NEW DELHI: Rising input costs and tighter state policies are reshaping India’s beer market, pushing smaller brewers to rethink their strategy. For Simba Beer maker Sona Beverages Pvt Ltd, the answer is clear: move up the value chain.
The company is doubling down on premium products while expanding selectively into large beer-consuming states, betting that higher-margin segments will offer more sustainable growth.
On the back of this shift, the nearly decade-old company expects to close the current financial year with sales of about four million cases, up 26-28% year-on-year, chief operating officer Ishwaraj Singh Bhatia told Mint.
In India’s fast-growing but tightly regulated beer market—dominated by three global brewers controlling about 80% of sales—smaller players face mounting cost pressures and limited pricing flexibility. Premiumization is emerging as a key strategy for these brewers to protect margins and expand.
Bhatia said the company expects healthy growth in line with or higher than the market average from its FY25 turnover of ₹400 crore, adding that the business has been profitable since its third year of operations.
The brewer currently operates at an Ebitda margin of around 20%, compared with 10-15% for listed beer companies, which are significantly larger in scale.
Cost pressures
The company’s growth comes even as beer makers grapple with rising packaging and logistics costs.
Bhatia said packaging accounts for nearly half the cost of production, particularly in cans and glass bottles, while the liquid itself contributes roughly 10-15% of the total cost.
These pressures are making the low-priced segment increasingly difficult for smaller brewers, he said.
Bhatia said the pricing playbook followed by Budweiser Magnum, owned by AB InBev, has reshaped how smaller brewers think about margins. Unlike several local brands that compete closely with economy beers, Budweiser entered India at a significantly higher price point and maintained that gap.
“They priced themselves ₹30-40 above the market from the day they came in,” Bhatia said, adding that this pricing discipline has helped the brand absorb rising production costs better than most players in the market.
“The economy segment is going to become tougher over the next few years,” Bhatia said. “State-led players dominate that category and policy changes can influence the market. For independent brands, the premium segment is where the economics work better.”
Market dynamics
India sold about 440 million cases of beer in calendar year 2025, according to the Brewers Association of India, a drinks advocacy body representing the country’s top three players, which control around 80% of beer sales by volume.
These are Dutch brewer Heineken, AB InBev, and Carlsberg (in no particular order), according to international drinks consultancy IWSR.
The remaining 20% of the market is dominated by smaller players such as Simba, Medusa, KatiPatang and BeeYoung, among others.
According to the Brewers Association, India is expected to sell about 450 million cases by FY27, with the sector projected to grow 7-8% annually over the long term.
Expansion push
Founded in 2016, Simba is currently present in about 12 states, with Delhi, Assam and Meghalaya among its largest markets.
The company plans to enter Uttar Pradesh, Madhya Pradesh and Andhra Pradesh from April, betting on strong beer consumption and rising demand for premium variants in these regions. The brewer expects these three states to together add about one million cases of annual volume over the next two years.
Simba currently operates brewing facilities in Assam and Meghalaya and relies on contract manufacturing in other states.
New tie-ups with breweries in Karnataka, Uttar Pradesh and Madhya Pradesh are aimed at reducing logistics costs and improving supply reliability.
Portfolio strategy
Strong continues to dominate the company’s portfolio, accounting for about 70% of its sales, while 30% comes from mainstream or premium variants.
Pricing strategy has also evolved in recent years. Rather than competing directly with economy brands such as Kingfisher, Simba positions several of its products closer to international premium labels like Budweiser Magnum, depending on the state market.
The company is also testing a new beer variant called Simba Wild, which will compete in the premium lager category once formally launched.
Bhatia said the disruption at beer maker , which has faced supply constraints in several markets over the past few months, has opened up some distribution opportunities for Simba, particularly in bars and restaurants.
However, he added that Bira “was never a strong competitor in the strong beer segment”, which accounts for the bulk of India’s beer consumption.
Beyond beer, Simba entered the spirits segment last year with ZigZag Vodka, currently available in Delhi, Goa and Bengaluru and priced between Smirnoff and Magic Moments. The brewer is also preparing to introduce an imported Irish whiskey later this year as part of its broader portfolio.