Liquor Stocks Fall By 5% As Maharashtra Cabinet Approves Higher Excise Duties & New Liquor Category

Liquor Stocks Fall By 5% As Maharashtra Cabinet Approves Higher Excise Duties & New Liquor Category

Liquor companies' shares fell sharply due to Maharashtra's excise duty hike on IMFL and country liquor, impacting United Spirits, Allied Blenders, and Radico Khaitan. In contrast, Sula Vineyards and G.M. Breweries benefitted from exemptions for beer and wine, aiming to increase excise revenue.

Manasi KambleUpdated: Wednesday, June 11, 2025, 11:51 AM IST
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Mumbai: Shares of liquor companies dropped sharply after the Maharashtra government's excise duty hike on IMFL and country liquor, affecting United Spirits, Allied Blenders, and Radico Khaitan significantly. In contrast, Sula Vineyards and G.M. Breweries rose due to their beer and wine sectors being exempt from the hike. This overhaul aims to boost the annual excise revenue by ₹14,000 crore, with the introduction of Maharashtra-Made Liquor focusing on local production.

On June 11, liquor stocks like Allied Blenders & Distillers, United Spirits, Radico Khaitan, and Tilaknagar Industries experienced considerable selling pressure, dropping by as much as 5%. This decrease was driven by the Maharashtra cabinet's endorsement of modifications to the excise policy, which included higher excise duties on Indian Made Foreign Liquor (IMFL), country liquor, and imported beverages, as well as the launch of a new Maharashtra Made Liquor (MML) category.

The update signifies the first change in excise duty since 2011, increasing the duty on IMFL to 4.5 times the cost of production (up to ₹260 for each bulk litre) and raising the duty on country liquor from ₹180 to ₹205 per proof litre. The updated minimum retail prices for 180 ml bottles are fixed at ₹80 for country liquor, ₹148 for MML, ₹205 for IMFL, and ₹360 for high-end foreign liquor. MML will be created exclusively by local producers needing new registrations.

On the other hand, shares of G M Breweries, Sula Vineyards, and Som Distilleries & Breweries rose due to hopes that the liquor duty increase would positively impact beer and wine sales, with G M Breweries seeing an 18% rise to 845 per share.

Sula and Som achieved increases of 11.3% and 4%, respectively. G M Breweries, mainly centered on country liquor, accounts for about 25-30% of Maharashtra's excise duty on country liquor. Sula Vineyards holds a strong presence in Maharashtra, managing two vineyard resorts in Nashik, boosting its market standing. In general, while a few companies are struggling, some in the liquor industry are flourishing with the recent regulatory shifts.

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