Liquor tops sales at Indian airports

Mumbai:Liquor is the favourite attraction for passengers shopping at duty-free outlets at Indian airports. Liquor sales at Indian airports are almost four times the global average in terms of percentage share. A retail report by  an aviation analysis and research body says that wines and spirits comprise 63% of the total international dutyfree sales at Indian airports.      This is in sharp contrast to the international trend where alcohol comprises only 17% of the total duty free sales. In India, after liquor, perfumes are most favoured. Indian duty-free less than 1% of global market  Mumbai: According to a recent report by the Center for Asia Pacific Aviation (CAPA), retail has been the main factor in pushing up non-aeronautical revenue at big international airports like Mumbai and Delhi. While the number of passengers has grown phenomenally, the growth in nonaeronautical revenue has gone up by more than 300% in the past five to six years. The retail  attraction for Indian fliers remains duty free liquor. Revenue from retail is now pitched to grow by 20-25% every year, with airports expanding their retail area and scope.      "Demand for duty-free liquor is strong. This could be due to the availability of premium brands at lower-than -market prices," said Kapil Kaul, CEO, Indian subcontinent and Middle East, CAPA. "While liquor remains popular, passengers are also opening up to other items like fragrances, food and clothes," he added. But other items are way behind liquor as of now.      Although the non-aeronautical revenue at major Indian airports is growing, it still lags globally. According to the CAPA report, the global duty-free market was around $23 billion in 2010. Duty-free sales in India amount to only around $215 million, which is less than 1% of total revenue. Compare this to Dubai, which reported sales of $1.46 billion from duty-free in 2011. All Chinese airports registered a combined revenue of $1.9 billion.      "This is mainly because Indian airports started late on building retail infrastructure. After a sustained effort for five to seven years, Mumbai and Delhi airports can boast of an almost 50% revenue from nonaeronautical sources. Other airports are way behind," said an independent analyst. "Nonaeronautical revenue is necessary for airports as it maintains a balance between the revenue from airlines and retail. This keeps the airport operator from charging airlines heavily to make up for operational costs," he added.      In India, Delhi makes the most revenue from duty-free ($72.7 million in 2011) followed by Mumbai ($60.6 million). "Delhi has the luxury of space and with the T3 being operational, retail has become a big part of the airport. Once the new terminal at Mumbai opens, retail revenue would be much higher," said Kaul. According to CAPA, revenue from duty-free went up by 400% in the last five years in Delhi. In Mumbai, it went up by 542%. "But Mumbai started at a lower base of $9.4 million, whereas Delhi already had $14.3 million revenue from duty free-retail," said Kaul. "Both will utilize their retail potential better in the next five years," he added.  2011 DUTY-FREE SALES  • Delhi: $72.7mn  • Mumbai: $60.6mn  • Bangalore: $17mn  • Hyderabad: $6.3mn