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 Fratelli crossed 170,000 cases sales during the recently completed fiscal year 2016-17, even though the sales of Port wines sold as the Sidus label have been a relatively low 15%, according to Kapil Sekhri, Director of Fratelli Vineyards. This would place the sales of premium wines at 145000 cases, with Port selling merely around 26,000 cases. He adds that they make only Premium quality ports selling at around Rs, 200. Incidentally, Sidus won the Trophy as the Best Indian White Wine in the Budget category during the India Wine Awards held at Hotel Sofitel BKC in Mumbai last month.
According to Sumedh Sing Mandla, CEO of Grover Zampa Vineyards, it has maintained about 10% growth this year taking its sales to 210,800 cases (rounded off to 210,000 cases but out of this only 116,300 (say 116,000 cases) have been premium wines; the balance 94,500 being in the low-end Port segment-Red Lips Port Wine @16% alcohol, thus making over 44% of the total sales.
Sula Vineyards continue to lead with a sale of 10 million bottles. The company grew 15% in the premium sector but dropped 20% in sales of Port wine. With last year sales of Port wine estimated at 350,000 cases, the drop is significant at around 70,000 cases. ‘We are now more of a premium wine company says Rajeev Samant, fully aware that they are still 5 times the size of the next competitor (Grover Zampa).
Despite the leading position and the comfortable lead, Sula has recently expanded into whiskey production-they have already entered the grape brandy business with Janus label. Eclipse label for Indian whisky has been in producing in a small way. Sula Selections, their imported wine arm is also adding several labels to their import portfolio in order to make it a profitable venture on its own in the long term.
Four Seasons had a gradual uptrend crossing Seagram’s Nine Hills and reached its crescendo in 2012-13, the year Diageo bought the controlling stake of 51% in United Spirits Company (USL) , when it (barely) crossed the 100,000 mark, even though it included sizeable portion of Port wine when it claimed to be no. 2 producer ahead of Grover Zampa. This was also the time when the company lips became sealed because due the company policy of the parent company, employees are prohibited to make any statement and unlike most foreign companies there is no official spokesman and one has to depend on the market intelligence which often includes the company report deposited with the Registrar of Companies and anyone can have access to the documents by paying very nominal charges.
According to our market intelligence sources, the production and sales at Four Seasons took a dive in 2013-14 and the sales plummeted to around 40-50,000 cases by March 2015. DelWine even predicted that a sell-out of the winery was imminent. However , the winery recovered slightly and is estimated to have sold around 60-65,000 cases including an estimated 15-20,000 cases of Port wine , leaving 40-50,000 cases of Premium wines, ahead of Nine Hills estimated sales of 25,000-30,000 in 2016-17, coming down from an earlier peak of around 40,000 cases.
Owned by Pernod Ricard, Nine Hills does not appear to be sure which direction its masters would take it. More margins and market growth with fair amount of certainty in the liquor business and the dismal performance of wine segment due to the vacillating government policies shifting from bad to worse would be the dilemma faced by both these MNCs. York is another wine producer that has made good progress in premium wines but so far has been below 25,000 mark from where they can reach the next phase. But one thing in their favour is that they make only premium wines, so the wines produced by them add the number to total premium wine sales in India.
The overall growth of domestic wine industry is thus estimated to be only, (take a deep breath!) around 8-10% for the whole year. Despite very optimistic plans well executed, demonetization spoiled the party first and took a toll on sales. The SC ruling banning liquor service in the areas with 500 meters from the National Highways put another major dampner in the demand during March. The industry has still not been able to grapple with the situation and the piquant situation.
The Indian wine producers had predicted a growth of 15-20% for 2015-16 and were hopeful to achieve the target even though swimming against the current. But they hit a double whammy-first demonetization and then the SC500 episode-both dragging them back when they were left gasping for breath. They are still struggling to keep their feet firmly on the ground and any guesses for this year would be hazardous as they pray against any more tsunami hitting them this year- even if Fratelli is charging ahead as the number two premium wine producer in India.
Subhash Arora |