Liquor stocks in low spirits as bars, clubs shut amid coronavirus outbreak

Fearing community transmission of coronavirus due to mass gathering, states like Maharashtra, Karnataka, and Delhi have ordered shutdown of malls, bars, and restaurants as precautionary measure

Stocks of alcoholic beverage companies including United Spirits, United Breweries, and Globus Spirits plunged up to 16 per cent on the National Stock Exchange (NSE) on Thursday as state governments across the country order complete shut down of malls, bars, restaurants, and night clubs till March 31 in the wake of coronavirus (Covid-19) outbreak.

Individually, United Spirits plunged the most, down 16 per cent on the NSE, followed by GM Spirits (13.17 per cent), and Globus Spirits (10 per cent). Besides, Radico Khaitan slipped 7 per cent, United Spirits (5.6 per cent), Pioneer Distilleries (5 per cent), and Associated Alcohol and Breweries (4.8 per cent). Among these, United Spirits, United Breweries, Pioneer Distilleries, Globus Spirits, and GM Breweries all hit their respective 52-week lows of Ras 476.45, Rs 749.5, Rs 95, Rs 64.65, and Rs 240, respectively.  In comparison, the benchmark Nifty50 was down 457 points, or 5.4 per cent, at 8,011.40 level. 

Fearing spread of coronavirus due to mass gathering, states like Tamil Nadu, Maharashtra, Karnataka, and Delhi have ordered shutdown of malls, bars, and restaurants as precautionary measures till March 31 in selective cities. Further, various governments have also ordered that wedding halls and resorts must not take fresh bookings until further orders and that sports arenas, clubs and other recreational facilities should remain shut.

The latest to join the bandwagon is the state government of Haryana that has ordered shut down of bars in Gurugram till the end of the month. The order issued by deputy commissioner, Gurugram that the operations of gymnasium, swimming pools, spas, nighclubs, lounges, bars, cinema halls, theatres, multiplexes and all weekly bazaars, and shopping malls have been suspended till March 31.

As a result, restaurants are seeing 40 per cent decline in customer footfall. “This figure could go up to 80% with more coronavirus cases likely to be reported in India,” said Gurbaxish Singh Kohli, vice-president of Federation of Hotel & Restaurant Associations of India (FHRAI)

The top eight cities of India have 126 malls, according to Anarock Retail, a Gurugram-based real estate services company. Among Maharashtra, Karnataka, Delhi, Uttar Pradesh, Andhra Pradesh, Tamil Nadu and Kerala, Maharashtra and Karnataka have the largest presence of hotels and restaurants.

The number of Covid-19 cases in India saw a steep spike on Thursday, with the total number of positive cases touching 169. With 46 patients, Maharashtra has the highest number of coronavirus cases in the country. The worldwide number of cases has reached over 219,240, and there have so far been over 8,967 reported deaths across 157 countries.