Nashik Vintners Pvt. Ltd., owner of the Sula wines will raise the private equity capital through the issue of new shares, says Rajeev Samant the founder CEO.
“Talks are on and a decision will be taken soon,” said Rajeev Samant, managing director. The equity divested will amount to a minority stake, he said according to Live Mint.
The company currently owns about 20% of the market share with the last year’s revenue of Rs.560 million. The total Indian wine market is estimated at Rs 2.5-4 billion. Its Sula brand is priced at Rs 450 and above, with the super premium wine Dindori selling as high as Rs.800 a bottled. The low end Samara brand does not use the Sula name on the label starts at only Rs 150 a bottle.
The strategy propped up the top line from Rs. 507 million in 2007-08 to Rs. 540 million last year but the profits before taxes dropped from Rs 90 million to Rs.18.5 million in 2008-09.
After a flat year 2009-2010 in which the volume sales growth was only around 10%, the company is expecting a growth of 45% this year with the target of 280,000 cases well within the reach of the company. Sula also plans to expand through acquisitions which ‘will be on the cards two years from now,’ according to Rajeev.
Whereas the sale of its premium brands was rather flat last fiscal year, the low end Samara introduced over a year ago helped the company increase the volumes and became the largest producer last year, overtaking the erstwhile leader Indage Vintners.
“We now plan to penetrate tier II cities with Samara,” said Samant who, indulging in some rhetoric, reportedly plans to open around 700 wine-tasting clubs across the country in places such as Punjab, Bihar and Assam. “These are places where people have no access to our wines.” delWine Could not reach Rajeev for his confirmation. |