Sula Vineyards enters TN; slowdown impacts wine makers

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Chennai, Feb 8 (IANS) Indian wine maker Sula Vineyards has entered the lucrative Tamil Nadu market with initial supply of about 100,000 bottles to the state liquor retail monopoly Tamil Nadu State Marketing Corporation (TASMAC), said a top official.

He said the economic slowdown had impacted the 2.5 million cases Indian wine industry with lower growth rates and the market is now moving towards savouring red wine which is considered masculine.

Sula Vineyards would close this fiscal selling about ten lakh cases similar to 2018-19 but with a higher turnover as the focus is on premium offerings.

“We are beginning with the initial supply of 8,000 cases or about 100,000 bottles of 750 ml of red and white wines to seed the market. Chennai is the last place we are entering in the country. We are present in all the major cities,” Rajeev Samant, CEO, Sula Vineyards, told IANS.

The Sula brands will be the first national brand to be retailed by Tasmac. The wine brands from Sula will be retailed through Tasmac’s Elite liquor outlets here.

Samant said the economic slowdown had affected the industry’s sales in FY19 with the growth rate thinning down to single digit from double digit.

On Sula Vineyards part, its topline will be registering a growth on a reduced wine volume sales as the focus has changed to selling higher priced — Rs 850-Rs 1,500 — varieties.

“We were in Rs 200 to Rs 2,000 per bottle segment. We didn’t want to be in the Rs 200-Rs 500 bottle segment. Though it will give volumes, the cost-benefit ratio was not favourable,” Samant said.

Speaking about the market trend, Samanth said there is a change in the consumption style with wine getting finished first if it is good. Earlier it was other liquor that used to be finished first at corporate events and others.

“The market is moving towards red wine. Wine consumption in India will be about two per cent of the total liquor consumption,” Samanth said.

He said the Indian wine market is about two million cases of which about 1.7 million cases are from domestic manufacturers and the balance 250,000 cases are imported.

Though exports accounts five per cent of Sula’s sales, Samant said it is a challenging market as India is not a globally known wine market.

–IANS

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