Diageo is poised to massively up its presence in India

Diageo is poised to massively up its presence in India

Earlier today (25 September), Diageo confirmed that it is seeking to buy a stake in UB Group's United Spirits division in India. Here's a look at the Indian alcoholic drinks landscape and Diageo's current position in it.


  • India is a young country and is getting younger every year: More than 60% of the population is below 30 years of age
  • The emerging middle class – which accounts for around 13% of the population - is projected to increase to more than 60% of the population in the next 15 years due to the rapid growth in income
  • Around 19m new consumers enter Legal Drinking Age (LDA) every year and 4.3m of those are entering the Total Beverage Alcohol (TBA) category
  • For Diageo, the relevant base of urban consumers entering LDA is 1.4m per year. This is forecast to grow substantially over the next ten years
  • The Indian branded spirits market has grown at a rate of over 20% since 2005 to reach around GBP2.7bn (US$4.38bn) last year
  • The country's TBA market is expected to grow at a 10% CAGR for the next five years
  • The domestic spirits market is dominated by locally-produced brands in the following categories: Whisky (60%), rum (20%) and brandy (15%). Scotch whisky contributes to about 1% of the overall spirits market, while imported vodka accounts for about 3%

Diageo in India

  • The company sells around 1m cases of spirits per year in India
  • It has approximately 300 employees
  • According to 2010 data from The IWSR, Diageo's market share of Scotch whisky in India stands at 27%. Combined with travel retail in the country, that share is 32%. Smirnoff accounts for 10% of the total vodka market
  • Scotch and vodka are the fastest growing spirits categories in India, driven by the rises in both disposable incomes and LDA+ consumers
  • Diageo's presence in Scotch in India is led by Johnnie Walker Blue, Gold and Malts in the 'super deluxe' sub-segment, Johnnie Walker Black Label in the 'deluxe' sub-segment, Johnnie Walker Red Label in the 'standard Scotch' sub-segment and VAT69, Black and White and Haig in the 'secondary Scotch' sub-segment
  • The company is positioning its Reserve Brands portfolio – including Johnnie Walker Gold Label, Blue Label and Talisker Scotches and Cîroc and Ketel One vodkas – to benefit from the rise of the emerging middle class