Is India Ready for Craft Beer?
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Despite India preparing to put a stringent ban on liquor sales near major highways to curb ‘drinking n driving’ this year, the NABCA data reveals high growth in consumption levels to an average rate of 8.9% annually in last six years.
The Indian beer market is expected to grow and cross 430 billion by the end of 2017, as per the research of All India Brewers’ Association (AIBA). Tapping brewed beer market at cost-effective rates, a variety of innovative startups have aplenty of ideas for diverse flavors, events and apps that could faciliate customers to indulge.
Microbreweries such as Bira 91, Witlinger and Doolally are attracting interest from venture capitalists as the market looks lucrative.
To know whether India is ready for a craft-beer market or not, Entrepreneur India spoke to Anuj Kushwah, MD and Founder of India’s first craft-bottled beer, Witlinger.
Carving a niche in India’s $35 billion market of alcohol, Witlinger offers premium crafted beer experience to Indian consumers, which comes as Wheat Ale and Lager Beer.
Launched in July 2014 by the parent company Kama Impex as India’s first crafted beer, Witlinger is the brainchild of Anuj Kushwah, an MBA from London in International Trade and Finance.
Brewed by Master Brewers at Brains Brewery in Cardiff, UK, Witlinger claims no competitors in Indian market with the segment of its making style and pricing pattern in India.
On asking if India is ready for craft-beer market yet or not, Kushwah said, Indian market is ready for good 15-20 brands in the current scenario.
“Since Indians like easy drinking, I believe a year or two will see an abundant growth. Our style and the philosophy of execution is different, is what we think our USP in market” adds Witlinger.
In conversation with Entrepreneur India on if India fits in the craft-beer industry or not, Suketu Talekar, co-founder of Doolally said, “This is like asking if India is ready for good food?”
Doolally Craft Beers is India’s first microbrewery to get the license for its business model.
While talking about the scope in India, Talekar said "now is the best time to be a beer drinker in India. Old styles are being reinvented and new styles of beers are being brewed.”
“This is the kind of innovation that has never been seen before by the Indian beer drinker. We have come a long way from going to a bar and ordering 'a beer' to now where we are ordering an 'Independence IPA' or a 'Gateway Doppelganger” adds Talekar.
According to BMI research, “India's underdeveloped beer market holds huge potential for growth and investment. Changing cultural attitudes, low base effects and a young, increasingly affluent consumer base will drive sales over our forecast period. We highlight growing momentum in the country's nascent craft beer industry as further support for our favorable outlook.”
When we asked Indian craft-beer startups about the difference in the drinking habits of Indians, young and old, today compared with five years ago, Talekar said “consumers today are far better informed and discerning as compared to five years ago. They are holding businesses to a higher standard when it comes to products and services they are buying. Also the same lot is far more experimental when it comes to the choices they make while eating out and drinking. That means as a business you are afforded far greater latitude in terms of what you can experiment with.”
Since it takes a longer than expected time to get licensing for brewing beer in India, startups face a lot of legal challenges while setting up their business.
Entrepreneur asked Doolally and Witlinger, how do they feel 2017 will be the year craft breweries will get approvals for newer breweries to cater to a rising demand?
Talekar said, “Each year more small breweries open up as compared to the previous. And each year has seen a new state reforming policy to make way for craft breweries to open. I don't think 2017 will be an exception.”
The craft beer movement in India is slowly building up a momentum from last few years. However, sales were hit due to regulatory obstacles including licensing restrictions, high localized taxes and a nationwide ban on advertising alcoholic drinks.
Indian players have mammoths to fight with in their journey to success. After all Indians love their Hoegaardens, Budweisers, Coronas, Carlsbergs and the evergreen Kingfisher.