Liquor stocks decline as AIADMK leads in assembly election in Tamil Nadu

Shares of seven liquor makers fell by 0.2% to 5.43% at 15:25 IST on BSE as trends for the assembly election in Tamil Nadu showed that the All India Anna Dravida Munnetra Kazhagam was set to retain power in the state.

Empee Distilleries (down 5.43%), United Spirits (down 3.49%), Khoday India (down 2.61%), Radico Khaitan (down 1.84%), Tilaknagar Industries (down 0.61%), G M Breweries (down 0.32%) and Associated Alcohols & Breweries (down 0.2%), edged lower. United Breweries (up 0.70%) and Pioneer Distilleries (up 4.98%) edged higher.

The S&P BSE Sensex was down 326.72 points, or 1.27% at 25,377.89.

All India Anna Dravida Munnetra Kazhagam (AIADMK) supremo and Tamil Nadu Chief Minister J Jayalalithaa has announced a phased liquor prohibition in the state if re-elected to power.

Meanwhile, another factor that is spooking investors is the talk of Maharashtra cutting water supply to distilleries and breweries. In April 2016, the Aurangabad bench of Bombay high court asked the Maharashtra government to cut water supply to distilleries and breweries in Aurangabad by 60% from 10 May 2016. The court asked the state to also cut supply to other industrial units in Marathwada by 25% after 10 May 2016. These water cuts will be effective till 27 June 2016, the court said. The court was hearing a petition filed by Aurangabad-based social activists and lawyers.

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