Japanese drinks group Suntory Holdings has said the company's India division could make up 20% of its sales in the “long run”, and 10-15% in the next few years.
Speaking to US business news channel CNBC on Monday (8 July), CEO Takeshi Niinami said the Indian market could form a fifth of company sales within a decade due to the country’s strong “appetite” for spirits.
Suntory Holdings has a “long-term” objective of reaching $1bn revenue in India, it confirmed today (10 July).
It follows the establishment of a local subsidiary, Suntory India Private Limited, in June. The Haryana-based team begun working on 1 July to explore potential expansion opportunities for Suntory Holdings in the country, mainly for its soft-drinks and wellness brands.
Suntory India sits under Suntory Holdings and is a separate entity to Suntory Global Spirits in India - though the two share offices. Suntory India is headed by Suntory Holdings veteran, Masashi Matsumura.
Last month, Niinami said: “India is a remarkably attractive market and a key geopolitical player on the global stage, with strong cultural and economic ties with Africa, the Middle East, and Asia.
“Together with our spirits business, Suntory Global Spirits, we will enhance our presence as a multifaceted beverage company in this vital market by supporting our soft drinks and health and wellness businesses to build foundations in India through investments and partnerships.”
Suntory is looking for a local manufacturing partner in India to increase its footprint in the country’s spirits market as well as exporting to Africa, the Middle East and other Asian countries, Niinami told CNBC.
He said the region “will be a big hub” for the group moving forward. However, for the next few years Suntory India’s focus will be on domestic growth.
Asked how significant a proportion India will form of overall revenue mix, Niinami said Suntory’s goal is to have “more than 10%”, which could rise to 20% within a decade.
“We have a strong ambition with a passion for India,” he said. “The India market is always asking something new. Their appetite is a lot so we'd like to change our posture to be able to work with the fast pace of India. So I can’t tell you right now [how significant], but [it will be] more than that double-digit, of course.”
Last year, Suntory Global Spirits, then-Beam Suntory, launched a clutch of products in India: Yamazaki 12 single malt whisky, two flavours of its Jim Beam bourbon, Japanese vodka Haku and an unnamed “super premium” Tequila brand.
In an interview with local publication The Hindu Business Line, Ruchika Gupta, then-marketing director for Beam Suntory India (who left the business in May this year), touted the opportunity for further premiumisation in India.
