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 The
Indian alcoholic beverage industry is a little over US$ 10
billion (Rs.45,000 crore) but the wine industry is valued at 100
million US$, a clear indicator of the scope of the Indian wine
industry currently growing at 30 per cent, fuelled by strong
growth in the domestic wine consumption.
Traditionally a whisky market, Indian wine makers are making a
determined effort to convert the nasha loving Indians to enjoy
the finer aspects of wine. Wine has been made in India for many
thousands of years, some say for 5,000 and even more. Today
India has 123,000 acres of vineyards, but only 8,000 acres are
used for wine grapes.
India wine consumption is expected to grow to around two million
cases a year by 2011, according to market watchers. Mr. Jaideep
Kale, technical coordinator at the Maharashtra Wine Park, had
declared in a recent report had reportedly commented, ‘the
consumption of foreign wines in the country for the last seven
years has increased by a mere 400,000 litres compared to an
astounding 6 million litres growth for domestic wine in the same
period. However, India ranks a lowly 77 in terms of wine
consumption in the world, according to a IWSR study.
Exports of Indian wines are also growing. “Maharashtra exports
5.5 lakh litres of wine annually. It was only 2.74 lakh litres
in 2003-04,” according to Kale By comparison, American vintners
shipped 217 million cases to domestic markets in 2007 and
another 50 million cases overseas.
However average per capita wine consumption is only 1 teaspoon
or 6 millilitres per year (compared with 375 millilitres in
China and 10 litres in the United States) one can hardly
exaggerate India’s wine market potential. Although much of the
Indian population will not enter the market any time soon, the
consuming class on its own could reach 300 million people, the
equivalent of the entire U.S. population.
The state of Maharashtra accounts for 90 per cent of India’s
wine production, but it is being expanded to other parts of the
country. From 2001 to now, 59 wineries have come up in
Maharashtra. There are 8,000 acres dedicated for wine
cultivation,” says Kale. This year alone witnessed seven
wineries being set up in the state. The industry is not very
capital intensive, as it requires around Rs.10-15 million to
setup a wine plant with a capacity of 100,000 litres.
The big three- Indage, Sula and Grover have achieved an average
of over 30% and with the new wineries springing up and having
triple-figure jumps in revenues over the small base, 40% is
perhaps a conservative estimate.
In growth terms an IWSR Report, 2006, noted that the wine
industry in India was growing at 25-30% annually as compared to
the 7-8% growth in China and 2-3% worldwide. Across India, out-of
home
consumption is on the rise, which is important for the wine
industry. Pubs, bars, restaurants and five-star hotels are the
primary wine selling outlets with 63% of sales volume coming
from these channels. states a Rabobank report.
But compared to the rest of Asia, the percentage of wine
consumption in India is still low. IWSR 2006 reported that
‘India accounted for 0.8% of the total wine consumption in Asia
as compared to China, which accounts for more than 62.7% market
share’. More than 80% consumption remains confine to metros –
Mumbai 39%, Delhi 23%, Bangalore 9% and Goa 9%.
How does India compare with other wine regions of the world in
terms of climate and soil? Nashik (in western Maharashtra) and
Sangli (in South West Maharashtra) are the major wine regions in
Maharashtra. The Nashik Valley, 2,000 feet abova sea level, and
Sangli, though not adjacent to each other, are both extremely
suitable for growing grapes. Monsoon rains, rich fertile soil
and cool climate makes them the ideal choice for the location of
vineyards. Chateau Indage is located at Narayangaon outside
Pune. The land and climate are just like California: cool nights
and sunny days, plenty of rain, cold winters and good iron-rich
soil.
Bangalore, south west of Karnataka known for its cool climate,
the same factor is also attracting huge investments in
vineyards, by both domestic and international players. The
winery for Grover, the third largest wine producer of India, is
in Dodballapur, 2000 ft above sea level.
 Himachal
valleys (Himachal Pradesh): The only north India wine producing
region, it is approximately at the same latitude as of the US
grape growing regions like south California and north Florida
wine grape growing region, though the style is generally
regarded as closer to French wines. The temperature are usually
moderate though they vary from 32°C in plains -15° C in
mountainous areas. Known for its fruit production, wine has been
added to the list of premium produce for the area. Apple, plum
and pear wine are popular apart from grape wine, while
strawberry wine was also recently launched.
Indian wineries have to cope with challenges that do not exist
in wine regions elsewhere. For starters, the calendar is turned
upside down. Even though the region is north of the equator,
grapes are pruned in September and picked in February and March
to avoid stifling heat and the summer monsoon season.
On the plus side, the vintners can plan to harvest according to
the ripeness of their grapes, without having to worry about
unseasonal cold snaps and rain.
Vineyards in Maharashtra produce well-known grape varieties such
as chardonnay, sauvignon blanc, cabernet sauvignon, syrah and
pinot noir but also include Indian varieties such as arkesham
and arkavati.
Besides the big three Indian wine companies, Indage, Sula and
Grover, major global players have recently jumped into the fray
which include the likes of Seagram India Ltd., United Spirits
and Diageo India Ltd.. All three with their deep pockets could
spur the growth of the wine industry.
Indage is in the process of setting up around 5000 wine bars and
wine shops which we aim to complete in the next 5 years. Says
Ranjit Chougule, “We have already allocated Rs. 40 cr. for this
venture and plan to increase this investment to Rs. 1,000 cr.
over the next 2-3 years. Our target is to sell 4-5 million
litres of wine through this retail venture in the next two
years.
For Grover, growth rates have also been high and steady.
According to Kapil Grover, “We are targeting a growth rate of 30
% year on year. So, Indeed, yes, there has been a good growth in
the sales and we are hopeful of making big profits year by
year.”
Over little more than a year, Seagrams India, owned by French
parent company Ricard Pernod, launched Nine Hills;
Bangalore based United Brewery began selling Zinzi and Diageo
with its Nilaya label.
If only the big boys of the liquor industry could repeat their
success in the wine industry. In value terms the Indian liquor
market is said to be around 45,000 crores as compared to the
wine industry which is around 400 crores. There are about 200
million Indian whisky drinkers and around 700,000 wine drinkers.
Indian winemakers face a significant challenge gaining a
foothold in this country where alcohol is still largely frowned
upon for religious and cultural reasons, and many of those who
do drink — nearly all men — are just fine with their
whisky-and-sodas.
But winemakers of all sizes, from international spirits giants
to mom-and-pop home brewers, see huge potential in India’s
booming market. Many urban women are drinking like never before.
To see how high wine has risen in the country’s esteem, look to
Bollywood. Just 10 years ago, an actress would only drink
onscreen to signal her character’s loose morals. But several
recent films have shown superstar actresses coquettishly
drinking wine as an indication of their elegance, not their
trashiness. If only they begin promoting wine like the male
actors who used to promote whisky, India could see Indian wine
consumption rocket to dizzy heights.
To read this section in detail and access
interviews of Ranjit Chaugule, Kapil Grover, Ashok Gaikwad,
Yatin Patil subscribe to Ambrosia:
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