Radico says vodka's share of India's IMFL market reaches 6.3%

Radico said vodka accounted for 6.3% of India’s Indian-made foreign liquor, or IMFL, market in Q2 FY27, up from 3.7% in 2025, and management expects flavored vodka to outpace other spirits categories over the next three to five years. Radico’s vodka volumes rose about 49% in the quarter.

How has vodka's share of India’s IMFL market changed?

Vodka’s share of India’s liquor market rose to 6.3% in Q2 FY27 from 4.5% in 2026 and 3.7% in 2025, according to Radico management. The 2.6-percentage-point increase from 2025 was cited as evidence of a structural consumer shift toward white spirits rather than a one-quarter change.

Radico compared India’s 6.3% vodka share with vodka’s 28% share of the global liquor market. Management did not project that India would reach the global level, but said a 1-percentage-point shift toward vodka would add about 4 million to 4.5 million cases to the category, before normal industry growth.

Why does Radico expect vodka demand to keep growing?

Radico expects vodka, particularly flavored vodka, to outpace every other spirits category over the next three to five years. Management said vodka has grown about 20% year on year during the past five years, although it did not say the recent 40% to 50% growth rates would continue at that pace.

Management attributed the trend to Gen Z, younger consumers and women choosing lighter and more easily mixable spirits. It also linked the shift to cocktails, casual drinking and daytime consumption, which it said have increased demand for versatile white spirits.

Flavored vodka accounts for about 75% of Radico’s vodka portfolio, compared with about 25% in international markets, management said. Radico’s Flavours of India range includes Mango, Jamun and Aam Panna, and management said one or two additional flavors are planned.

Radico said Jamun had become a “craze” and that Aam Panna, launched in the month before the call, was generating high tertiary-market interest. These were management comments on early traction rather than disclosed sales figures, but they show that flavor innovation is central to its effort to widen vodka consumption occasions.

How is Radico benefiting from the vodka shift?

Radico reported vodka volume growth of about 49% in Q2 FY27, compared with 36% growth for its total prestige and above, or P&A, portfolio. Management said non-vodka P&A grew about 20%, while the industry’s P&A segment grew about 5.8% to 6%, making vodka the faster-growing part of Radico’s premium portfolio.

Vodka represents about 30% of Radico’s volume, while whisky accounts for about 40% to 45%; brandy, rum and a small gin business comprise the balance. That mix means the category already has a material role in Radico’s portfolio, rather than being limited to a new-product opportunity.

Karnataka helped Q2 FY27 performance after duty reductions and free pricing, with Radico’s premium volumes there rising more than 100%. However, management said Karnataka represented only 6% of Radico’s sales mix, while other states were also contributing meaningfully to overall growth.

Which markets and products are supporting the strategy?

Maharashtra returned to P&A growth in Q2 FY27, according to Radico, after vodka reached 10% of the state’s industry and the company retained a market-leading position in that category. In Tamil Nadu, which management described as India’s largest market, Radico said volumes were up 20% after tertiary-basis orders began in September.

Radico expects whisky and brandy in P&A to grow above 20%, even though vodka is expected to grow faster. Management identified 8PM Premium Black, After Dark and Royal Ranthambore in whisky, and Morpheus in brandy, showing that its premium-growth plan extends beyond white spirits.

The company also cited Virasat Indian Single Malt as a newer premium launch receiving a strong response across states. Virasat is priced at about Rs 3,500 to Rs 4,000 a bottle, while Radico said its luxury portfolio generated Rs 475 crore of turnover in the prior year and remains on course for 25% value growth in FY27.

After Dark grew about 60% last year, and Radico said the relaunched brand had entered 10 states after its packaging change. Management said consumer and customer response had been positive, but did not disclose a Q2 FY27 sales figure or a nationwide rollout timetable.

What could affect Radico's vodka-led growth outlook?

Raw-material and packaging costs remain the principal near-term variable identified by management. Radico said grain and packaging inflation reduced Q2 FY27 gross margin by Rs 27 crore, or about 155 to 160 basis points, following a Rs 30 crore packaging-material impact in Q1.

Management nevertheless retained FY27 earnings before interest, tax, depreciation and amortisation, or EBITDA, margin guidance of 20%. Q2 FY27 EBITDA margin was 20.4%, up 462 basis points year on year, while management said the IMFL business margin was approximately 24% or more, compared with about 9.5% to 10% for non-IMFL operations.

Radico expects grain prices to stabilise from November as the new crop season begins, and cited a 72 lakh metric tonne Food Corporation of India allocation under the ethanol policy. This is management’s outlook, while glass-bottle, polyethylene terephthalate resin and laminate costs remain unpredictable amid West Asia-related volatility.

Competition may also rise as vodka expands. Radico said more entrants could create greater visibility for the category, while it plans further Flavours of India additions after Mango, Jamun and Aam Panna; the pace of new launches by competitors and their consumer acceptance were not quantified.

Conclusion

Vodka’s rise to 6.3% of India’s IMFL market in Q2 FY27, from 3.7% in 2025, supports Radico management’s view that consumer preferences are shifting toward white spirits. Radico’s about 49% vodka-volume growth exceeded its 36% P&A growth, while flavored products, which make up about 75% of its vodka portfolio, are the main mechanism it is using to participate in that shift.

The next indicators are whether vodka continues to outpace other categories during the three-to-five-year period outlined by management, and whether further flavor launches build on the early response to Jamun and Aam Panna. Management also expects grain prices to stabilise from November and working capital to normalise in the second half of FY27, while packaging costs and state pricing decisions remain unresolved factors.