With extensive experience in India’s alco-bev industry, Arundeep Singla, Chairman & Managing Director of Alcostar Group of Companies, has been instrumental in building premium brands and driving innovation in the sector. In an exclusive interview with Asmita Mukherjee, Singla shares his insights on evolving consumer preferences, premiumisation trends, hospitality partnerships, and the future growth of the alco-bev market in India.
How is the alco-bev segment evolving from being an add-on revenue stream to becoming a key profitability driver for hotels and restaurants?
The alco-bev segment is no longer seen as a secondary support category for hospitality businesses. In hotels, restaurants, lounges, and experiential dining formats, it has developed into one of the most potent profitability generators. Consumers today are prepared to pay more for personalised beverage experiences, premium pours, and social consumption situations, which naturally boosts margins for hospitality businesses. The intent of consumers has changed dramatically. People no longer just order a drink; they invest in an experience, a mood, and a way of life. This change has made it possible for hospitality companies to develop unique beverage-led layouts that increase revenue per table and enhance customer retention. Beverage innovation and premiumisation will remain key components of India’s Hospitality profitability structure in the future.
What major consumption trends are you currently seeing across India’s hospitality sector, especially in premium and experiential drinking formats?
India’s alco-bev consumer is transforming rapidly, particularly in urban and rising aspirational markets. We are witnessing a significant movement toward premium and experience-based consumption. Consumers are growing increasingly conscious of quality, brand identity, ingredients, presentation, and the whole social experience associated with drinking events.
Premium whiskies, cleaner vodkas, inventive cocktails, and lifestyle-focused beverage forms are in high demand. Brands that can emotionally connect with consumers through aspiration, authenticity, and modern positioning are gaining ground.
At Alcostar Group, we are observing that younger consumers particularly prefer brands that offer both quality and identity. This is one of the reasons premium portfolios such as Sherry Platinum Whisky and KIEV Vodka are aligning well with evolving market preferences.
Another prominent trend is the emergence of experiential hospitality, where music, ambience, mixology, and storytelling are valued equally along with the product itself.
Licensing regulations and pricing controls continue to be major industry concerns. How do you see policy challenges impacting growth for alco-bev brands and hospitality businesses alike?
The alcohol and beverage industry in India works in one of the most challenging regulatory regimes, and policy variation across states continues to be a key concern for both brands and hospitality firms.
Taxation structures, licensing frameworks, pricing stipulations, and route-to-market rules are frequently changed, which has a direct impact on long-term planning, investments, and market expansion strategies.
However, India is also one of the world’s fastest-growing consumer marketplaces, and the future prospects are incredibly promising. More stable and growth-orientated policies that foster responsible corporate expansion, investment, innovation, and organised sector growth would be highly beneficial to the industry.
A progressive regulatory framework will support not only alcoholic beverage industries, but also tourism, hospitality, employment opportunities, and state revenue.
How is Alcostar Group collaborating with hotels, restaurants, and bars to create stronger beverage-led experiences and sustainable revenue opportunities?
At Alcostar Group, we consider brand building much more than just shelf presence or menu placement. We believe that creating experiences that people truly connect with and remember is the key to long-term growth. Consumers today seek businesses that seamlessly integrate into their lifestyle, social interactions, and entire hospitality experience.
To create more captivating and immersive brand experiences, we are collaborating alongside hotels, pubs, restaurants, and other hospitality partners. The focus is on developing meaningful customer relationships rather than merely presenting products.
As the hospitality industry evolves, these collaborations will become increasingly more crucial in developing aspirational alco-bev brands in India. Authenticity, experiences, and cultural relevance are valued by consumers today, and we think hospitality-led partnerships will be crucial in fostering long-term brand loyalty in the years to come.
With rising operational costs across the hospitality sector, how significantly are beverage margins contributing towards overall F&B profitability today?
Beverage margins are becoming more essential for hospitality businesses, particularly as operational expenditures, rentals, staffing expenses, and food input costs continue to rise.
In comparison to other food categories, beverage programmes generally offer greater margin flexibility and upselling potential. Additionally, premium beverage formats raise average consumer spending without proportionately raising operational complexity.
In order to boost overall F&B profitability and improve client satisfaction at the same time, many hospitality operators today are strategically utilising beverage innovation and premiumisation.
This is one of the reasons why alco-bev partnerships are becoming more paramount than ever in hospitality strategy.
How do you see tier 2 and tier 3 markets shaping the future growth of premium alco-bev consumption in India’s hospitality landscape?
Tier 2 and tier 3 markets will be one of the most prominent growth drivers for India’s premium alcohol business over the coming decade.
Aspiration levels in these markets have soared considerably. Consumers are more exposed, digitally connected, brand-conscious, and willing to experiment premium lifestyle experiences. Hospitality infrastructure in growing cities is also rapidly upgrading, driving up demand for high-quality beverage products.
What’s particularly fascinating is that premium consumption is no longer confined to metropolitan regions. Premium whisky and vodka categories are experiencing tremendous popularity in emerging markets, as consumers increasingly link premium brands with lifestyle advancement and social prestige.
From a business perspective, what strategies should hotels and restaurants adopt to build stronger beverage-led revenue models while maintaining guest experience and profitability?
Beverage programs in hospitality must be approached strategically rather than merely operationally. When there is a clear focus on consumer experience, premium positioning, and innovation, beverage-led revenue models improve.
Hotels and restaurants should invest in curated beverage menus, employee training, mixology-led experiences, premium pairings, and brand collaborations to promote consumer engagement.
Understanding customer behaviour through data and occasion-based buying patterns is just as crucial. The next stage of growth will be defined by personalisation and experience-based hospitality.
Businesses that offer destinations and experiences, rather than just outlets, will thrive in the future. Innovation in the beverage industry will be fundamental to this evolutionary change.
