Liquor Stocks Tumble as Maharashtra Hikes Excise Duty; Beer and Wine Makers Gain

Mumbai, June 11: Shares of major liquor companies witnessed a significant dip on Tuesday following the Maharashtra cabinet’s approval of a sharp hike in excise duties on Indian Made Foreign Liquor (IMFL) and country liquor. The policy overhaul, which also introduces a new category called Maharashtra-Made Liquor (MML), aims to boost the state’s annual excise revenue by ₹14,000 crore.

Stocks of United Spirits, Allied Blenders & Distillers, Radico Khaitan, and Tilaknagar Industries declined by as much as 5% due to anticipated pressure on margins and volumes caused by increased taxation. This marks the first excise duty revision in the state since 2011.

New Duty Structure and MML Introduction

Under the revised policy, the excise duty on IMFL has been raised to 4.5 times the cost of production—capped at ₹260 per bulk litre. The duty on country liquor has been increased from ₹180 to ₹205 per proof litre. The government has also fixed new minimum retail prices for 180 ml bottles:

• ₹80 for country liquor

• ₹148 for MML

• ₹205 for IMFL

• ₹360 for high-end foreign liquor

The new MML category, meant to promote local production, will be manufactured exclusively by Maharashtra-based producers and will require fresh registration with the excise department.

While spirits manufacturers saw declines, companies in the beer and wine segment saw a surge in their stock prices. G M Breweries soared by 18% to ₹845 per share, driven by expectations that the excise policy's focus on IMFL and country liquor would benefit beer consumption. Sula Vineyards and Som Distilleries & Breweries also gained, with share prices rising 11.3% and 4%, respectively.

G M Breweries, which holds a 25–30% share in Maharashtra’s country liquor market, could see revenue benefits despite the hike, due to its local manufacturing model. Sula Vineyards, a leader in India’s wine sector, stands to gain from the exemption of wine from the new duty hike. The company also operates two vineyard resorts in Nashik, further strengthening its foothold in the state.

Industry analysts note that while the higher duties could strain price-sensitive segments, the new MML category may open fresh avenues for local distillers. Meanwhile, companies aligned with beer and wine continue to attract investor interest, given their exemption from the tax hike and growing consumer preferences.

The Maharashtra government maintains that the excise duty update is a necessary step to augment state revenues without severely impacting consumer choices.