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Informist, Friday, May 15, 2026

 

--United Spirits: 180 ml packs driving growth of Royal Challenge brand 

--CONTEXT: Comments by United Spirits' mgmt in post-earnings analyst concall 

--United Spirits:India-UK FTA to drive scotch growth in India on lower prices 

--United Spirits: Smirnoff, Don Julio became INR 1-bln brands in FY26 

--United Spirits: See some margin impact in Q1 due to higher packaging costs 

--United Spirits: See strong double-digit growth in Karnataka in FY27 

--United Spirits: Looking at launching 180-200 ml packs across portfolio 

 

By Avishek Rakshit & Astha Oriel

 

KOLKATA/MUMBAI – United Spirits Ltd. plans to roll out 180-200 ml packs for nearly all of its brands in its push to generate more sales translating into revenue growth. Currently, the liquor company offers some of its brands in this pack size, often called 'pint' by the industry.

 

"Pocket-packed 180ml has done magic. Very, very importantly, it softens the pocket spend and allows people to premiumise constantly and therefore sample our product. That's what it's done, and it's doing very, very well," Praveen Someshwar, managing director and chief executive officer of United Spirits, said in a post-earnings call with sector analysts. 

 

United Spirits launched the 180 ml pack for some of its brands, including the Royal Challenge brand of whiskey, which Someshwar said is doing well and is one of the key growth drivers for the brand. It also launched a pint of the Johnnie Walker Blonde brand as well. 

 

"We are starting to look at our portfolio (for) the 200 ml play," the top official said, adding that customers get to sample the company's products in this way and over a period of time become brand loyalists who continue to drive the top line. It is also widely believed in the industry that lower pack sizes are more popular in semi-urban and rural areas where consumers typically spend less as compared to metro cities. 

 

"In a country like India, it has the highest salience across categories," Someshwar said.

 

While the company is bullish on the India-UK free trade agreement, which will lower the prices of imported scotch and eventually result in lower prices for the consumer, it is also strengthening its non-core portfolio which involves white spirits. United Spirits' core portfolio comprises scotch whiskey. 

 

Someshwar said the Don Julio brand of premium tequila and the Smirnoff vodka brand have crossed INR 1 billion sales in the last financial year and Smirnoff is headed towards becoming an INR 5-billion brand in the coming days. Currently, Black Dog, Black & White, and Signature – all brands of scotch whiskey  – are INR 5-billion brands. 

 

However, the company may feel a negative impact on its margins in the ongoing quarter owing to higher input costs. 

 

"Packaging material costs are broadly one-third of my overall cost and what we are seeing is, in the April-June quarter itself, packaging material costs will inflate by about 4-5% higher than the normal rate," Someshwar said. "So, we do expect an overall gross margin impact, anything between 1.25% to 1.5% on our total portfolio."

 

Roughly, packaging costs may surge by INR 350 million-INR 400 million in the ongoing quarter, the official said, adding that if the West Asian crisis continues for an extended period, this amount could well become 2-2.5 times for the September quarter. 

 

However, United Spirits is bullish about posting strong double-digit sales growth in its home state Karnataka in the current financial year. Sales from this state account for 6.5% of its annual revenue.

 

Under the state's new liquor policy, prices have declined, making alcoholic beverages cheaper, especially the higher volume variants. While beer prices declined 20-25% from prices under the former policy, prices of whiskey declined 20%. However, prices of lower volume products have increased under the new policy. 

 

"We've seen reduction in pricing depending on which part of the portfolio it is, anywhere between 15% to 35%, which is significant," Someshwar said. Usually, price declines lead to higher demand and hence, higher sales. 

 

On Friday, shares of United Spirits closed 3.8% higher at INR 1,320.70 on the National Stock Exchange.  End

 

Edited by Avishek Dutta

 

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