Local Liquor Stocks Jump 18% on Govt Decision, Foreign Liquor Faces Steep Decline

Business News: In a dramatic shift for Maharashtra’s liquor industry, the state government’s new policy has sent indigenous liquor stocks soaring by 18%, while foreign liquor companies face sharp losses. Announced on June 10, 2025, the decision reshapes the market, favoring local producers and sparking intense debate.

A Boost for Local Producers

The policy aims to promote regional distilleries, leveraging Maharashtra’s agricultural resources like cashew and mahua. By reducing taxes on MML, the government expects to make local brands more competitive, appealing to cost-conscious consumers and boosting state revenue by an estimated ₹14,000 crore annually.

Foreign Liquor’s Downfall

In stark contrast, the policy imposes a hefty 50-60% excise duty hike on Indian-Made Foreign Liquor (IMFL) and premium imported brands, raising IMFL duties from three to 4.5 times the manufacturing cost. This has led to a steep decline in stocks of major players like United Spirits and Radico Khaitan, with shares dropping nearly 5%. The revised minimum retail prices—₹360 for premium foreign liquor and ₹205 for IMFL—make these brands less affordable, potentially shrinking their market share. Industry analysts predict a tough road ahead for foreign liquor companies as consumers pivot to cheaper local alternatives.

Market and Consumer Impact

The policy is reshaping consumer behavior, with local liquor brands gaining traction in bars and retail shops. However, critics argue the duty hike on IMFL could fuel black-market sales or smuggling from neighboring states with lower taxes. Retailers are bracing for a shift in demand, stocking up on MML brands to meet new consumer preferences.

A Controversial Move

While the government touts economic benefits, opposition leaders call the policy “anti-consumer,” arguing it burdens middle-class buyers. The surge in local liquor stocks reflects investor optimism, but the decline in foreign liquor shares highlights the challenges of balancing local interests with global competition. Maharashtra’s liquor market is at a crossroads, with long-term impacts still unfolding