Tag Archives: Craft Spirits

Maharashtra Made Liquor, Will it Disrupt the Trade?

Set to boost excise revenues, even while the government promotes local production
MML licensees assure that quality will be prioritized and will compete with mass market IMFL
Margins will be tight, and success depends on efficient distribution, strong marketing, and retailer participation.

The Maharashtra government’s decision to introduce a new category of liquor, Maharashtra Made Liquor (MML), is set to transform the state’s alcoholic beverage landscape while increasing excise revenues. Industry experts say the move represents both fiscal foresight and a push to empower local manufacturers.

The Maharashtra liquor market is no stranger to innovation, regulation, and disruption. The MML policy is seen as a strategic attempt to bridge the gap between low-end IMFL and country liquor.

The rationale was straightforward: while premium IMFL and imported spirits dominate the higher price points, many local manufacturers were either dormant or underutilized. The government saw an opportunity to revive these units, create employment, and increase excise revenues. The MML category, pegged at ₹148.50 to ₹205 for a 180 ml pack, was positioned as a bridge offering, designed to be more affordable than IMFL yet higher in quality than country liquor.

Beyond the price, the policy introduced a nuanced excise structure. While IMFL attracts 450% duty on manufacturing cost, MML would be taxed at 270%, providing a margin buffer for manufacturers and retailers. At the time of announcement, government officials projected an incremental revenue target of ₹14,000 crore, on top of the existing ₹25,000 crore excise intake. However, industry insiders remain cautious about whether these numbers are achievable, citing consumer behaviour, market fragmentation, and distribution challenges.

MML is going to redistribute market-share: Sadanand Bapat

According to Sadanand Bapat, Managing Director of Associated Blenders Pvt. Ltd., the new policy is a strategic reform that aligns revenue generation with industrial growth. “The government will definitely benefit with increased revenues, there are no two opinions on that,” said Bapat. “Even if MML doesn’t perform fully as expected, collections will still be higher than before. The estimated additional revenue is around ₹3,000 crore over and above existing excise collections.” Maharashtra’s excise revenue was ₹25,468 crores from April 2024 to March 2025.

Maharashtra’s IMFL market currently stands at around 30 lakh cases per month. Bapat estimates that once all MML producers become operational, the new segment could account for 8–10 lakh cases monthly, effectively redistributing a share of the existing market rather than creating an entirely new one.

“It’s not an additional market, it’s a redistribution,” he explained. “Out of the total 30 lakh cases, about 8–10 lakh will now fall under MML, and 20–22 lakh under IMFL. Naturally, some IMFL players are worried, but this policy also opens up opportunities for local manufacturers to compete and grow.”

Initially, about 15 licensees are expected to enter the MML space, though the industry anticipates that only five or six major players will eventually dominate. The market, experts believe, could stabilise once consumer acceptance grows.

Grain-based liquor

The MML category, notified under the state’s amended excise regime in June 2025, introduces a grain-based liquor segment that can only be produced by Maharashtra-based manufacturers. Each MML brand must be registered locally, and units must have at least 25% shareholding by state residents. The aim, officials say, is to revive underutilised potable liquor license (PLL) units, encourage local production, and create employment.

Under the new structure, MML will be treated as a distinct type of Indian Made Foreign Liquor (IMFL), but with a crucial difference. It must use rectified spirit produced within the state and will carry a lower excise burden.

As per the excise department, if the manufacturing cost of IMFL is up to ₹260/- per bulk litre, the excise duty is 450 % of the manufacturing cost or ₹750/- per proof litre whichever is higher. If the manufacturing cost exceeds ₹260/- per bulk litre, the duty is 300 % of the manufacturing cost.

Assuming a manufacturing cost of ₹400 per litre, IMFL would cost ₹2,200 (including ₹1,800 in excise), while MML would retail at about ₹1,480 (including ₹1,080 in excise). MML products will be priced between ₹148.50 and ₹205 per 180 ml bottle, making them far more affordable than comparable IMFL brands.

Consumer Outlook and Perception

A major factor in MML’s success will be how consumers perceive the new category. “Let me tell you, MML is nothing but IMFL — it’s the same thing,” Bapat stressed. “The only difference is pricing. Consumers can expect the same quality at a more affordable rate.”

MML will be sold only through licensed retail (FL-2) and hotel/restaurant (FL-3) outlets, not country liquor shops — ensuring quality control and regulatory oversight.

**Valsa Nair, Former Additional Chief Secretary, Government of Maharashtra**

The MML initiative stems from a report by a committee led by former Additional Chief Secretary Valsa Nair, formed in January 2025 under the Devendra Fadnavis-led government. The Cabinet approved the recommendations on June 10, followed by a government resolution outlining operational guidelines.

The move also revives an earlier attempt to promote grain-based distilleries dating back to 2007, which was shelved after legal challenges. This time, however, the government has built stronger structural safeguards and economic rationale.

Beyond revenues, the new policy ties into Maharashtra’s goal of boosting local manufacturing and employment. With over 70 licensed potable liquor units in the state, of which 22 are defunct and 16 operate only as retailers, the new framework could rejuvenate many idle facilities.

A Model for Other States?

While some observers see shades of Tamil Nadu’s and Rajasthan’s liquor models, Bapat believes Maharashtra’s approach is more innovative. “People say it’s a mix between Tamil Nadu and Rajasthan’s policies, improved to suit Maharashtra’s needs,” he said. “But this is a well-drafted, homegrown framework. If it succeeds, other states will surely follow.”

As MML hits retail shelves, its dual promise, to bolster government revenues and support local industry, is being closely watched. For now, optimism runs high among policymakers and producers alike.

“Everyone — from consumers to manufacturers to the government, is eagerly awaiting the results,” Bapat concluded. “It’s a big reform, and if implemented well, it will redefine Maharashtra’s liquor industry.”

New Avenue of Growth for Domestic Distilleries: Karan Kalani

Echoing similar views is Karan Kalani, Director of Deejay Distilleries Pvt Ltd. He believes that the policy is poised to transform the state’s spirits market, opening a new avenue of growth for domestic distilleries and offering a structured, quality-driven alternative to illicit and imported low-end products.

The new MML category will help the state achieve multiple objectives from curbing illegal inflows of liquor to improving consumer access and strengthening regional industry participation. “The new category will offer high-quality products on par with IMFL, but at a more affordable price point. This will curb illegal liquor entering from other states and give consumers a safe, reliable, and good-quality alternative,” Kalani said.

Market Realignment

“The affordability factor will drive this category. Earlier, consumers seeking lower-priced options had to depend on country liquor or unregulated sources. Now, with MML, they will have a legitimate, high-quality product,” Kalani noted.

The government currently earns around ₹25,000 crore in excise revenue, and expects an incremental ₹3,000 crore once MML stabilizes. Kalani believes this is achievable. “The revised duty structure has increased prices for popular IMFL brands like Imperial Blue, Royal Stag, and McDowell’s No.1. Simultaneously, MML will contribute significantly to revenue growth as production and distribution expand.”

Transition Phase, Not Chaos

While the market is witnessing a degree of flux following duty revisions, Kalani views this as part of a natural adjustment. “It’s not a chaotic situation—it’s a transition phase. The entire industry is undergoing realignment. In the next six to eight months, sales and consumer preferences will stabilize as new players enter the market and distribution strengthens across Maharashtra.”

He also observed that while some consumers are “downgrading” due to price increases in IMFL, the MML segment provides a quality downgrade option, far superior to illicit or country liquor, thus retaining consumers within the formal sector.

The MML policy is expected to give a strong growth impetus to regional distilleries, many of which previously found it difficult to compete with national or multinational brands. “This policy levels the playing field. Local distilleries now have a fair chance to grow within Maharashtra without having to battle MNCs directly,” said Kalani.

Kalani believes the trade will also benefit from the emergence of MML. “Retailers will find the segment attractive, selling a ₹150 product instead of ₹80 boosts turnover and income. Once availability improves, MML products will gain rapid acceptance across retail channels,” he said.

He also emphasized that each manufacturer will have flexibility in crafting their blends. “Every company will have its own recipe and style. Overall, the category will deliver a product at par with popular IMFL in terms of taste and quality,”

Kalani expects MML to record the highest growth rate in Maharashtra’s alcobev sector over the next year. “We expect initial sales of around 5 lakh cases, scaling up to 7–8 lakh cases as more producers come onstream. The first year will be about consolidation — experienced players will strengthen their presence, and the ecosystem will stabilize,” he concluded.

Marketing and Consumer Education will be Crucial: Vishal Jaiswal

According to Vishal Jaiswal & Vaibhav Jaiswal, Managing Directors of Konkan Agro Marine Industries and a senior industry observer, the policy has been carefully formulated after studying models in neighbouring states. The MML category is positioned between Indian Made Foreign Liquor (IMFL) and country liquor and targets the mid-market segment, offering better quality at affordable prices. “They wanted to increase the price of regular segments and at the same time offer an alternative. So, they decided to introduce a mid-segment category,” Jaiswal explained.

He added that the move is also part of a broader effort to revive the state’s manufacturing units. “Many units were shut for ages. The government was not getting any revenue from them. This policy aims to revive those units, create employment, and generate state income,” he said.

“The government has fixed the minimum segment price at ₹148.50. If we want to match the quality of existing IMFL products, the price has to be in the ₹160–₹180 range,” Jaiswal said. He emphasized that all MML products will be made from grain spirit, not molasses, ensuring a smoother and higher-quality profile. “Those who are brand-conscious and want to establish a reputation will definitely focus on quality,” he added.

However, Jaiswal also pointed out that marketing and consumer education will be crucial. “Manufacturers will have to invest in trials and awareness — to get consumers to taste and trust this new category. This is a holistic move, boosting quality, reviving industries, and strengthening the state’s revenue base,” Jaiswal summed up.

Fraught with challenges for distributors, retailers, and even some manufacturers: Pradeep Lulla

Giving a contrarian view is Pradeep Lulla, President of the Maharashtra Wine and Retailers Association. “When the MRP changed in June, a 180 ml whisky that cost ₹160 jumped to ₹220 — a 37.5% increase overnight. Distributors lost 3–4% margins instantly, and low-end consumers were priced out. Many shifted to country liquor, which saw a growth during that period.”

Lulla warns that the MML policy may not generate the initially projected ₹14,000 crore in incremental revenue. He predicts a modest increase of ₹1,000–2,000 crore, mainly due to consumer segmentation and brand loyalty.

“Consumers will not switch entirely from established IMFL brands. Some will reduce frequency, while others will revert to cheaper options. Retailers and distributors will adjust accordingly, cutting stock, rationalizing infrastructure, and tightening credit.”

He also flags distribution and consumer experience challenges. MML is restricted to Maharashtra, which fragments brand exposure. Travelers or consumers moving to other states won’t find their preferred MML brands, potentially eroding loyalty.

Lulla highlighted financial constraints. He said if the manufacturing cost for a 180 ml MML bottle is ₹21.43, the excise duty per bottle is going to be ₹57.86 and the cost of the 48-bottle case will be ₹2,777. “Margins will be tight, and success depends on efficient distribution, strong marketing, and retailer participation,” he says.

In short, MML could redefine Maharashtra’s liquor market. But whether it becomes a game-changer or a market correction remains to be seen. The coming months will test the policy’s design, the resilience of distributors, and the willingness of consumers to embrace a new mid-tier category.

‘Greater Than’ Brings Back Juniper Bomb

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Juniper Bomb, first created in 2020 when a power outage extended a batch of Greater Than’s botanical soak from 10 to nearly 36 hours, the resulting gin was unexpectedly bold, unapologetically juniper-forward, and instantly loved. Originally released as a limited edition, it has found a cult following among purists and has now joined Nao Spirits & Beverages’ permanent lineup. Compared to Greater Than, Juniper Bomb triples the juniper load, delivering a classic London Dry
style gin that is electric—like biting straight into a plump Juniper Berry. It’s bold and complex at first, with a finish of ripe lychees. Its gin designed for those who like their spirit loud and proud; best had with lots of ice and tonic, and no additional garnish, what the team calls ‘Make It Naked’. Commenting on the launch, Anand Virmani, Co-Founder & Master Distiller, Nao Spirits, said, “Juniper Bomb wasn’t part of the plan. It was literally born out of a mistake—but the kind you want to make twice. It packs a punch—just like the juniper that defines it. We like to think of it as a gin with the
volume turned all the way up.”

India’s First Homegrown Vermouth Launches in Bangalore

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After a successful debut in Goa, Davana Vermouth Indica – India’s first 100% homegrown vermouth, is now available in Bangalore. This expansion brings the brand’s expressions, Bianco and Rosso, to the garden city.

Davana is crafted using a Chenin Blanc wine base and infused with 21-23 native botanicals, including its namesake ‘Indian wormwood’ known as ‘davana’. Available in two distinct styles — Bianco, a light and floral blend with citrus and spice, and Rosso, a deep, spiced, and bittersweet offering — the brand presents an aperitif that’s versatile, elegant, and unmistakably Indian.

While vermouth has long held its place in cocktails like the Negroni, Martini, and Manhattan, it has rarely taken centre stage in Indian bars or conversations. Davana is looking to change that. The brand is not only looking to offer a local alternative to imported vermouths but also aims to educate consumers about vermouth as a category — as a pre-dinner ritual, a low-ABV sipping experience, and a key cocktail component.

Adarsh Gadvi, Co-Founder, Davana Vermouth Indica, says, “After Goa, we decided to bring Davana to a market that would spark conversations around vermouth. We’re excited to showcase a new generation of Indian spirits made for the world — but rooted at home.”

Founded by Adarsh Gadvi and Evgenii Savvateev, Davana took shape after over two years of development and more than 50 recipe trials. The bottle is a visual ode to India — adorned with intricate illustrations of lotus, peacocks, tigers, and the aromatic davana herb. The embossed Devanagari logo on the textured, cork-sealed bottle embodies bold design, artisanal craftsmanship.

Nao Spirits Bags Six Awards

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Nao Spirits & Beverages, India’s craft spirit maker, has further cemented its place on the global stage with its wins at The Gin Guide Awards 2025 (UK), one of the world’s most reputed competitions. With six awards, the homegrown brand has now crossed the 80+ international award milestone, emerging as India’s most awarded gin brand; well on its way to a historic century of global accolades.

Founded in 2017 by Anand Virmani, Aparajita Ninan and Vaibhav Singh; and later joined by Abhinav Rajput, Nao Spirits was born with a mission to create world-class Indian spirits that celebrate botanicals and showcase homegrown innovation. From starting as a small-batch distillery in Goa to now exporting to over 24 countries and commanding a quarter of India’s gin market, the brand has helped redefine how the world sees Indian craft spirits.

Nao Spirits’ winning expressions include their signature gins, Greater Than and Hapusa, as well as two of their limited editions, Broken Bat and No Sleep. The distillery is also the only Indian distillery to have been crowned one of the ‘Distilleries of the Year’ along with special mentions.

In its 11th year, The Gin Guide Awards (UK) is the world’s largest independent gin competition, judged by a diverse panel of distillers, retailers, mixologists, and distributors. It evaluates gins not only on flavour and balance, but also creativity, craftsmanship, and category leadership—making it one of the most comprehensive recognitions in the industry.

“We’re reimagining what Indian craft spirits can be; pushing boundaries with a constantly evolving portfolio that spans classic and contemporary expressions, and a pipeline of experimental editions. Innovation is at the heart of how we’re redefining the future of craft gins,”says Anand Virmani, Co-founder, Nao Spirits.

Earlier, Nao Spirits had won four ‘Best in Category’ awards, including a ‘Double Gold’ for Greater Than, at the San Francisco World Spirits Competition, and three category wins.

The awards are: Medal (Highly Commended) – Greater Than (Traditional Gin – Upto 42% category); Medal (Winner) – Greater Than Broken Bat (Traditional Gin – Aged Gin); Medal (Winner) – Greater Than No Sleep (Contemporary Gin); Medal (Special Mention) – Distillery of the Year; Medal (Winner) – Hapusa (Contemporary Gin – Over 42%); and Medal (Winner) – Hapusa (Cocktail Category – Negroni).

‘It’s cool working with Ranveer – He is dynamic, hatke and full of creative ideas’

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With a career spanning over three decades in the industry, Bikram Basu has been in different roles with different companies. An industry veteran who is now at the helm of affairs at ABD Maestro – ABD’s new subsidiary in collaboration with Bollywood actor Ranveer Singh. Ambrosia speak to Bikram Basu about the new venture, expectations and more. Excerpts:

Congratulations on your new role for ABD Maestro. Excited?

Thank you. My association with Ambrosia and INDSPIRIT has been for a couple of decades, and you’ll have been a part of this journey.

I am looking forward to this responsibility with keen interest as I’ve always enjoyed creating new things and this role gives a canvas beyond strategy and brands. The structure of the new organisation is unique, spanning multiple opportunities. I am sure there will be a few challenges on our way, but we have a mix of experience and fresh talent to navigate and overcome them.

Everyone’s jumping on the premium bandwagon.

How big is this market?

I’d rather take the pricing scope to be Super-Premium and Luxury spirits. That is where ABD Maestro is planning to play. We have considered brands for ABD Maestro that currently have an MRP above ₹2000 per 750ML or 700ML bottle in Maharashtra, irrespective of their consumer prices in other states. We know that the pricing index or ladder is mostly similar across states.

If we consider brands above ₹2000 and make it flavour agnostic, the segment was estimated at 4.8 million cases – prior to the pandemic in FY19/20. Post the pandemic, this grew to an estimated 7.2 million cases in FY21/22. And we feel this will close at early double digit million cases in FY24/25 – with early teens percentage growth. The Super Premium and Luxury segments by volume are estimated in mid-single digit salience of the industry, but the value salience and margins are significant. These are trends on why the industry has taken a view to participate better.

From appearing in ads, celebrities are now part of companies/brands, what kind of value do they bring?

Celebrities globally are icons of positive opinion and change. They have a following, some fanatical. These people have achieved superstar status through hard work and consistent success. Brands irrespective of industry will gravitate to using celebrities to build positioning, break clutter and push forward.

Ownership with celebrities of brands or equity in organisations globally have trended for the past many years. This has come to India a decade back with celebrities having equity in start-ups and bringing their success and following to the ventures. It’s a relatively newer thing in the Indian alcohol beverage industry.

Why do you think celebs are

finding this market lucrative to invest in?

Major Indian actors may be investing in alcohol beverage brands as they see the market premiumise and early-stage participation should give the first mover advantage. They are likely to also relate to super-premium and luxury brands better than mass market brands as owners or partners, as its part of their social and consumption set.

What’s Ranveer Singh role in ABD Maestro?

Ranveer Singh is a creative and business partner, with equity in ABD Maestro. He is not a brand ambassador or a celebrity endorser. Ranveer is fully involved in the creative ideation process and gives time and thought. It’s really cool working with him as he is dynamic, hatke and full of creative ideas – and he understands business.

Which brands will come under ABD Maestro and tell us the plans for each of these brands?

The brands which will be with ABD Maestro now are Arthaus Blended Malt Scotch Whisky, Zoya Special Batch Gin, the Fullarton acquired brands of Woodburns Indian Malt Whisky, Pumori Small Batch Gin and Segredo Aldeia Café and White Rums. The BIO portfolio has Russian Standard Vodka- Platinum, Gold and Original.

Therefore, at Maestro we will have a Blended Malt Scotch and Indian Malt Whisky, a Special Batch Gin, a Craft Gin, White and Café Rum and a top end global Vodka at three different price points. Too early to call out plans for each of the brands.

So a mix of owned, licensed and distributed brands?

The brands mentioned earlier are either licensed or distributed by Maestro. The organisation will also launch its own brands which will be owned.

You have said that “Maestro will be a consumer first business”, can you substantiate?

Yes, I do strongly believe that finally it’s about the consumer who buys you, and not what you want to sell. More so in F&B, of which alcohol beverage is an increasingly important part.

Anything which we eat and drink needs an approval for a repeat purchase. When a purchase behaviour is involved, having opinions is common. When we put the consumer first, the business of brands works at every level to deliver effectively. Standing out to be the ‘first among equals’ in a strongly regulated industry with limited outlet universe takes understanding of consumers and trends more than just analytics.

Which will be the focus markets within the country and also overseas for ABD Maestro?

The licensed and owned brands will focus on top urban markets in India initially. A few from the portfolio will also go overseas.

The MBA Thesis That Catapulted Indian Single Malt to the Global Stage

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The success story of Indian Single Malt (ISM) whisky in the global market place, pioneered by Bengaluru-based Amrut Distilleries, has been well documented. It is not only an interesting story, but also an inspiring one on how the Jagdales – father-son duo – the late Neelakanta Rao Jagdale and Rakshit Jagdale – hit upon the idea of making a breakthrough in the whisky landscape, dominated by Scotland.

Rakshit Jagdale, in a podcast ‘Expert Talk with Bhavya Desai’ recalls his student days at Newcastle University doing an intense one-year MBA programme. “It was a Sunday morning and I was strolling along Northumberland street, a busy shopping center in New Castle upon Tyne, when my father called up and asked what I was planning to do for my thesis. I said a theoretical project on supply chain management. He said ‘no, no… you should do a practical project’ and suggested ‘why don’t you check whether there is scope to sell Indian single malt whisky in Indian restaurants within Great Britain’ stating that Kingfisher and Cobra beers were quite popular in Indian restaurants there. My father asked me to check out whether there was demand for Indian single malt as an aperitif or a digestive. I said it’s a brilliant idea.”

Miniatures that captured the imagination

Neelakanta Rao Jagdale then sat down with the excise officials in Karnataka and had two cases of miniatures of single malt whisky sent over to New Castle. “It was in June when exams were going on. I went over to the Customs bond and duty paid and cleared one case. The packaging was very rudimentary with a black and white label with simple words ‘Amrut’. We knew our product was exceptionally good. The colour of the whisky was good, dark enough and natural. We don’t add any caramel, it is 100% natural. My father had sent 300 miniatures of 60 ml each in two boxes. It was a live project for the company. I did a lot of my survey in New Castle, Edinburgh in Scotland and in the Midlands. I visited several Indian restaurants and bars in Scotland and the response was amazing. Everybody liked it. Some said it’s a 10-year old whisky, some said its Irish, when I said it was Indian, it was a jaw dropping moment.”

On returning to India, Rakshit presented the project to the family board. “It took us two years to conform to the packaging standards of the European Union and on August 24, 2004, we launched Amrut in Café India in Glasgow. That is how the journey of Indian Single Malt whisky began.”

Making the Grade in Whisky Bible

Not to sit on these laurels, they set off on taking it to the world, creating Amrut Fusion which was next level to the Classic Indian Amrut. “Fusion is a completely different product. It is a combination of peated barley and unpeated barley, the former coming from Scotland and the unpeated from India. It is an 80:20 ratio. My father felt that as the Indian palate is accustomed to little bit of peat with Johnnie Walker Red Label and Black Label, they would like the combination. That was running in his mind.”

Explaining the process, Rakshit mentioned, “Fusion is matured for a longer period, five to five and a half years. The base malt, both peated and unpeated, is matured for four years and then we marry them and mature it again for nine months to one year, which gives it not only depth, but also complexity of flavours. When Jim Murray first savoured it in 2009 and found it unique and said there was no other product in the world that had this kind of combination. He loved Amrut and gave 97 of 100 in his Whisky Bible in 2010 and ranked it as the third finest whisky in the world.”

From humble beginnings in 1948 as a simple bottling company, Amrut is a name to reckon with. It moved on early into distillation and premiumisation and that has paid dividends. “We have reasonably come a long way. We have grown organically and we are happy with progress we have made.”

This is the third generation of the Jagdale family which is running the business, started by Radhakrishna Rao Jagdale in 1948. The fourth generation is getting ready and Rakshit mentions that ‘the time is right to discus with his son and niece to find out if they have any interest, prima facie, in carrying forward the rich legacy of my grandfather and father.”

Amrut Distilleries, Expanding Capacity and Eyeing Partnership in the Long Term

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In a podcast conversation with Bhavya Desai, Rakshit Jagdale, Managing Director of Amrut Distilleries, has spoken at length about the company’s expansion plans and the journey of how a practical project during his MBA days in the UK led to the first-ever launch of an Indian Single Malt whisky, charting a path which many others have followed subsequently, making India proud of its strides in the alcobev sector.

engaluru-based Amrut Distilleries, the firm that put Indian Single Malt whisky on the global map, is in an expansion mode. Beginning April 2025, Amrut Distilleries is adding 35% more to its distillation capacity, taking it from 900,000 litres to about 1.4 million litres, according to its Managing Director, Rakshit Jagdale. It was only in 2018, the company had trebled its distillation capacity.

`1,000 crores net sales target

Amrut Distilleries’ current business in volume terms is over 6.3 million cases per annum with turnover at ₹540 crores net sales, gross sales being ₹1,750 crores. “The projections are to touch ₹1,000 crores net sales in about 10 years’ time, growing at 10 to 15%. We are quite confident, we will sustain. For us bottom line is important. We can chase turnover with economy, but we want to have strong EBITDA. There is scope for luxury and premium segment to grow further and strengthen the bottom line.”

Dilution of stake

Asked whether the closely-held family concern would be diluting its stake, Jagdale said, “There has been a lot of interest in our group over the past six to seven years. We have had discussions at the family board level, but we have not taken that call yet. We cannot shy away for too long. We are looking at a partner who will add value to the brand and also give global market accessibility, if at all we go that way.” IPO (initial public offering) is another route which the company is looking at it from a long- term perspective. “We are not there as yet. I personally feel, it will be a couple of years more, before we take that call.”

Meanwhile, Amrut Distilleries is also exploring avenues to set up a new distillery to cater to the bulk market. “We are seriously looking at the bulk side, impending the Free Trade Agreement (FTA) with the United Kingdom.”

FTA and its impact

On whether there would be a downward revision in the prices of premium whisky in India, post FTA, Jagdale said, “It is certainly round the corner and it will post a fair bit of challenges. Brands like Glenfiddich, coming down from their current levels, will affect. We don’t know what is going to be their strategy, but they will put pressure on us to come down by ₹500 to ₹1,000 from what we are selling at currently. The bottomline will get compromised but we should stay put.” The shelves will have Indian single malts and BIO (bottled in origin) Scotch and consumer preferences around that point of time has to be factored in. “We have to wait and see.”

Weary of unhealthy competition

Stating that the Indian market offered massive opportunities, Jagdale mentioned, “Everybody wants to be in India now. They want to jump on Indian single malt bandwagon. They are serious and we are serious too on what we are doing.” Diageo has launched Godawan Indian single malt whisky, Pernod Ricard is setting up a single malt distillery and there are a host of Indian distillers, about five to seven of them, who will hit the market in the next two to three years. There is Ian Macleod coming. “Competition is most welcome and it keeps you on your toes, improves processes quickly and rapidly. Just hope that it doesn’t go the path of unhealthy competition.”

Amrut’s market focus

Giving details of its market bifurcation, Jagdale stated, “This year, of our total business is 95% domestic and 5% export market. Within the luxury division, we are 35% export and the rest domestic. “In the premium range, we have MaQintosh Premium whisky, Silver Edition whisky, Two Indies Rum, and Nilgiris Dry gin. The mass market category includes Amrut XXX rum, Prestige whisky, Silver Cup brandy. From a volume point of view, we would be 70% economy and from topline point of view 25% would be luxury and 10% would semi-premium and premium categories.”

Pain Points,
Excise Tops the List

Talking about excise duties, Jagdale said, “We are a highly regulated industry. Time has come to deregulate it. We are still following laws enacted by the British, while we have technology. There is a massive trust deficit between the government and the alcobev industry, hoping that the perception the governments have about the industry changes. Hopefully, it will have happen in my lifetime, would like to see that happen.” Agreeing that presently the governments are willing to listen to the industry and amend rules, he said, “there is hope.”

South Heavily Taxed

Jagdale stated that the southern states are highly taxed. “If you look at Punjab, Haryana and other northern states, the taxes are not as high as here. For instance, if the MRP (maximum retail price) is ₹100, the manufacturer gets roughly about ₹11, the retailer gets ₹9, the rest goes to the government. Agreed that the government has its own compulsions of running welfare programmes and other schemes, we appreciate that, but there has to be a balance going forward.” The governments, unlike earlier days are now open to dialogue which can only get positive, he hoped.

Is alcobev profitable business?

Quizzed about whether the alcobev sector is a profitable business, considering that it highly regulated, Jagdale’s advice is “Get into the premium and luxury segment. It is not worth to be in the mass market. You may achieve volumes in a couple of years, but you are not going to make any money. It takes minimum of four years, one should have the patience and the ability to invest for that long a time.”

His guestimate is that a 1000 litre per day plant will require a minimum capex investment of ₹25 crores and there would be working capital. “There is no guarantee that it will succeed in four years’ time. One should have the patience.” The route budding entrepreneurs could take is getting in gin manufacturing or matured rum category or vodka at the premium end. “Then you can pick up white, brown and dark spirits.”

The consumer of today

Emphasising the need to go premium, Jagdale explained that the present day consumer is highly discerning. “Globally we see a lot of youngsters have taken up to single malt whisky in a very big way, especially in the US, India, Europe. One thing we have observed with the advent of internet, is that the knowledge levels of the consumer has gone up significantly. Youngsters know more about whisky and other spirits much more. This keeps us on our toes. The consumer profile has changed. The younger generation is willing to spend more, drink better, drink less as they are health conscious too.”