Drinks Giants: Diageo, Pernod, AB InBev, Heineken — 2026-09-05
Pernod Ricard faces continued investor skepticism with its stock sliding below €70 as it pivots toward India to offset weakness in the US and China. Meanwhile, global beverage alcohol volumes continue their three-year decline, with spirits identified as the worst-performing category by IWSR data.
Drinks Giants: Diageo, Pernod, AB InBev, Heineken — 2026-09-05
Top developments
Pernod Ricard Stock Slides as Investors Reassess Spirits Demand
Pernod Ricard’s share price has extended a weekly slide, dropping close to 9% as investors digest full-year figures showing net sales down 3.9% to approximately £8.1bn. The decline follows management's decision to cut full-year guidance, citing persistent weakness in the US and Chinese markets. Analysts note that the group is now emphasizing cost management over strategic ruptures, with the stock trading below €70 amid broader sector uncertainty.
Pernod Ricard Turns to India as Key Markets Flounder
CEO Alexandre Ricard confirmed that India has overtaken China as Pernod Ricard’s second-largest market, marking a significant geographic shift in the company's growth strategy. The firm is currently considering an IPO for its Indian operations to capitalize on this emerging strength while traditional markets in the West struggle with high interest rates and changing consumption habits. This move highlights the industry's broader trend of diversifying away from saturated US and European markets.
Global Alcohol Volumes Hit Three-Year Low
New data from IWSR confirms that total beverage alcohol (TBA) volumes fell by 2% in 2025, representing a drop of roughly 500 million nine-litre cases and marking the third consecutive annual decline. Spirits were identified as the worst-performing category, suffering the biggest value drop, while beer and wine also contracted. This structural shift in consumption patterns continues to pressure balance sheets across major producers like Diageo and AB InBev.
Tariff Threats Rattle EU Exporters
European exporters are expressing alarm over potential US tariffs, with threats of a 30% import tariff cited as "untenable" for industries ranging from Irish whiskey to Italian cheese. The trade friction adds another layer of complexity to an already challenging environment for spirits makers who have been grappling with destocking issues in North America. While specific retaliation plans have fluctuated, the mere threat of tariffs continues to suppress sentiment in the sector.
Local view
French financial outlet Investir notes that the "turning point of rigor" is accentuating at Pernod Ricard, with management focusing heavily on efficiency as demand remains sluggish in key markets like the US and China. Capital.fr describes the current stock performance as a "hangover of the century" but suggests that long-term investors may see value if the company successfully executes its cost-cutting measures.
Context & numbers
- Pernod Ricard Net Sales: Declined 3.9% to approx. £8.1bn for the full year.
- Global TBA Volume: Down 2% in 2025 (approx. 500 million 9L cases).
- Pernod Ricard Stock: Trading below €70, down ~9% week-on-week.
On the radar
- Pernod Ricard India IPO: Watch for official announcements regarding the potential listing of Indian operations, which could unlock significant shareholder value.
- US-EU Trade Talks: Monitor any developments regarding threatened tariffs on European wine and spirits, which could impact margins for exporters like LVMH and Pernod Ricard.
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