2. Both the Indian wine market and the indigenous wine industry are in their nascent stages, but
growing by leaps and bounds
Domestic wine market is currently estimated at Rs 450 crore
More than 38 wineries are presently operating in the country with a total production of 6.2
million liters annually
◦ Expected to touch around nine million litres by 2010
◦ Maharashtra is leading among the states with 35 wineries and 5.4 million liter production
◦ Further, over 1,500 acres of grapes are under cultivation for wine production in India (1000
hectares in Maharastra alone- mostly in Nasik, which is increasingly being referred to as the
Napa valley of India)
7.62 lacs wine cases were sold in 2007 including 46,000 cases of sparkling wines
◦ The country also imports 72,000 wine cases in a year (mainly by ITDC, Sansula, Brindco, E & J
Gallo and other private companies) where 32,000 cases are bottled in origin and
remaining 0.36 m litres are imported in bulk flexi bags and subsequently bottled by Indian
wineries.
◦ Besides this, about 12,000 –15,000 wine cases are sold through gray market
◦ Estimated to reach 2.8 million cases in the next five years
The wine industry has witnessed a 30% annual growth rate mainly fuelled by the strong growth
in the domestic wine consumption
Its further projected to grow at more than 25 % annually in the next decade, making it the
fastest growing Indian industry
- Rajni Ranjan 2
3. The per capita consumption in India is only 9 ml per year as against 60-70 litres in France and
Italy, 25 litres in US and 20 litres in Australia and even China has 0.4 litre
◦ Eighty percent of wine consumption in the country is confined in major cities such as Mumbai
(39%), Delhi (23%), Bangalore (9%) and Goa (9%)
The most popular red varieties in cultivation are Shiraz, Cabernet Sauvignon, Pinot Noir and
Merlot
The most popular white wine grapes are Chenin Blanc, Sauvignon Blanc, Ugni
Blanc, Viognier, Chardonnay
There are about 25 Indian wine companies besides the big ones, producing and supplying wines
in small and medium levels, from 5,000 cases to 10,000 cases
The industry is dominated by three players viz. Indage, Sula wines and Grover wines and enjoys
more than 90% of the total market share
Key Growth Drivers are:
◦ Government support in the shape of reduced taxes, Easing of tariff barriers and liberalized
licensing requirements for the wines
Maharashtra has exempted wine manufacturers from excise duty to promote the industry
◦ Changing drinking habits of Indians and Changing lifestyles
◦ Higher disposable incomes
◦ Growth in the foreign tourists
-- 3Rajni Ranjan
4. There is a strong growth in the imported wine market with Indian importers importing hundreds
of brands from countries like Australia, US to Bulgaria.
◦ Some of the well-known brands available in India are Moet and Hennessey, E&J Gallo and
HWWG
Grape growing is a highly capital intensive project, concerted efforts are required to reduce the
rate of interest to 6 or 7% from the present 10-13%
The key raw materials such as grapes, bottles, and corks account for approximately 20% of the
total costs and are higher than the international norms
Industry is under pressure for profits due to high marketing costs and low volumes
Poor storage and transport facilities inspite of tropical climate are the main problems of wine
marketing in the country.
◦ Other constraints are the lack of promotional activities for wine consumption in the country
and unfavorable rules for domestic marketing of wines except in few states like
Maharashtra, Goa and Karnataka
◦ Some of the states like, Delhi, Rajasthan, Goa, and Chennai etc. do not allow sale of imported
wine
Exports currently make up about 10-15 per cent of total output. Wine is exported to
France, Italy, Germany, USA, New York, U.K. and Singapore
-- 4Rajni Ranjan
5. Table Wines, Sparkling Wine, Dessert Wines, Fortified Wines
(port, Sherry, Marsala, Madeira, etc or aromatic wines like
Vermouth, Dubonnet, Lillet, Cynar, etc.) are the major types of Indian wine
◦ Table wines account for 85 % of the market and expensive varieties of vintage wines
account for the remaining 15 per cent
West India accounts for over 41 per cent of total volume sales of wine in India, followed
by North India, which accounts for 29 per cent of volume sales
Around 63 % of the volume sales of wine are through off-trade channel in five-star
hotels, pubs and bar-restaurants
-- 5Rajni Ranjan
6. Nasik Region (Maharashtra State)
◦ Location: Western India, Nasik Valley is 2000 ft. above sea level between 19-33’ to 20-53’
North latitude and 73-16’ to 75-6’ East longitude.
◦ Sangli Region (Maharashtra State)
Location: South West Maharashtra; Latitude 16-52’ North, and Longitude 74-36’ east
Both of these regions are extremely good for growing grapes due to their
monsoon rains, rich fertile soil and cool climate. Most of the Indian Wineries are
located in these two regions including the largest Indage and Sula Vineyards.
Bangalore region (Karnataka State)
◦ Location: South West, Latitude: 12- 8' North. Longitude: 77-37' East
◦ Apart from being nation‟s IT capital Bangalore because of its cool climate is suitable
for grapes. Grover, the third largest wine producer of India, has its winery situated in
Dodballapur, 2000 ft above sea level, 45 km North of Bangalore
Himachal region (Himachal Pradesh)
◦ Location: 30-22’ to 33-12’ North Latitude and 75-47’ to 79-04’ East Longitude
◦ This region lies in the northern India and is at the same latitude as of the South
Californian, Texas and north Florida wine grape growing region
◦ Though this region is well known for apples and cider some good wine is produced
here
◦ Temperature varies from 39° C in plains during summer - 20° C in the Alpine Zone during
winters. Rainfall varies from 152 cms to 178 cms in outer Himalayas
-- 6Rajni Ranjan
7. D'Ori Winery with investments of approx. Rs 50 crore is all set for production by the end of this
year. The company is setting up a 600-tonne winery producing 6.5 lakh bottles in the first year
Sula, which claims a value market share of 20 per cent, is in expansion mode with its new one
million-litre winery set to commence production in March. This would take the company's total
capacity to 1.8 million litres
Private equity interest in the wine industry is sky-high at present. Singapore-based Arisaig
Partners' private equity fund recently picked up close to 10 per cent stake in Champagne
Indage, the country's largest wine maker.
Grover Vineyards too is reported to be in talks to offload about 35 per cent stake to a foreign
equity fund
Vinsura Vineyards is expanding capacity at its winery by 3 lakh litres this year to 4.5 lakh litres.
Liquor major Seagram has decided to hit the wine market. Seagram will initially start with a
capacity of 1 lakh litres and may emerge as the largest player in the domestic market
-- 7Rajni Ranjan
8. The alcoholic beverages sector being a State subject States/ UTs frame their own policies and
taxation regime
Wines can be imported into a Customs Bonded Warehouse as no licence is required
Thereafter, goods can move either duty free (against a licence from hotels) or duty paid to
licence holders after paying the relevant customs duties.
All additional custom duties (ACD) on wine have been withdrawn
The basic duty on the other hand has been increased from 100 to 150% (upper limit allowed by
WTO)
As expected, the increase in basic duties proved a boon to the Indian wine producers who
derived a tremendous price advantage.
India under immense pressure from EU and US wine manufacturing lobby after being dragged
in front of WTO for levying ACDs and state excise duties has waived off the additional duties
Recently supermarkets have been freed to sell wine
◦ Government has allowed supermarkets and convenience stores to stock “milder” forms of
alcoholic drinks such as wine and beer
◦ But the store would need to obtain a separate license fee for beer and wine and be subject
to regular inspections by the excise department
◦ Moreover, the beer and wine section will have to be separate with a different access as the
regular customers (many of whom are housewives) may not like to go near the alcoholic
beverages outlet
-- 8Rajni Ranjan
9. Importing of wine in India
◦ There is a strong growth in the imported wine market with Indian
importers importing hundreds of brands from countries like
Australia, Italy, France, UK, US, Chile to Bulgaria
◦ ITDC, Sansula, Brindco & E&J Gallo predominate the imported wine section
◦ International companies in India:
Veuve Cliquot has tie-up with Grover Vineyards / Country Rep
Miguel Torres (Spain) have JV with Thapar Group
E & J Gallo (USA) tied-up with Radico Khaitan
BRL Hardy (Aust) - JV for BIO distribution with Indage
-- 9Rajni Ranjan
10. -- 10
Commodity: 2204 WINE OF FRSH GRAPES INCLDG FORTIFIED WINESGRAPE MUST OTHR THN THAT OF
HDNG NO 2009
S.No.
HS
Code
Commodity
2005-
2006
%Sha
re
2006-
2007
%Sha
re
%Gro
wth
HS
Cod
e
digit
level
optio
n
1 220410 SPARKLING WINE 0.27 0.000
2
0.47 0.000
3
73 8
2 220421 WINE OF FRSH GRAPES(OTHR THN SPRKLNG WINE)GRAPE MUST WTH
FRMNTATN ARSTD BY THE ADDTNOF ALCOHL IN CONTNRS HOLDNG 2
LTRS/LESS
1.79 0.001
2
1.31 0.000
7
-26.81 8
3 220429 WINE OF FRESH GRAPES(EXCL SPARKLING WINE);GRAPE MUST WTH
FRMNTATN ARSTD BY THE ADDTNOF ALCOHL IN CONTNRS HOLDNG
EXCS 2 LTRS
7.33 0.004
9
8.7 0.004
7
18.79 8
4 220430 OTHER GRAPE MUST 0.08 0.000
1
0.13 0.000
1
72.75 8
Total 2204 WINE OF FRSH GRAPES INCLDG FORTIFIED WINESGRAPE MUST OTHR
THN THAT OF HDNG NO 2009
9.46 0.006
3
10.61 0.005
7
12.17
India's Total Import
149,16
5.73
185,7
49.30 24.53
Exchange rate:
2005-2006: 1US$ = Rs. 44.2735
2006-2007 : 1US$ = Rs. 45.2495
Value in US $
Million
Rajni Ranjan
11. Country Values in US$ Million 2005 -
06
France 4.41
Australia 1.38
Italy 1.15
USA 0.51
Germany 0.32
UK 0.28
Chile 0.26
South Africa 0.19
Spain 0.18
UAE 0.18
Country Values in US$ Million 2006 -
07
France 3.95
Italy 1.45
Australia 1.19
USA 0.79
UK 0.73
Belgium 0.69
Argentina 0.3
Chile 0.28
Germany 0.24
UAE 0.18
-- 11
12. Indage is importing in bulk , bottling & marketing wines from the following producers/countries
◦ Group Tallian- France
◦ Peter Mertes- Germany
◦ Cranswick Wines- Australia
◦ Zulu- South Africa
◦ Morande- Chile
Sula is importing Chilean red wine and bottling it as „Sartori Merlot‟ with a label designed by Jaideep
Mehrotra (Rs. 420/btl)
Brindco, has a portfolio of nearly 1,000 wine labels from across the world
◦ Among the most notable are Benzinger, Caymus, Sequoia Grove and Kendall Jackson from
California; Bollinger, Albert Bichot, Delas and Louis Jadot from France; Leeuwin, Cinkara and Wolf
Blass from Australia; Allegrini, Gaja, Frescobaldi and Ornellaia from Italy; and Baron Phillippe de
Rothschild (Chile), Rupert & Rothschild (South Africa), Codorniu (Spain), Montana (New Zealand)
Sonarys (Mumbai), imports Grand Crus from Bordeaux, Georges Deboeuf and Faiveley (France); Antinori
, Gaja, Pighin and Tenuta San Guido of Italy (including the famous Sassicaia); Montes from Chile; and
Robert Mondavi's wines from California
Other big independent importers include Global Tax Free Traders Inc and Mohan Brothers (both in
Delhi), RR International (Delhi and Mumbai) and Fairmacs (Chennai)
-- 12Rajni Ranjan
13. Basic Custom duties has been increased to 150% from earlier 100% (under WTO
ceiling of 150%)
Additional 4% Extra Additional Duty has been removed
Since aggregate duty levels exceed the bound level of duty of 150% set forth in
the WTO tariff, ACD and EAD on wine has been waived off from 2007
◦ Individual states may impose a special levy, equivalent to the cumulative
burden of excise and other taxes they impose on domestically manufactured
liquor
◦ By scrapping the additional duty of customs, India would now be in
compliance with its WTO obligation
An additional, Education Cess of 2%+ 1% is also applicable
No excise duty on wine
Sales Tax, as applicable state wise
-- 13Rajni Ranjan
15. -- 15
Strengths Weakness
Nascent stage, few existing
players
High growth rate (25-30% pa)
Increase in urban population
Good climate for growing
wines
Poor quality of wines
Poor awareness amongst
people
High customs and levies
Different taxation amongst
various states
Opportunities Threats
Large domestic market with
increasing disposable income
Lifestyle changes
Growing tourism
New players entering at fast
pace
Entry of foreign players with
tie ups with Indian players
Rajni Ranjan
16. CHATEAU INDAGE (CI)
◦ Established in 1984, with the technical collaboration of Champagne's Piper Heidsieck
◦ Based in Narayangaon, Western Maharashtra
◦ Pioneer of French style wines in India
◦ Company owns vineyards spread over 600 acres, located 230 km from Mumbai
◦ Capacity of producing over 3 million bottles annually
◦ Manufactures 18 types of wine and the main varieties used by the winery are
Chardonnay, Cabernet Sauvignon, Ugni Blanc, Pinot Noir, Gamay, Riesling, Muscat of
Alexandria, Semillon, Sauvignon Blanc, Chenin
Blanc, Zinfandel, Viognier, Shiraz, Malbec and Grenache
◦ Also sells a range of still wines on the domestic market under the names
Riviera, Figueira, Ivy and Chantilli
◦ Indage holds 75 % share of the premium still wine category and the virtual monopoly
in Sparkling wines
◦ Export to
U.K, Sweden, Switzerland, Germany, Canada, Bhutan, Nepal, Srilanka, Mauritius, New
Zealand, Japan and U.S.A
-- 16Rajni Ranjan
17. GROVER'S VINEYARDS
◦ Established in 1988
◦ Jointly owned by Kanwal Grover and Veuve Cliquot
◦ Located in in Dodballapur (40 km north of Bangalore), southern Karnataka
◦ Has 200 hectares of vineyards under wine grapes of 35 varieties
◦ Only company to exclusively use French wine grapes
◦ Grover‟s, with a production of 6 lakh bottles of wine a year estimates a projected
growth of 20 – 25% every year
◦ Exports 25% of its production, worth $ 4,35,000 every year
◦ Exports are mainly to France, US and UK
◦ Received the Agriculture and Processed Food Products Export Award (APEDA) for
excellent performance
-- 17Rajni Ranjan
18. SULA VINEYARDS
◦ Most recent entrant into the Indian wine market
◦ Established in 1998
◦ Nashik based, 200 km north-east of Mumbai
◦ Annual capacity of 1.5 million litres
◦ Famous brands are Sula Brut, Sula Seco and Sauvignon Blanc
◦ India‟s No. 1 premium wine company, with sales of over 2 million bottles in 2007-08.
◦ Sula wines have been exported to US, UK, France, Italy, Canada and Ireland
-- 18Rajni Ranjan
19. The data produced here are not the view of the author but has been collated through a systematic
secondary research process. Any harm due to the data to a person or to any research due the data in the
report will not be the responsibility of the author. The user will use it at it‟s sole discretion.
Rajni Ranjan
