Pernod Ricard Launches 'Xclamation' Range in India, Capitalizing on Premium Demand
Pernod Ricard SA introduces its new 'Xclamation' range in India, aiming to capitalize on the growing premium alcoholic beverage market. India represents 13% of Pernod Ricard's global business, making it the company's second-largest market. Despite challenges, the company's sales in India grew by 6% in the last fiscal year, with Royal Stag showing double-digit growth. The 'Xclamation' trademark has been registered for both soft drinks/mixers and alcoholic beverages, indicating a comprehensive market approach. However, the company faces potential challenges due to a recent excise tax increase in Maharashtra.
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French spirits giant Pernod Ricard SA is making waves in the Indian market with the introduction of its new 'Xclamation' range, a move that underscores the company's commitment to capitalizing on India's growing thirst for premium alcoholic beverages.
India: A Key Market for Pernod Ricard
India has emerged as a crucial market for Pernod Ricard, now representing 13% of the company's global business and securing its position as the second-largest market overall. This significance is further highlighted by the performance of Jameson whiskey, which has become the second-largest market by volume and the top imported spirit brand in the country.
Strong Performance Amidst Challenges
Despite facing headwinds, Pernod Ricard's sales in India grew by 6% in the fiscal year ending June. The company's flagship brand, Royal Stag, posted impressive double-digit growth, reflecting the strong underlying consumer demand in the market.
CEO Alexandre Ricard expressed optimism about the Indian market, citing "strong underlying consumer demand and dynamic premiumisation trends" as key drivers for the company's performance and strategic decisions.
The 'Xclamation' Launch
The introduction of the 'Xclamation' range marks Pernod Ricard's latest effort to tap into the premium segment of the Indian market. The company has registered the Xclamation trademark in two categories:
- Soft drinks/mixers
- Alcoholic beverages
This dual registration suggests a comprehensive approach to the Indian beverage market, potentially offering both alcoholic and non-alcoholic options under the new brand.
Market Outlook and Challenges
The Indian alcoholic beverage industry is poised for significant growth, with Crisil research projecting an 8-10% expansion in the current financial year. The market is expected to reach a value of Rs 5.3 lakh crore, presenting substantial opportunities for players like Pernod Ricard.
However, the road ahead is not without challenges. The company faces a potential setback in Maharashtra, a key market, due to a recent increase in excise tax from 300% to 450%. Implemented in mid-July, this tax hike could lead to retail price increases of over one-third in the state, potentially impacting consumer demand.
Looking Ahead
As Pernod Ricard navigates the complex Indian market with its new 'Xclamation' range, the company's success will likely depend on its ability to balance premium offerings with strategic pricing, especially in light of regulatory challenges. The launch of 'Xclamation' demonstrates Pernod Ricard's commitment to innovation and its confidence in the Indian market's potential for premium alcoholic beverages.
With India solidifying its position as a key market for the French spirits major, industry observers will be keenly watching how the 'Xclamation' range performs and whether it can contribute to Pernod Ricard's continued growth in this dynamic and evolving market.
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