Best Liquor Stocks in 2024

Last Updated on Apr 19, 2024 by Harshit Singh

Did you know the Indian alcohol market is anticipated to reach Rs. 5,482,851.3 bn by the end of 2027? This growth is driven by a steady increase in alcohol consumption over the past three decades. As a result, many Indian breweries have profited from this rising demand, evident in their improved financial performance. With the promising growth outlook, it presents an opportunity for investors to dive into the industry and add diversity to their portfolios. In this article, let’s look at the various lists of liquor stocks, an overview of the liquor industry, and factors to consider before investing in liquor stocks in India.

What are liquor stocks?

Liquor stocks are stocks of companies that operate in the alcoholic beverage industry. These companies are involved in the production, distribution, and sale of alcoholic beverages such as beer, wine, spirits, and other related products. There are numerous liquor brands in India, out of which only 17 are listed. Let’s look at the top alcohol companies in India.

Best alcohol stocks in India – Market cap

Note: The list of liquor stocks listed in India based on the market cap is sorted using Tickertape Stock Screener on the date 4th April 2024. Below-listed filters are used to get the desired results. 

• Sector > Consumer Staples > Alcoholic Beverages
• Market Cap – Sort from highest to lowest
• PE Ratio

Alcohol stocks India – Highest net profit margin

Note: The list of liquor stocks listed in India based on the net profit margin is sorted using Tickertape Stock Screener on the date 4th April 2024. Below-listed filters are used to get the desired results. 

• Sector > Consumer Staples > Alcoholic Beverages
• Market Cap 
• PE Ratio
• Net Profit Margin – Sort from highest to lowest

Top liquor stocks in India – Highest dividend

Note: The list of liquor stocks listed in India based on the highest dividend yield is sorted using Tickertape Stock Screener on the date 4th April 2024. Below-listed filters are used to get the desired results. 

• Sector > Consumer Staples > Alcoholic Beverages
• Market Cap 
• PE Ratio
• Dividend Yield – Sort from highest to lowest

Best liquor stocks in India – High EPS

Note: The list of liquor stocks listed in India based on the Earnings Per Share (EPS) is sorted using Tickertape Stock Screener on the date 4th April 2024. Below-listed filters are used to get the desired results. 

• Sector > Consumer Staples > Alcoholic Beverages
• Market Cap 
• PE Ratio
• 5-yr Historical EPS Growth – Set the lowest value to positive (zero) – Sort from highest to lowest

Top alcohol companies in India – Highest volume

Note: The list of liquor stocks listed in India based on the highest relative traded volume is sorted using Tickertape Stock Screener on the date 4th April 2024. Below-listed filters are used to get the desired results.

• Sector > Consumer Staples > Alcoholic Beverages
• Market Cap 
• PE Ratio
• Relative Volume – Set to high – Sort from highest to lowest

Overview of the liquor industry

The Indian alcohol market was valued at Rs. 2,807,236.7 bn in 2018 and is anticipated to reach Rs. 5,482,851.3 bn by the end of 2027, growing at a CAGR of 7.8% during the forecast period (2019 to 2027). This indicates that the Indian liquor industry is experiencing rapid growth, driven by factors such as the expanding middle class, urbanisation, and changing attitudes towards alcohol. Along with these factors, change in demographics is another major factor expected to foster the Indian alcohol market. For instance, the legal drinking age in India varies from state to state. For instance, 18 years in Goa, Uttar Pradesh and Karnataka, 21 in Tamil Nadu and Andhra Pradesh, and 25 in Maharashtra, Delhi, and Punjab. 

Moreover, the industry is segmented based on price, with premium and super-premium brands holding significant market share. However, it operates within a highly regulated environment, with state-specific rules and regulations governing the sale, distribution, and consumption of alcohol. State excise agencies play a crucial role in granting licences and levying taxes. Despite these regulations, the industry presents substantial growth opportunities due to the rising middle class and evolving consumer preferences.

Factors to consider before investing in liquor stocks in India

1. Regulatory Environment

The liquor industry in India is subject to various regulations and policies at both the central and state levels. Hence, the licensing and regulations imposed by the state government on liquor manufacturers and retailers are worth considering. Along with it, look at legal restrictions a company may face; familiarise yourself with limitations on advertising, distribution, and sale of alcoholic beverages, as these can impact a company’s profitability.

2. Market Dynamics

If you are planning to invest in the liquor industry, it is crucial to understand the market dynamics of the liquor industry to gauge the growth potential and competitive landscape. For this purpose, understand the consumption trends of alcoholic beverages in India, identify potential growth segments, evaluate the market size, projected growth rate, key players of the sector and their competitive analysis. 

3. Financial Performance

Assess the financial performance of liquor companies to evaluate their investment worthiness. Analyse a company’s revenue growth, profitability margins, and return on investment to gauge its financial stability and growth prospects. Evaluate the company’s debt-to-equity ratio and interest coverage ratio to determine its financial leverage and ability to manage debt obligations. Examine the company’s operating cash flow and free cash flow to assess its ability to generate sufficient cash for reinvestment and expansion.

4. Brand Strength and Portfolio

What a consumer feels about the brand is important. Hence, before investing in liquor stocks, assess the brand reputation, consumer loyalty, and market perception to gauge their competitive advantage. Moreover, evaluate the range and diversity of alcoholic beverages offered by a company, considering its ability to cater to various market segments and adapt to changing consumer preferences.

5. Corporate Governance 

While you are assessing brand reputation, you must also check if the company is adhering to corporate governance standards. You should review the company’s management team, board composition, and transparency in financial reporting. 

6. Sustainability

Knowing whether a company is against the environment or putting efforts into sustainability is important. Consider a company’s commitment to sustainability, responsible sourcing, and initiatives related to environmental conservation and community welfare before investing.

Conclusion

The Indian alcohol industry is one of the growing industries. Despite the regulations imposed by the government, the industry is growing at a CAGR of ~7-8%. But to thoroughly analyse every stock, use Tickertape’s Scorecard. It gives you a quantitative checklist with various scores such as performance, valuation, red flags, growth, profitability, and more to make quicker, data-backed conclusions on whether a stock is good to invest in or not. Moreover, these take the stock’s peers into consideration, so you know how a particular stock is faring in the industry. Interesting, isn’t it? Check out the Scorecard now!

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Anjali Chourasiya

I am a finance enthusiast who loves exploring the world of money through my lens. I’ve been dedicated to building systems that work and curating content that helps people learn.

As an insatiable reader and learner, I’ve spent the last two years exploring the world of finance. With my creative mind and curious spirit, I love making complex finance topics easy and fun for everyone to understand. Join me on my journey as we navigate the world of finance together!

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