Jul 3, 2024 · 3h 12m · wtf
Ep #18 | WTF, Alcohol is a $70B Business in India? | Nikhil Kamath explores Gaps & Opportunities · Nikhil Kamath
Abhishek Khaitan · 39m spoken Suraj Shenoy · 35m spoken Minakshi Singh · 34m spoken Nikhil Kamath · 29m spoken Shuchir Suri · 25m spoken
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
Hosted by Nikhil Kamath, this comprehensive masterclass brings together prominent industry leaders to dissect India's multi-billion-dollar alcohol and beverage ecosystem, detailing the operational, regulatory, and marketing strategies required to build and scale modern spirits brands.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Nikhil holds 18.5% of the talking time here. How this is scored →
Nikhil as informed peer 3.8 Guest teaching 6.0 Guest disagreement 1.9 Nikhil pushing back 2.5
speaking balance: gold is Nikhil, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 2:36:30 Guests firmly dismiss marketing gimmicks without blend quality
When Nikhil suggests using novelty gimmicks like red ants or arbitrary 10,000 rupee pricing, Minakshi, Shuchir, and Abhishek immediately cut in to reject the premise, stating that consumers see through gimmicks without genuine blend quality.
Hardest push from Nikhil ▶ 2:28:33 Abhishek challenges venture capital growth playbooks in alcobevAbhishek explicitly challenges Nikhil on whether 300 crores of VC capital can force-feed a new liquor brand into existence, insisting that alcobev sales must be won over time rather than pushed.
Biggest teaching moment ▶ 21:43 Suraj's historical and microbiological breakdown of IPASuraj educates Nikhil in depth on why IPAs were brewed with high hops and ABV to survive sea voyages to India before temperature control and modern microbiology existed.
Nikhil holds their own ▶ 2:19:04 Nikhil articulates his perpetual fund thesis on Indian hero productsNikhil counters the guest's skepticism about financing 10-year gestation malt brands by detailing his prop-money structure, willingness to underwrite patient capital, and focus on globally competitive Indian brands.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Nikhil as informed peer | Guest teaching | Guest disagreement | Nikhil pushing back | Why |
|---|---|---|---|---|---|---|
| Minakshi Singh on Bartending, Culture, and Building Sidecar | 2 | 5 | 1 | 2 | Nikhil asks basic introductory questions about bartending culture and Sidecar's origins while Minakshi politely corrects common misconceptions regarding bartending grooming, legality for women in India, and cocktail culture. | |
| Suraj Shenoy and the Genesis of Goa Brewing Company | 3 | 7 | 1 | 2 | Suraj gives an extensive masterclass on the history of India Pale Ale (IPA), brewing botany, hops preservation, and craft beer production economics, educating both Nikhil and the table. | |
| Shuchir Suri on Experiential Marketing, GEC, and Mixers | 3 | 6 | 2 | 2 | Shuchir outlines how experiential IPs like Gin Explorers Club monetize marketing budgets in a dark advertising ecosystem, answering Nikhil's queries about experiential nightlife business models. | |
| Abhishek Khaitan on Radico Khaitan and Modern Indian Spirits | 4 | 7 | 1 | 2 | Abhishek details the 70-year evolution of Radico Khaitan, turning around Rampur distillery and launching breakthrough spirits like Magic Moments and Rampur Single Malt, while Nikhil notes his own investment position. | |
| Market Structure, Consumption Patterns, and Societal Psychology | 4 | 7 | 2 | 3 | The panel debates market structure, volume vs value metrics, and the sociological reality behind the 180ml nip and country liquor consumption patterns in urban India. | |
| Blueprint for New Alcohol Brands: Sourcing, Recipes, and Capital | 4 | 7 | 3 | 4 | Nikhil probes the feasibility of launching a liquor brand with 10 crores. The guests push back on naive capital assumptions, explaining the brutal realities of co-packing, tertiary sales, and state listing fees. | |
| Untapped Market Opportunities: Bourbon, Beer, Rum, and Heritage | 4 | 6 | 2 | 3 | Each guest pitches specific high-margin opportunities across bourbon-style spirits, premium rum, indigenous ferments, and craft beer laddering, debating price points and consumer psychology. | |
| Distribution Strategies and Strategic On-Premise Entry | 3 | 6 | 1 | 2 | Abhishek and the panel outline distribution mechanisms, comparing international distributor models with top-tier on-premise bar seeding strategies in major Indian metros. | |
| On-Premise Bar Activations and Menu Pouring Economics | 3 | 6 | 2 | 2 | Minakshi and Shuchir educate Nikhil on the economics of bar tie-up money, menu cocktail placement exclusivity, and the growing demographic impact of women consumers in modern retail. | |
| Bottom-Up Distribution Hacks and Stakeholder Alignment | 3 | 7 | 2 | 3 | Suraj and Shuchir explain bottom-up distribution tactics, such as incentivizing counter salesmen and bartenders rather than relying purely on top-down distributor muscle. | |
| Event Sponsoring, Niche IPs, and Metro Marketing | 3 | 6 | 2 | 2 | Shuchir and Suraj discuss experiential event marketing, explaining why tight sub-cultural IP alignment (such as cycling or niche festivals) beats broad mass sponsorships like IPL. | |
| State Listing Costs and State Excise Revenue Reliance | 5 | 6 | 2 | 3 | Nikhil cites state revenue dependencies on excise, while Abhishek and Suraj discuss state listing fees, inter-state duties, and the structural necessity of GST inclusion. | |
| Long Gestation Cycles and Capital Allocation in Alcobev | 7 | 5 | 2 | 4 | Suraj questions Nikhil on how venture capital can fund long gestation spirits businesses. Nikhil articulates his perpetual prop-money thesis and product-first investing philosophy. | |
| Celebrity Endorsements Versus Sustainable Organic Brand Building | 4 | 6 | 3 | 4 | Abhishek and the panel push back against capital-dumping and celebrity endorsements in alcohol, arguing that liquor sales must be earned through taste and organic word of mouth. | |
| Influencer Economics and Luxury Alcohol PR Dynamics | 4 | 6 | 1 | 2 | The panel distinguishes between luxury PR awards for ultra-premium bottles versus targeted, authentic influencer outreach for mid-tier accessible spirits. | |
| Premiumization, Blind Taste Tests, and Cultural Authenticity | 6 | 6 | 4 | 4 | Nikhil proposes pricing up an Indian whiskey using gimmicks. The guests firmly reject pricing gimmicks, emphasizing blend authenticity and discussing Indian cultural pride as a brand driver. | |
| Agave Spirits, Distillation Science, and Hangover Biology | 3 | 7 | 2 | 2 | The guests dismantle hangover myths, explaining distillation cuts, congeners, fusel oils, and the difference between neutral spirits and complex aged spirits. | |
| Underrated Spirit Selections Across the Alcobev Landscape | 2 | 5 | 1 | 1 | Each guest shares their favorite underrated alcohol selection, spanning Michter's Rye, Campari, Glenfarclas/Glengoyne malts, and indigenous aged rums. | |
| RTD Cocktails, Hard Seltzers, and Retail Cold-Chain Bottlenecks | 3 | 6 | 3 | 2 | Suraj presents a contrarian view on hard seltzers in India, while Abhishek identifies the retail store cold-chain shortage as the key bottleneck holding back RTDs and beer. | |
| Retail Store Licensing Economics and Airport Duty-Free Disparities | 3 | 5 | 1 | 2 | The guests compare retail tender auctions in Haryana with airport duty-free margins and state-level tax disparities across Maharashtra, Delhi, and Goa. | |
| Online Alcohol Delivery Feasibility and Platform Margin Risks | 4 | 7 | 3 | 3 | Suraj and Abhishek analyze online alcohol delivery economics, warning about aggregator platform squeeze against slender 12-15% manufacturer margins. | |
| Import Tariff Reductions and Structural On-Premise Imbalances | 4 | 6 | 2 | 2 | The panel discusses proposed import duty cuts on foreign spirits, while Minakshi reveals structural purchasing imbalances penalizing Indian craft spirits in on-premise bars. | |
| Excise Bureaucracy, Pricing Controls, and Profitability Realities | 4 | 7 | 2 | 3 | Suraj and Shuchir recount dealing with state excise bureaucracies, labeling regulations, and event VAT advances, while Nikhil questions the myth of easy liquor profitability. | |
| Seed Fund Commitment and Collaborative Episode Finale | 5 | 2 | 0 | 1 | Nikhil rallies the guests to pool a seed grant fund to back young aspiring alcobev and bar entrepreneurs, closing the episode collegially. |
Statements from this episode (67)
Singh: Women are legally barred from bartending in certain Indian states
“Today, to certain states in India, women are not legally allowed to serve also, like even waitressing wise, or be actually making drinks.”
Minakshi Singh: Sidecar generates 85% of beverage sales from cocktails
“I'm sitting in a very good, 85% cocktails and the rest.”
Shenoy: Pernod Ricard earns ₹25,000 crores as India's most profitable liquor company
“Yeah, like, 25,000 crores in revenue. It's, I think, the most profitable liquor company, but entirely.”
Khaitan: Diageo's market share dropped to 20-25% after offloading cheaper brands
“Now like Diageo has given off the less expensive brands to Inbrew. Earlier their market share would have been about close to about 35. So now they'll be same about 20, 25.”
Khaitan: Radico Khaitan's liquor recipes are known by only two people
“Like only the chief master blender, it's called as a black book. So like we don't share with anyone. Like only I have it and my blender would have it.”
Shenoy: Macro lager beer producers achieve 55% to 60% margins
“With extremely high levels of efficiency, if you are producing mass macro lagers, you probably get into the range of between 55%. And because they also recycle, a lot of bottles come back. It's very efficient in terms of cost structure. And it can be stretched…”
Shenoy: Goa Brewing refuses to pay bar entry or listing fees
“Bars keep our product for the product quality, but we don't pay for entry into any bar.”
Shenoy: Bira gets most volume from mass strong beer category
“Beera also gets majority of its volumes from the same category as Hayward's 5000 and Kingfisher's Strong, where it's the base category where in certain states they really get a lot of volume.”
Singh: India will remain a whiskey market for a long time
“So we're still a whiskey market. Like we will be a whiskey market for a really long time, so.”
Kamath: Holds a 1.7% equity stake in guest Abhishek Khaitan's company
“So we are a very small miniature partner to Abhishek in his business as an equity partner. It's a investment that has done very well for us. We've never spoken about it publicly, but we've spoken like privately many times about it. I think it's 1.7%.”
Khaitan: Magic Moments accounts for 60% of India's vodka sales
“Today we are proud that magic is the seventh largest vodka in the world. And in India, out of all the vodkas, starting from a regular to a Grey Goose or a Kaufman, 60% of any vodka sold is magic.”
Shenoy: India consumes ten times more hard liquor than Vietnam
“So the interesting thing is in India is the only country in the tropical zone where you do roughly around three hundred and fifty million cases of heart liquor, considering you also country regular spirits also, and about the same quantity of beer. But if you …”
Khaitan: India drinks 400M cases of hard liquor annually
“Four hundred million is the hard liquor. So four hundred million cases. Country liquor would be again a three hundred million cases market.”
Suri: Delhi charges ₹12 lakh per brand as a liquor listing fee
“In Delhi, you have to pay per brand, which will be about 12 lakh rupees for vodka and gin.”
Khaitan: Pan-India Liquor Distribution Requires 35 Bottling Units
“In our industry, if you want to go all India, you have to have 35 bottling units.”
Khaitan: Liquor Brands Die When Ignoring Secondary and Tertiary Offtake
“The minute you push your primaries and you don't look at your secondaries and tertiaries, the brand is finished.”
Khaitan: Scaling a liquor brand realistically requires at least ₹50 crores
“With a six crore fund, you, it's like, if you click it, you're a god. But you should have that capital of at least 50 crores, et cetera.”
Shenoy: Setting up a small homebrewing kit costs under 5,000 rupees
“You don't need more than 5000 rupees to create a small homebrewing kit at home.”
Shenoy: India's premium beer segment is roughly 55 to 60 million cases
“This is currently roughly around a 55 to sixty million case industry.”
Shenoy: Diageo's Celebration Rum now significantly outsells Old Monk
“I think Celebration Ram, which is of DI Joe, now outsells Old Monk quite a bit.”
Khaitan: 98% of Brandy in India Sells in the South
“See, I think brandy, 98% of the brandy sells in South.”
Khaitan: Vodka was India's fastest-growing spirit category over the last five years
“Vodka has been the largest growing category in the last five years.”
Khaitan: Flavored Vodka Accounts for 80% of India's Vodka Market
“In vodka, 80% of the market now has become flavored vodka.”
Suri: Ready-to-drink alcohol will take off in India in 5-7 years
“Rum and tunics and RTDs. Radio drink beverages. That's about five to seven years from now, but I see that picking up.”
Khaitan: New Alcohol Startups Need 70-80% Gross Margins to Survive
“For any newcomer you have to, your gross profit has to be high. It has to be 70 to 80%, else you'll fail. If you try to compete with the masses, big boys will take you.”
Khaitan: Winning the top 10 trendiest bars drives automatic on-premise adoption
“In a state, suppose if you are there, you address the 10 trendiest bar. So the minute you are there, other bars will copy you. They'll say that if you give, like, if you have an entry to one on-premise, like say a sidecar in Delhi. If anyone knows that, okay, …”
Singh: Liquor brands pay bars 'tie-up money' for cocktail menu priority
“If I'm getting a majority of, say, a tie-up money, it's called a tie-up money, which basically means if I'm working with a Diageo, or a Pernod, or a Bacardi, or even a Radico, I will be then prioritizing their brand over other brands to actually make cocktails…”
Singh: Shelf placement and pouring rights are completely different bar dynamics
“Pouring and putting it on shelf are two different things.”
Singh: Women drinking more is driving Indian liquor market growth
“Women are definitely drinking more. There is no doubt about that. Like that is a big plus for us, for the growth also. So because the fact that there are many, many women joining into the drinking occasions, multiple times.”
Khaitan: Modern large-format retail makes liquor shopping safe for women
“That earlier, if you would have gone into any shop, you know, Aryana, Mumbai, women can't go and shop. They'll be looked down, like, you know, they'll not feel safe. But today, if you see the shopping experience, whether it's Bangalore, whether it is Gurgaon, …”
Shenoy: Zero-to-one alcobev brands must build tertiary retail demand before signing distributors
“If you are an absolute zero to one person starting out, I would say once you identified what product you are doing, just take a few bottles and there are three layers to distribution. What you manufacture is called as the primary. Then you, what your distribut…”
Suri: Finding a willing distributor is the hardest hurdle for new alcobev brands
“Going from zero to one, the hardest thing for a newbie is to find a distributor. It's not as easy as you think it is. A lot of people don't want to take your brand.”
Suri: Beer brands paid bartenders ₹20 per bottle cap to push sales
“In the beer industry, when I was running Jade, I remember this so clearly, people would pay the bartender outside of their job, you return caps to me, I'll give you 20 rupees a cap. For depletion. To make my distributor happy so he sells my product. So I'm bur…”
Shenoy: Alcobev startups cannot win by competing purely on capital against multinationals
“If you are going to compete with money, then you are already out of the game because you're competing with people who have like a 102 hundred billion dollar, you know, all the biggest industry is run by multinationals.”
Suri: Alcohol brands cannot legally market their own event content online
“Legally event, alcohol brands in India, they cannot do their own events. They can do their own events, but they cannot market the content legally online post doing an event.”
Khaitan: Sponsoring the IPL requires a ₹100 crore budget
“IPL, if you sponsor, you have to have a budget of a hundred crore.”
Khaitan: Mumbai is the most expensive Indian market to launch alcohol brands
“Mumbai is the costliest. Any city, like if you want to launch his beer from Mumbai, as a startup, it's very tough. The kind of money it burns, like, you know, it like I addressed Mumbai the last. It's the most expensive market.”
Suri: The listing fee to legally sell alcohol in Goa is ₹50,000
“You'll pay Rs. 50,000 rupees as your listing fees to legally sell your alcohol in Goa.”
Suri: Listing a single whiskey SKU in Delhi costs ₹25 lakh
“Whiskey is 25 lakh rupees per SKU in Delhi to get your product listed.”
Khaitan: Radico Khaitan contributes 26% of Uttar Pradesh's alcohol excise revenue
“And we contribute 26% of the state's revenue.”
Khaitan: Radico operates 41 units to navigate interstate alcohol duties
“I have to manufacture every, that's why I have 41 units. That's the biggest entry to barrier.”
Kamath: International product competitiveness matters more than financials when investing
“If I like a product in a certain category, The marketing, the sales, the narrative, the financials, all of that comes second. If I can find a product that can compete internationally, I'll do it.”
Kamath: Indian Gen Z is drinking less alcohol than Millennials
“The data I'm accessing today is we typically tend to mimic the West in terms of consumption patterns in India. And the fact that the Gen Z are drinking lesser than millennials is something which is of a worry to me.”
Kamath: Launching equity-free grants of ₹20-40 lakhs for founders under 25
“We're starting this new fund. It's not actually a fund. It is a grant. It is three times as big as Shark Tank. We don't, in terms of the amount we give out, We don't take any equity in the businesses that we give these grants to. We're just looking at young pe…”
Kamath: Celebrity-led fashion and cosmetic brands fail in India unlike globally
“When I've looked at fashion, cosmetic, brands led by celebrities, In India have not worked. Globally have worked.”
Khaitan: Alcohol brands cannot force sales through heavy capital and advertising
“Because what I believe in alcohol, you cannot push sales. You have to win sales. Like, as I said, first 10,000 is important. So even sometimes I brew with that idea whether is it the right strategy, but in my last 20 to two decades of my experience, I feel It'…”
Shenoy: Indian alcobev brands mask poor retention through rapid geographic expansion
“So by the time you go to Thana and you're going to the suburbs and everything, you're still growing because you're doing primary sales, but your original core consumers doesn't come back to you repeat. This, you start going from Thana now to Nasik, from Nasik …”
Singh: Influencers acquire consumers far more cheaply than actors for alcohol brands
“So now good thing is, it's a far cheaper way to acquire consumers than actors.”
Khaitan: Luxury spirits above ₹8,000 must rely on PR, not direct marketing
“If the higher you go, suppose you go eight, 10,000, you don't need any marketing. If you market, you won't be able to sell. The only thing should be Word of mouth and PR press and the competitions.”
Suri: Wealthy Indians prefer an ₹8,000 Scotch over a ₹10,000 Indian whiskey
“If there is an 8000 rupee scotch, and a 10,000 rupee Indian whiskey, that rich person will go for an 8000 rupee scotch.”
Khaitan: Building a proudly Indian brand is now the best commercial strategy
“A hundred percent. I think Indian, Being a proud, like always I've advocated, being a proud company, Indian company is the way forward. People are looking for Indianness. People are proud to be Indian. Like even if you see all my products, it's all Indian.”
Khaitan: Radico sells a ₹5 lakh Rampur single malt bottle
“Like Rampur, that five lakh rupee bottle has written in Sanskrit on this. That happiness lies within.”
Suri: Significant market opportunity exists for Indian agave-based spirits
“And I believe there is space for a Gave based spirit in India. If There is enough money to educate people that, okay, yes, tequila is, has to be blue, weber, gawe from the region of tequila, from the region of five, six states. But there is a space for a gawe-…”
Shenoy: Beer is the hardest alcohol to produce because flaws cannot hide
“That's why beer is the hardest because you have no room to hide. You're just doing pure fermentation. It's the hardest thing to do because you make a mistake. Anybody will catch.”
Shenoy: Multinationals like Pernod Ricard and Diageo are launching Indian malts
“There's so much more happening in whisky, where there's big money, and there are big multinational, like Pernod, D.I. Joe's all launching their Indian malts now. It's not just Amrut, Paul John, and Radico. It's opened up quite a lot.”
Shenoy: Hard seltzers will lack stickiness in India compared to the US
“The Americans were mixing their whiskies with coke, but we in India are anyway mixing with soda and water. So if you're going to create a seltzer, everybody's making their own seltzers here. So how are you even, it's, so it's to make something like that from a…”
Suri: Gurgaon liquor stores get Diageo and Pernod to fund their construction
“But now nowadays in Gurgaon, it works on some bidding system. And then actually the store doesn't pay for construction. They go to a Diageo, they go to Perno and they said, this is my space. Turn it around in 30 days. And then it's a full branded store of a ce…”
Suri: Alcohol prices between Gurgaon retail and Delhi duty-free barely differ
“Duty free also takes a percentage of your sales, which actually now from Gurgaon to duty free, there's not too much difference, at least from Gurgaon to a Delhi duty free.”
Khaitan: Rampur whisky is ₹8,500 at Mumbai duty-free versus ₹12,000 retail
“So let's give an example, say Rampur in the Mumbai duty free would be 8500 and in the retail 12 another thousand.”
Shenoy: Retail margins for successful Indian liquor brands run 12% to 15%
“The blended margin for a successful brand in the retail is somewhere around 12 to 15%, including your trade scheme. Nobody goes beyond that unless you are a very early brand and it's a push sale.”
Shenoy: 25% aggregator commissions make online alcohol delivery unviable for brands
“When you do the delivery model and you start adding that extra cost, I think somewhere around your, you're already having your back towards the wall when it comes to margins for liquor companies, if it stretches to what Zometo or Swiggy do, Or 25%, then it bec…”
Khaitan: Radico Khaitan's Indian single malt is priced higher than imported malts
“So today also, if you see Indian products are priced higher, like say our malt is priced higher than any of the well-known malts also.”
Singh: Delhi bars must buy premium Indian spirits in 12-bottle cases
“I can't buy a single bottle. I can't buy a single bottle of Rampur. If I buy, I have to buy 12. Which basically means, look at my inventory.”
Singh: Delhi Excise and CSD mandate the lowest national price to register
“Delhi has always wanted the lowest. CSD wants the lowest EDP. So they ask for it. They say, are we the cheapest in India? Only then you can register.”