April 28: Indian wine industry in its current Avatar, came into being in mid-1980’s through the pioneering efforts of late Shamrao Chougule, followed by Madhav Rao More, and Kanwal Grover in the 1990’s and has gone through several ups and downs but is currently ruled by Rajeev Samant, founder CEO of Sula Vineyards. But most wineries are still struggling with a few having bitten the dust. Subhash Arora has selected 10 wineries that showed excellent potential but nosedived and have either closed down or are gasping for oxygen
The list has been compiled based on my 25 years’ experience and direct contact with the industry and reflects my personal analysis. The wineries have been chosen generally in the order of their potential and branding, with due apologies to the owners, hoping they might still make a comeback:
1. Champagne Indage (Indage Vintners)
Once the uncontested market leader of the Indian wine industry and a darling of the Indian stock market that attracted the likes of Anil Ambani, this winery which put India on the world wine map with the Marquis de Pompadour and Omar Khayyam bubblies, unquestionably takes the top honours. The true pioneer and a visionary like Sham Chougule, founder of Champagne India (later Indage Vintners), who tasted success beyond imagination, had to bite the dust in the end. The only public limited wine company, which dreamt of becoming a world player, stretched its financial resources beyond imagination and was caught in its own web, eventually going bankrupt. Claiming to be a victim of the big meltdown in 2008-10, there is an overall consensus that it was poor management and buccaneer approach that brought it down.
Also Read : Ranjit Chougule’s Champagne House finally sold for Rs. 385 Cr.
Also Read : Resurrection of Indage Wine Labels in a New Avatar
Also Read : Blog: Indage Vintners is NOT Bankrupt
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Also Read : Editorial : Carry on Indage
According to insiders, the company had over-ambitious plans of overseas expansion and diversification. It went wrong because of inadequate analysis and none of the overseas expensive investments-including the Australian wineries Thachi (Tandou), Loxton and VineCrest and the two acquisitions in Europe delivered as expected. The downfall started in November 2008 and Indage never recovered, going bust.
Also Read : Viewpoint: Chateau Indage plans 1,000 wine retail outlets
The one plus point was that it trained several senior employees for the fledgling wine industry, who are now running their own wine businesses or holding senior positions in the industry. It also gave an opportunity to Sula Vineyards to lead the pack, never looking back.
2. ‘Champagne’ de Pimpane from Pimpalgaon
While many wine co-operatives in Italy, Spain and France have become dream success stories during the last century, Pimpane is the story of a failed co-operative in the Pimpalgaon village of Nashik District, which produced a Sparkling wine called Pimpane following the footsteps of Indage, using the traditional champagne-making technique.
Pimpane Co-operative India Ltd. was founded as a co-operative of 4500 members, with Madhav Rao More as its chairman, collaborating with the Champagne House Charbaut et Fils. in 1989. A prosperous local farmer, he felt humiliated when a visiting Frenchman told him in the early 1980’s that the table grapes of Pimpalgaon were not good enough for making wine. He wrote to 200 wine companies seeking assistance. Rene Chabraut of Chabraut & Fils showed up in March '87, and decided to back Moray.
Also Read : Blog: From our Archives- Indian Wine Industry in 1990's
The winery which had engaged Jean-Manuel Jacquinot, a Champagne winemaker. did export 6 containers of the bubbly before it was shut down due to technical, quality and financial problems. The stocks, winery and the lending banks were practically dormant till 2006 when the banks sold the unit under Securitization Act and Sula bought the unit reportedly for Rs.550 million. Sula eventually brought a majority of its fermenting capacity to this plant.
Thanks to pioneers like Chougule and Moray, the wine industry crossed an important threshold in the late 1980’s, demonstrating that good quality wines could be made from the grapes of Indian vineyards. With growing demand, fresh investments and improved know-how, Indian wineries finally came into their own in the 1990’s and early 2000’s, a century after the business was wiped out by phylloxera.
Pimpane may be dead and gone; but the octogenarian More who dreamt of selling wine at the price of a special cup of tea, lives in Pimpalgaon where his son runs a small winery.
Also Read : 'Champagne de Pimpane' to be 'born again' soon
3. Vinsura (Sankalp Winery)
When I attended Vinitaly in 2002 I met the Chairman and co-founder, Prahlad Khadangle, who was a farmer of good standing and was a part of the group visiting. I was very impressed by his viticultural knowledge and winemaking skill and harvest experience in France. Very hard working and passionate about wine, his dream was to surpass Sula because of his farming and viticultural background. He even named the winery as Sankalp Winery-which means ‘Resolve’- the resolve and determination to be the number one in industry.
The business was a union of 10 farmers, 4 out of which were the Directors of the company. The quality of wines produced was acceptable for the initial stage and the brand was on its way to recognition. But perhaps, it was an example of ‘too many cooks spoil the broth’, and a lack of appreciation of the marketing aspect and overall vision that led to its downfall. The winery held fort for the first few years and even engaged in management changes but there were ostensibly too many problems to resolve and it continued going downhill. Prahlad came back controlling his group but could not bring back the glory of its initial years after the damage was done.
Also Read : Vinsura to Play Sura de Vin
Today, the winery is gasping for breath, producing mostly Port wine and bulk wine-a far cry from surpassing Sula. The brand Vinsura has lost its brand recall value unfortunately but the management is hoping for ‘achhe din aayenge’.
Also Read : Vinsura also Enters Port Wine Business
4. Chateau D’Ori
This winery established in Dindori in 2005 was the brainchild of IT tycoon Ranjit Dhuru then running Aftek-a booming business in computer solutions. Ranjit is wine aficionado and collector of top French wines. He had bought land in the 1990’s and hired experts to grow high quality grapes. Not only did he drop the fruit for the first couple of years, he sold grapes off every year till he was sure he could make excellent wine himself. He set-up a state-of-the-art gravity-fed winery. A fanatic for Bordeaux and details, he had even the labels designed in Bordeaux. He started parallel wine imports from Bordeaux with private labeling, to set a benchmark for D’Ori wines. With the Chateau wines winning competitions, the quality soon became a real threat to the Top Three-Indage, Sula and Grover.
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Then came the unfortunate and sudden crash of his computer business – the shares that traded for over Rs. 80 a share came tumbling down to practically zero. Much needed capital to the wine business dried up and Chateau D’Ori was choking for finances and the winery was struggling for survival.
There were many who salivated to join him as partners but Ranjit refused to have any strategic or financial alliances and eventually his attitude resulted in the irretrievable downfall. Today, the premier winery is in a dilapidated condition and is barely surviving by selling bulk wine. Arrogance, pride and financial reasons are the reasons ascribed by industry experts.
The full time winemaker since inception. Kailash Dhuru works now as an independent consultant winemaker looking after D’Ori production as well. He says, ‘D’Ori may not be as active as it was in the past, but it is doing enough as a bulk wine supplier for now, producing around 5 lac liters. Ranjit is a fighter and hopefully we will be back on track soon.’
Also Read : Finewinesnmore Launches Chateau D'ori In Haryana
5. Alpine Winery
Another State-of-the Art winery with a fabulous potential and great future to become a leader in South India-not only in quality but also wine tourism was Alpine Winery that went down simply because of the family feud between the conservative father and progressive son, Raghavendra (Raghu) Gowda who had dreamt to first import and sell wines in Austria where he resides and visits the winery frequently.
Also Read : Stephane Derenoncourt: India’s Foremost French Connection
With a rich father, successful in liquor distribution business and with big chunks of land from Raghu’s maternal side, the plantation has a great expansion potential.
I had met the internationally renowned flying winemaker Stephane Derenoncourt in 2007-2008 in Vinexpo and then again in 2011 in Italy when he told me he was consulting with the winery. He had visited India a couple of times before even deciding to accept the project and was diligently involved – he had been 6 times when I met him again in 2011.
It appears Gowda has licked the wounds as he tells delWine, ’I am not looking for any customers (for the property). I have inherited Alpine and would never sell or merge without unlocking its value. Besides I got so many other options- even doing basic agriculture! Alpine is being revived after a big family settlement. I am now reviewing the kind of reinvestment and timeline it would take for the industry to bounce back. However It’s still going to take a while before you see some action on the ground.’
Also Read : Stéphane Derenoncourt-Man Behind Valley of Dreams
With the incredible state-of-the –art winery he had built and with a big tract of land, we wish him all the best to make a comeback.
6. Nilaya by Diageo
Diageo India entered the Indian wines segment with the launch of 'Nilaya,' in Goa in November 2007. It associated with Mountain View, Renaissance and Flamingo wineries in Nashik for producing the wine. The ‘Blue Heaven’ was launched in four flavours – Chenin Blanc, Sauvignon Blanc, Shiraz Rose and Shiraz Cabernet and priced between Rs 395(€7) and Rs 500 in retail. The bold looking label would be more appropriate for a Gin bottle but Diageo tried to convey the essence 'Blue Heaven'. With the launch Diageo planned to expand their canvas in the alcohol beverage industry in India, with wine being the fastest expanding segment.
Also Read : Diageo Launches Indian Wine
In the same year Diageo had launched their range of foreign mass selling labels like Blossom Hill, Barton & Guestier (B&G) and Piat d'Or in India. Before going on its own to enter the Indian wine market, Diageo had reportedly made overtures to Sula for a partnership deal that did not materialize. It did manage to sell the initial 15,000 cases in 2008, but repeat orders were scanty due to the quality and poor market positioning.
The fire and passion needed to market wines were perhaps lacking. The wine market pundits did not give this Indian label much of a chance of success in the very beginning.
In less than 20 months, the company closed the business, citing recession and reduction of wine business after a change in management. Asif Adil, the earlier managing director had introduced it with a lot of optimism, but left the company in a huff a few months earlier and the company took a loss.
Also Read : Diageo Quits Indian Wine Business
7. The Nine Hills (Indiosa) by Pernod Ricard
Nine Hills wines was launched in 2006 by Seagram India, the wholly owned subsidiary of Pernod Ricard.with 2 varietals each of Red-Cabernet Sauvignon and Shiraz, and White-Chenin Blanc and Sauvignon Blanc in Mumbai. Chenin Blanc was priced at Rs. 400 MRP (€ 7) while the other three varietals were tagged at Rs.450 (€ 8) thus competitively priced against the existing brands of Indage, Sula and Grover, the three top producers.
Also Read : Seagram India launches Nine Hills wines
The company erected a new winery in 2005, next to their distillation facility and crushed 150 tons of grapes and produced about 10,000 cases for their first harvest. The winery did not own any vineyard land and contracted with 21 grape farmers under their viticultural noses.
9 jean Manuel Jacquinot was appointed as the master winemaker from the Champagne Jacquinot & Fils. He had worked earlier in Pimpane. and was complimented for the ‘Best Cabernet Sauvignon’ in India.
Though the capacity was over 30,000 cases there was not enough visibility in the market as the liquor giant apparently did not find the market exciting. After reaching the production reportedly to around 30,000 cases, they pulled back and now close to under 10,000 cases of the new label Indiosa, according to our sources and are merely biding time.
8. Terroir India (Indus Winery)
Established in 2005, Indus Wines (Terroir India Wineries) formed mainly by Abhijit Kabir and Violet D’Souza where free gravity flow boutique winery with 150,000-liter capacity was established with help from the Kiwi expert, Dr Richard Smart. Due to the high costs of marketing and distribution, Indus supplied a portion of their wine made in bulk from grapes bought from the contracted farmers to Sula and other producers.
They teamed up in 2009 with Aspri Spirits as their distributor but the partnership was short-lived, though the wines labeled as Mumbaai Dreamz had chic labels of acceptable quality and under Rs. 300.They launched wines from French grapes- Shiraz, Cabernet Sauvignon, Chenin and Sauvignon Blanc etc.
Also Read : Mumbaai Dreamz of Terroir India
The market competition forced the winery to shift to produce C & C (Cheap and Cheerful) wines like ‘Goan Port’ at even lower prices-costing Rs. 110 for the Yeti Buzz, Sun Tiger Rs. 210 and Le Mor Rs. 280 (mostly with 16% alc.) selling in Maharashtra where they are exempt of excise duty. Violet D’Souza, a Director and one of the Indian Top Ten Women of Wines in 2013, says, ‘we are trying to live the Impossible Dream like many of our contemporaries, with the hope that someday we will make it happen! We are sustaining by producing lower priced wines and biding time till the market improves and perhaps we could then expand or wait for a strategic partner.
Also Read : WOW: Top Ten Women of Wine in India 2013 –Violet d’Souza of Terroir India
Also Read : Blog: Masterclass and Master of Wine about an Impossible Dream
8. ND Wines
When N.D. Wines of Nashik introduced 4 variants in the Delhi market in 2007, it created quite a buzz. Several grape farmers had entered the wine market during this time to make their mark. Priced between Rs. 340-490 the wines were ready to take on the established Indage and Sula brands. The visitors to their stand at the IFE International Wine Show at Pragati Maidan also showed interest.
Founded in 2003 by a group of farmers who had been making and exporting table grapes, it had diversified into wine grapes. The Founder Chairman Ashok Gaekwad had been exporting grapes since 1993 and was one of the biggest table grape growers in the Nashik region. The President of Maharashtra Grape Growers Association, he was exporting to supermarket chains in the UK, like Tesco and Sainsbury. He set aside 300 acres of vines growing wine grapes while 400 acres were reserved for table grapes.
Also Read : ND quartet launched in New Delhi
Out of a total planned production of 9 million Liters in 2008, 4 million were contracted for sale to Sula. 'This is our diversification move, as wine is becoming more popular,' said Manik Patil, a grape grower and one of the five Directors I met at their winery near Pimpalgaon in 2006-7.
When their marketing plans failed to materialize despite engaging the French winemaker Jean-Manuel Jacquinot, they were obliged to contract total production capacity to Sula. Today, they are known as a satellite winery for Sula Vineyards. Not having a marketing savvy organization behind the project is generally considered a big factor in their grandiose plans going awry.
Also Read : Indian Grape Exports Doubles in Three Years
9. Turning Point by Trinity vintners
There have been a few cases where the wine was produced by a known producer such as York Winery and marketed as a private label for those who owned the brand and excelled on better packaging or a novel marketing concept. But the concept was perhaps ahead of its time to be a success in the market (Indian consumers feel that the best prices and value wines are available only from the original producers).
Also Read : Launch: Turning Point for York Wines in Delhi
Thus Turning Point was promoted by late Ashwin Deo (former Managing Director of Moet Hennessy India) who developed sleek, beautiful sleeved bottles of wine, betting they would be the darling of the young millennials. He developed a following of loyal customers but did not have the wherewithal to scale up and market them for profit and did not have deep pockets to sustain and failed to make the project viable, even after launching in the Delhi market in 2012.
10. Good Earth Wines by Girish Mhatre
Good Earth was a virtual winery owned by a wine enthusiast Girish Mhatre, an IIT Mumbai alumnus now living in New York, who hoped his experience in Direct Marketing in the US would help him promote wine in India.
He bought select grapes and made wines in a rented winery assisted by the winemaker Rajesh Rasal. The ‘artisanal winery’ and attractive labels with marketing gimmicks like membership to the Concerto Club, a loyalty programme, were his USPs. The labels mirrored terms of Indian Classical music he loved- like Basso, Brio and Concerto.
Also Read : Get Set to Taste the Good Earth
delWine had expressed concerns in 2009 that wines priced at Rs.1450 for Basso, Rs.1375 for Brio seemed to be too high to sell high volumes consistently in the Indian market. But he did get the brands registered with the Indian Embassy in Washington DC as a wine supplier and it helped the brand image. Despite his optimism, the products failed to get enough traction and he shut shop.
He sold the Labels with all the Rights to Ashwin Rodrigues of Good Drop Cellars in 2015 at an undisclosed price. Rodrigues specializes in sparkling wines but balances his portfolio with still wines labeled from Good Earth and has kept a few of the labels alive and is about to introduce Taal, Aarohi and Taranga soon- selling about 1500 cases per month.
Also Read : Good Earth Winery Comes down to Earth
We have not included wineries like Four Seasons, Charosa and Myra Vineyards (which was getting them produced at Oakwood Winery in Shrirampur), which were making quality wines and selling significant numbers but had management/financial constraints and have been already sold to Grover Vineyards. The Article is written ‘Without Prejudice’ and based on our objective analysis and not in any particular order. If you are interested in investing in the winery business, you might want to check out for yourself the reasons why they were not successful before jumping into the fire. You may even be able to invest with the ones that are still alive-editor