and gin. Jagdale notes that in the last FY, Amrut sold over one lakh cases of whisky netting a revenue of ₹427 crore,of which 25 per cent came from the luxury division.
What sets Amrut apart is its ability to retain a strong whisky portfolio while also excelling in the low-priced beverage market— a segment which some alcobev players have found difficult to hold margins in. “It is a very challenging business at the lower end, but the volumes have been making up for it so far. Going forward, we expect times to be more challenging as the monsoon was bad this season, due to which raw material availability could be affected,” explains Jagdale.
The distiller has a wide manufacturing footprint across India, including units in Bengaluru-Mysore road, Bannerghatta road, Davangere and Palakkad. Additionally, they have contracts in three locations in Kerala and one in Patiala, Punjab. In total, its production capacity reaches five million cases per year.
“Over the years, we have significantly automated our processes, particularly in the shift towards automatic or semi-automatic lines for packaging in cartons. There’s also been an increase in distillation capacity, tripling over the last three years,” Jagdale said. Further on the cards for the company is the launch of a new expression of jaggery rum and plans to increase its production capacity by 25 per cent next year.
Industry experts highlight that the Indian single malt has nowhere to go but up and Amrut leads the way. Abhay Kewadkar, an alcobev consultant and MD of Tetrad Global Beverages, notes that from 15 per cent five years ago, the market share of Indian brands have jumped to nearly 33 per cent as of March 2022.
According to his estimate, the Indian single malts have already captured 40 per cent of the market share and is bound to cross the 50 per cent mark in a year or two. “Amrut Single Malt has put the Indian single malt category on a global platform. With the highest variants of 47 and sales volumes reaching a maximum of 60,000 cases, Amrut Distillery is expected to grow at the rate of 30 per cent, and expansion plans have already been put in place,” says Kewadkar. Cheers to that!