Japan’s Suntory eyes 10-15% stake in Allied Blenders as whisky giant deepens India play

MUMBAI: Japan’s Suntory Holdings could be raising a glass to a bigger India play. The beverage major is in early discussions to acquire a minority stake in Allied Blenders and Distillers, the maker of Officer’s Choice whisky, according to an Economic Times report.

The discussions are centred on a potential strategic partnership that could bring together Suntory’s premium international spirits portfolio and Allied Blenders’ scale in India’s mass and mid-premium segments.

Allied Blenders could dilute around 10 to 15 per cent of its equity as part of the proposed transaction. Suntory is also evaluating potential distribution and manufacturing synergies with the Indian spirits maker.

The potential investment would give Suntory a larger presence in India’s mass whisky market, where the Japanese company remains relatively smaller compared with its premium spirits business.

Allied Blenders, controlled by promoter Kishore Chhabria, is India’s third-largest listed spirits maker. The Mumbai-based company has a market capitalisation of around Rs 20,000 crore and operates 38 manufacturing units. It raised Rs 1,500 crore through its initial public offering in 2024.

The proposed transaction is expected to be largely primary in nature, with the promoters potentially diluting part of their holding to bring Suntory on board. The ET report also said the promoters could consider ceding a majority stake to the Japanese company over the longer term, although the discussions remain at an early stage.

The development comes shortly after Bina Kishore Chhabria, a promoter of Allied Blenders and Distillers, sold a 1.96 per cent stake in the company for Rs 357.6 crore through an open-market transaction.

The sale came a day after the company disclosed that a promoter planned to sell shares to meet minimum public shareholding requirements. Following the transaction, Bina Chhabria’s holding fell to 56.24 per cent from 58.20 per cent, while the combined holding of promoters and promoter-group entities declined to 78.95 per cent from 80.91 per cent.

The stake sale and the reported discussions with Suntory are separate developments, with the latter still at a preliminary stage.

Suntory, considered the world’s third-largest distiller, has been looking to narrow the gap with global spirits majors Diageo and Pernod Ricard in India.

The company currently generates around $150 million in annual sales from the country, according to the ET report. India is the world’s largest whisky market by volume, with sales of around 260 million cases in 2025.

Diageo and Pernod Ricard both count India among their largest markets, with the country ranking first by volume and second by value for the two companies.

Suntory has an established presence in India’s premium spirits segment through brands including Yamazaki, Hibiki, Toki and Jim Beam. Its India-made Oaksmith whisky targets the mass and mid-premium categories, while the company also owns Scotch whisky brand Teacher’s.

The Japanese spirits maker has around 95 per cent of India’s Japanese whisky segment and about 44 per cent of the American whiskey category, according to the ET report.

Suntory operates a manufacturing plant in Rajasthan and works with third-party bottling facilities in Goa, Maharashtra, Madhya Pradesh and Telangana.

The company established Suntory India around two years ago to explore opportunities across beverages and wellness. It has also previously explored acquisitions in India’s spirits market.

Last year, Suntory was reported to have held discussions to acquire Imperial Blue from Pernod Ricard. Those talks, however, did not progress after the parties differed over valuation, according to people familiar with the matter cited in the ET report.

If the Allied Blenders discussions progress, the partnership could give Suntory access to a significantly broader domestic distribution footprint while offering Allied Blenders a potential route to strengthen its premium portfolio and manufacturing capabilities.

For now, however, the proposed stake sale remains under discussion, with the size, structure and longer-term ownership implications yet to be finalised.