Value contribution from India will keep rising on back of premiumisation: Diageo

Bengaluru, Sep 5 (PTI) Spirits major Diageo expects value contribution from India, already among its top three markets globally, will keep rising on the back of its premiumisation strategy but doubling topline by 2030 will depend on macroeconomic factors and policy stability, according to the company's India MD & CEO Praveen Someshwar.

India, which is a “key growth market” for Diageo, is “cautiously optimistic” about mid-term growth, where it is operating with a playbook of premiumisation, productivity, and revenue growth management interventions, he said.

“If I look at the next five years, our guidance has been double-digit P&A growth (premium & above). We see that comfortably coming through. We see that our margins are expanding,” Someshwar said in a media roundtable here.

Diageo, which operates in India with brands including Johnnie Walker, Black & White, Smirnoff and McDowell, has a revenue of Rs 26,780 crore for the financial year ended on March 31, 2025.

When asked about India's contribution to Diageo's global revenue, he said, “India is already among the top three markets for Diageo globally, and a key growth market for Diageo Plc…With premium and luxury contributing to over a third of our NSV, our value contribution will keep rising.” Someshwar further said,“We are one of the largest markets for the Johnnie Walker trademark in Diageo, and within this, the largest market for Johnnie Walker Blonde. We are also the highest-selling market for Black & White primary scotch.” Diageo, which had a double-digit CAGR growth in its net sales value from the last five years in the P&A segment is going to invest back in the business.

“Innovation is the single biggest investment. People are the second area of investment,” said Someshwar.

As per its strategy, Diageo in India is now focusing on three cohorts of consumers - Aspiring, Middle/Mainstream stream and affluent.

Diageo India, which owns three over Rs 1,000 crore brands - Johnnie Walker, McDowell's No1, and Smirnoff and some over Rs 500 crore brands as Signature and Royal Challenge - is reshaping its portfolio based on - consumer occasions, premiumisation and innovation.

“Our runway is strong, 100 million new LDA (Legal Drinking Age) consumers in five years, rising repertoire drinking, and a robust innovation engine,” he said. However, when asked whether Diageo would double its topline in next five years by 2030, Someshwar said it ”will depend on macros and policy stability.” “That said, our focus continues to be outpacing the category with a sharp focus on consumers, value growth through richer mix, sharper execution and sustained brand and innovation investments. Growing our P&A business at sustained double digits ahead of the category remains our foremost priority,” Someshwar said.

Diageo India had lost the crown of the number one player in the Indian alchoBev market to Pernod Ricard India, part of French spirits makers in FY24, as it had sold its 32 brands to Inbrew Beverages, as per its strategy to focus on premiumisation.

When asked if the company is hopeful to regain the slot, Someshwar said ”Our core trademarks are accelerating, scotch recruitment is widening, and white spirits are scaling.

“With premiumisation, innovation, productivity, and revenue growth management as levers of our virtuous growth cycle flywheel, we’re confident of strengthening our portfolio and position in the coming years,” he added. PTI KRH RKL DR DR DR