Shares of GM Breweries and Sula Vineyards surged as much as 18% and 13%, respectively, on 11 June, defying the broader selloff seen across liquor stocks. While peers such as United Spirits, Radico Khaitan, and Allied Blenders faced heavy selling pressure following the Maharashtra government’s sharp hike in excise duty on Indian Made Foreign Liquor (IMFL), GM Breweries and Sula Vineyards found favour among investors, thanks to specific positives linked to the policy shift.
The state government announced a revised excise duty structure, increasing the levy to 4.5 times the production cost, up from the earlier rate of three times. This revision is set to push the excise duty on country liquor to ₹205 per litre, up from ₹180. The increase is expected to be passed on to consumers, likely raising the maximum retail price (MRP) across liquor categories, a move that has sparked concerns over a potential dip in demand due to higher prices.
However, GM Breweries emerged as a potential beneficiary of the revised policy and the introduction of a new category, namely Maharashtra-made Liquor (MML).
Known for its stronghold in the Maharashtra-made liquor segment, the company is seen as well-positioned to absorb or benefit from the regulatory change swiftly and potentially expand its offerings under the new MML classification.
In its 2025 annual report, GM Breweries noted that, while detailed official data remains limited, figures from the State Excise Department indicate the company contributes approximately 25% to 30% of the total excise duty collected from country liquor across the state, underscoring its significant market presence.
Meanwhile, shares of Sula Vineyards also caught investor attention. Wine, as a category, was largely absent from the revised excise duty list, leading to optimism that Sula may escape the price hikes that are likely to affect other segments.
In addition to this, there is growing market chatter around a possible shift in consumer preferences from higher-priced spirits to wine and beer in response to the excise-driven price increases. This sentiment further fuelled the bullish outlook for both Sula Vineyards and GM Breweries, with investors anticipating a reshaping of alcohol consumption patterns in the state.
