Grover targets millennials with carbonated wine category

Ravi Viswanathan, Director at Grover, and a veteran of the Indian wine industry talks about how the acquisition will pave the way for expansion into wine spritzers and carbonated wines for millennials. Excerpts from an interview:

The size of the Indian wine market including imports is about 30 mn bottles. China, on the other hand consumes about 3 bn bottles a year. The domestic market has been growing over 15 per cent a year and Grover has grown faster than the market.

We have a significant presence in the South market – ours is the oldest winery in India and we launched our first vintage 26 years ago.

Since then, the number of competitors has increased, and some grew faster than us. Setting aside our recent acquisitions, Grover is No 2. Post acquisitions, the next financial year onwards, we will maintain our position, but the gap will not be substantial.

For the current fiscal, Grover witnessed a 50 per cent surge in growth and slightly lesser growth in volume. In April 2020, we expect to grow more than 120 per cent.

Grover was a French styled winery making wines influenced by Bordeaux. The capacity of existing wineries of Grover was fully utilised – both in Bengaluru and Nasik. So, we had a choice between buying existing wineries, or building our own. We are building a new modern, eco-friendly winery in Bengaluru to be completed in 18 months. As the Maharashtra unit was smaller in size, we decided to acquire two companies with substantial free capacity, which we will run in full capacity in the next 1 to 2 years. All our investments over the last six months, which have already been funded, are in the order of Rs 70-80 cr – most of them for two wineries, additional equipment capex and some for the existing wineries.

From April 1, we will introduce carbonated, ready to drink, spritzer-like beverages with a base of wine, with various flavours like orange, passion fruit. It will be a low alcohol version in two formats, size wise, for younger patrons. We expect this product to do well among casual drinkers. Growth wise, this year, between all our wineries, we will produce 6 mn bottles of wine. In three years, we envision the 12 mn mark. We have secured the land to get the grapes. Beyond that, we will add more wineries – to increase output by probably 20 to 25 per cent annually. The next three years will be high growth. Last year, we produced 1.8 mn bottles, this year we produced 2.5 mn bottles, and aim to do 12 mn bottles in 3 years’ time. Exports component is just about 10 to 15 pc, and although we export more than all the other Indian wine companies put together, the domestic market remains our focus. In other states, we offer a Sommelier at Home service, where trained professionals help you with tasting and pairing sessions. We piloted this in Mumbai and Bengaluru in December last year, which received an encouraging response.

It’s surprising to see a state in India, like Tamil Nadu not authorising sale of domestic products (wine), whereas foreign products are freely available. It’s ludicrous, especially since our products are agricultural which generate wealth in rural communities.