India cracks Smirnoff global top five: Diageo

BENGALURU: India has broken into the top five global markets for Smirnoff, driven by strong traction from flavour-led innovations such as Minty Jamun, Praveen Someshwar, chief executive of Diageo India, told analysts on Tuesday.“Smirnoff flavours, specifically Minty Jamun, have emerged as a breakthrough innovation, validating our India-first flavour strategy and becoming the primary growth engine for the trademark and the entire Whites portfolio,” Someshwar said, adding that the momentum has helped India break into Smirnoff’s top five markets globally.The comments came as the company reported what Someshwar described as a “resilient” October to December quarter, despite continued policy headwinds in Maharashtra. Excluding Maharashtra, Diageo India’s prestige-and-above portfolio recorded 6% volume growth during the quarter, while net sales value growth stood at 14%, he said.Adjusted for a one-time retail pipeline fill in Andhra Pradesh in the year-ago period, prestige-and-above volumes were flat for the quarter, Someshwar said. He added that the adverse volume impact in Maharashtra was largely concentrated at the lower end of the portfolio, which supported the national price mix at about 10% for the quarter. The company continues to see its historical 6-8% price-mix range as sustainable, he said, with recent traction at the top end of the portfolio.On Maharashtra, Someshwar said the launch of Maharashtra-made liquor at lower price points has intensified competition, particularly in the popular and lower-prestige segments. He said consumer acceptance has been strongest for the first brand to enter the category, with subsequent launches seeing lower traction. While some consumers are making trade-offs due to pricing differences, the company has stepped up its response by improving packet pricing, expanding pocket-pack offerings and increasing on-ground activation for brands such as McDowell’s and Royal Challenge.Looking ahead, Someshwar said Diageo India remains cautiously optimistic on demand, citing early signs of improved disposable income and festive-season consumption, while continuing to track regulatory developments closely. He also said the benefits of the India-UK free trade agreement, once approved, are expected to start reflecting in the company’s numbers from the July to September quarter due to existing inventory cycles.