Wine Industry India

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Executive Summary

Imagine starting a winery for just $44,000 in a country where the wine industry is growing at a rate of 25% to 30%.

Yes, the Wine Industry of India is at the introduction stage of its life cycle and a small winery can be started in India with an investment of about $44,000. Required know-hows and machinery are available locally.

For the year 2008-2009, the wine consumption in India was only about 13.3 million litres or 1.5 million 9-litre cases at a value of $82 million. At a per capita level, the consumption was about 9 millilitres annually. In the same year, the world wine consumption was 2.6 billion cases. The size of the Indian wine market is small when compared to global consumption and annual per capita consumption of 70 litres in France and Italy, 25 litres in the US, 20 litres in Australia and 40 millilitres in China.

The prospects of growth for wine in India are quite high. About 600 million Indian’s are currently below the legal drinking age and 100 million will come of that age over the next 3 to 4 years. So, the consumption of alcoholic beverages such as wine is expected to increase. In spite of India’s high import tariffs on wine, this country was one of the world’s fastest growing wine markets. Until the year 2008-2009, growth was about 25% to 30% every year.  However, sales fell in the year 2009-2010 for the first time since 2001. Wine exporters blame the slump on the 26/11 Mumbai terror attacks two years ago that led to a dip in tourism in India. Despite the recent setback, consumption of wine in India is projected to increase to 2 million cases by 2011 and 4 million cases by 2015.

It is critical to note that, the level of tax burden for both local winemakers and importers of wine is high. Control over selling, distribution, and pricing of wine belongs to state governments. Each of India’s 28 states and 7 union territories has its own rules and regulations for sale of alcohol. In some states an imported wine may cost almost 4 to 5 times of its price, with over 50% of its revenue shared between various levels of government. A wine bottle that leaves France at three euros (under $4) is sold in India at approximately 15 euros (about $20).

However, states like Maharashtra, Karnataka and Himachal Pradesh have taken steps to encourage wine industry and given preferential treatments by liberalizing their excise regime and reducing excise duties.  Eighty precent consumption of wine in India is confined to major cities such as Mumbai (39%), Delhi (23%), Bangalore (9%) and Goa (9%).

The supply chain of the wine industry in India is fairly linear. Winemakers are the key to the supply chain and they record good profits. The key to success in the wine business is branding so, a substantial chunk of dollars are spent in selling and distribution. It is also critical to note that, promotion of alcoholic beverages is prohibited in India. So, winemakers use strategies such as surrogate marketing and creating economies of scale.

Success in the wine business in India is conceivable if you do the hard yards of government regulations and have the right marketing mix.


Table of Contents

Industry Definition

Wine Making Process

Key Statistics

Supply Chain

Segmentation

Market Characteristics

Industry Conditions

Key Competitors

Key Factors

Appendices

References


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News - Wine India


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  • Celebrating India's Finest Wines

    Curated by Rojita Tiwari and organised by Pratap Arora as a curtain-raiser for the Mumbai Wine Festival (which is holding four events in Mumbai between December 2014 and March 2015), the tasting was called "Celebrating India's Finest Wines".

    All wines were tasted blind, with the judges only aware of the type of wine and the grape varietals used; scoring was on a 20-point scale, along the lines of what is used by international experts like Jancis Robinson or the University of California, Davis.

    The tasting was conducted at the Yacht Club, Gateway of India by a jury of eight including Alok Chandra (Gryphon Brands Inc), Craig Wedge (FineWinesnMore & SITP member), Rojita Tiwari (Journalist), Sanjay Menon (Sonarys Co-op), Shatbhi Basu (Beverage expert), Sonal Holland (ITC Welcomgroup & SITP member), Subhash Arora (Indian Wine Academy), and Vishal Kadakia (Wine Park).

    The top wines (cut-off taken at 14.5 points) out of the 81 wines tasted were:

    Sparkling Chandon Brut Rose' - Domaine Chandon India 14.6

    White Seagram's Nine Hills Chenin Blanc 15.6
    KRSMA Estates Chardonnay 15.4
    SDU Deva Chardonnay Reserva 15.3
    Seagram's Nine Hills Viognier 14.9
    Grover Zampa Sauvignon Blanc 14.6
    Sula Vineyards - Riesling 14.53
    Sula Viognier 14.5

    Sweet White Vallonné Vineyards Vin de Passerillage 14.9
    Sula Late harvest Chenin Blanc 14.7

    Rosé Sula Roé Zinfandel 14.75
    Vallonne Rosé Cabernet Sauvignon 14.7

    Red SDU Syrah Reserve 16.2
    Vallonné Cabernet Sauvignon Classique 15.5
    Grover La Reserve 15.3
    York Winery Cabernet Sauvignon 15.15
    Fratelli Sangiovese 15.1
    Reveilo Sangiovese 14.7
    SDU Cabernet Sauvignon 14.6


    Apart from the presence of the industry leader Sula and old favourite Grover (now Grover-Zampa), the surprising winners of the exercise were SDU Winery (Karnataka) which launched in early 2013; their wines are available only in Bangalore as yet. And Vallonne Vineyards from Igatpuri, near Nashik, which is clearly doing many things right, as also the resurgent quality of the white wines from Seagram's Nine Hills.

    There is no doubt that the quality of Indian wines is improving every year. One looks forward to such tastings (with vintages included) becoming an annual exercise and proving to be an invaluable guide to consumers and the trade alike.

    In addition to this, in Mumbai the Indian Wine Consumer's Choice Awards (IWCCA) has been gaining ground for some years now, while the Bangalore Wine Club organised a Wine Village at the ITC Gardenia Bangalore in August and conducted an informal poll of the best Indian wines. The Sommelier India Tasting Panel (SITP) meets regularly to assess and recommend Indian, as well international, wines to consumers.

    Two issues ago SI wrote about Relishing India's Reds and earlier this month SITP tasted the new vintages of Indian wines, including Fratelli's flagship Sette 2011 and two whites from their new brand, Vitae, along with Grover Zampa's latest award winners, to name but a few.

    Read more about SITP recommendations and the current state of India's wine industry in the next edition of Sommelier India WINE - December 2014/January 2015 issue.

  • Wine Society of India event hosted by Steven Spurrier

    Steven Spurrier rose to international prominence in 1976 for organizing The Judgment of Paris, a high-profile blind tasting that pitted famous French wines against a relatively unknown Californian wines; the Calfornian unknowns came out on top!

    This event gave a major boost to a struggling Californian wine industry that did not believe that it could compete with the quality French wine. California now produces some of the finest wine in the world.

    Steven was introduced to the potential of India as a wine market in 2004, and in 2006, he became Chairman of The Wine Society of India. In 2009 he was Chairman of the Sommelier India Wine Competition 2009 with Reva K. Singh as co-chair, the first Indian organized competition to assess wines produced in India, as well as international wines available for consumption in the country, in association with The Wine Society of India.

    Steven hosted an event for Wine Society Members at Terttulia on the 5th of November, with eight different wines being shown on the night. Steven is no stranger to hosting events in India.

    "When I hosted the first Wine Society of India Events back in 2007 in Mumbai and Bangalore, we had less than a few dozen members. Today, we have over 10,000 members who enjoy the benefits of a wine lifestyle. Wine is about conviviality and sharing the moment. I look forward to sharing some fantastic wine with our best customers."

    About The Wine Society of India
    The Wine Society of India sources boutique wines from family-owned wineries from around the world, for its members in Maharashtra, Delhi, Karnataka and West Bengal. For enquiries, please call +22 6136 8150.

  • 7th Indian Sommelier Championship gathers speed

    In the final round the top six sommeliers from both Mumbai and Delhi will be quizzed and asked to demonstrate their service skills followed by a theory exam. The drumbeat begins on the last day when the stage is set and the spotlight shines on each individual for a crucial 12 minutes as they are tested on:

    •Opening and serving a bottle of wine
    •Properly decanting an old bottle of wine
    •Swift sparkling wine service
    •Tasting and decoding the wines
    •Food and Wine pairing exercise
    •Wine and Food pairing exercise
    •Beer opening, service, and tasting (introduced since 2012)
    •Spirit tasting and appreciation (introduced since 2013)
    •Open questions from the judges

    And then it's finally over. Whew! And time to celebrate at the Gala Awards Dinner on Tuesday, 11 November 2014.
    THE LEELA
    Ambience Gurgaon
    Hotel & Residences

  • Chilean Food & Wine Fest: long awaited & much enjoyed

    The evening started with a short introduction by the ambassador who later spoke to Sommelier India. When we quizzed him about holding such an event, Ambassador Barbe said, "This is a fantastic experience. India is a small market but we have over 50 different types of wines to offer. We are waiting to export more and to hopefully cover the Indian wine market with Chilean varietals. We would really like the people of India to try our wines and popularise them."

    Among the show stealers of the evening at the Crystal Room were Chilean wines distributed by Indian importers like Brindco Sales Limited (Montes Reserva), Agnetta International (Valdivieso), Hema Connoisseur Collections (Emiliana), Natures Bounty (Balduzzi), Prestige Wines & Spirits (Miguel Torres), Sula Selections (Cono Sur) and High Spirits (Anakena).

    While serious wine connoisseurs, diplomats, members of wine clubs and other prominent people enjoyed the wines, the food was an equal hit. With exotic Chilean products like salmon, trout, pork, walnuts, berries and red globe grapes, Chefs Imtiaz and Goswami of the Lalit prepared a fine spread of food that paired well with the wines on offer. From the jerk marinated grilled chicken, prawn tempura, the popular Champagne pink pan-seared salmon to the nicely done New Zealand lamb chops and the Indian vegetarian section, the food was excellent.

    One caught conversations about how expensive it was to import Chilean wines, how good the lamb chops were and how India is fast becoming a great place to try different wines of the world.

    Wine connoisseur, Bunny Suraiya summed up the event rather nicely, "The annual Chilean Festival of Food and Wine is a red-letter day on Delhi's wine-lovers' calendar -- long awaited and much enjoyed!'

  • Pune's new wine club - The GrapeWine Oenophiles

    The club has recently been started by Sujata Patil, who has lived in France, experienced its wine culture and been a part of the Indian wine industry for the past few years. Considering the variety of Indian wines available, both in terms of grapes and styles, and good value-for-money imported wines, she thought of starting a wine club where members could sample different wines and get to know them.

    "Although Pune has hosted several wine festivals and has stores retailing an impressive stock of wines, it was time to start a great wine club," says Sujata. After brainstorming with acclaimed Chef Shailendra Kekade of Stone Water Grill, Pune's stylish lounge that serves fine wines with gourmet European cuisine, she decided to host theme-based wine and food evenings at the lounge.

    At the two meetings held so far members have been welcomed with a sparkling wine and then moved on to enjoy a sit-down wine dinner where five wines have been paired with dishes prepared by Chef Kekade.

    "The wines were selected keeping in mind the many wine novices in the club," Sujata said. "The idea was to first familiarise members with the various varietals available in the market and then get them to appreciate the wine for its expression of the grape variety used. Each new session will have a different theme once all the available varietals have been tasted."

    As the food and wine flowed, the space was soon abuzz with conversation and Sujata had to not-so-gently tap a wine glass to draw everyone's attention to the next wine being served! As Sujata explained the nuances of each wine and answered queries, she encouraged members to ask more questions and interact with each other. Chef Kekade informally chatted with guests and also the staff who served the wines and food with great care. As the evening progressed into the night, the food and wine was consumed and new friends were made.

    And then the parting question came up - the answer to which everyone wanted to know - when would the next meeting be?

    For details on The GrapeWine Oenophiles write to sujatapatil@gmail.com or call her at +91 99 700 02196

  • Grover Zampa Vineyards stand tall at DAWA 2014

    Apart from winning the international trophy, Grover Zampa also bagged three silver medals for its La Reserve' White, Chene Grand Reserve and Vijay Amritraj Reserve Collection White.The winery was also awarded three bronze medals for its Grover Art Collection Cabernet Shiraz, Grover Art Collection Viognier and Zampa Soiree' Brut.

    This is indeed a proud achievement for India's wine industry, as the Decanter Asia Wine Awards (DAWA) is Asia's largest wine competition that draws a huge participation from wineries all across the globe; this year more than 2,500 wines took part.

    Since the aim of DAWA is to recognise and commend quality wines, Steven Spurrier, DAWA co-chair and Sommelier India columnist, said, "Our standards are high, and so are our expectations. We only award medals to wines in which consumers can have the utmost confidence."

    A justifiably proud, Sumedh Singh Mandla, CEO Grover Zampa Vineyards said: "We are extremely honoured to receive this recognition at the Decanter Asia Wine Awards. The recognition reiterates our position of being one of finest wine makers in India.

    "We are committed to producing top quality wines, enjoyed by wine aficionados all over the world. I am sure this success will help us and other Indian wines, stand tall at international platforms."

  • Sangrias in a bottle!

    Trinity Vintners started its operations in 2011 with the launch of Turning Point and JLT range of wines. The company has always wanted to introduce wine that is fun to drink, has less snob value attached to it and can be enjoyed for what it really is! "With Turning Point wines, it's about wine and mood rather than wine and food!" says Ashwin.

    Deo's passion is backed by logic, which stems from the fact that urban and uber cool, young and even the not-so-young Indians aren't indulging in long, sit-down dinners while sipping fine and rare wine. They would rather indulge in pre-dinner drinking that usually ends in a quick buffet-styled dinner.

    This is largely the norm now even in cities that are blessed with more space than the crowded metros. Trying to educate Indians about pairing spicy Indian food with wine may be a challenge. However, Deo believes that wine should be able to fit into everybody's lifestyle and not just remain a drink for people living the high life.

    Turning Point ready-to-drink Sangrias are available in two variants - Metropolitan (cranberry and orange) and Nashik Mule (orange and ginger ale). Packaged in brightly coloured 330 ml packs, these Sangrias can be enjoyed straight from the bottle or in a glass with ice and some chopped fruit.

    Initially launched in Maharashtra across leading retail stores, restaurants, lounge bars and night clubs, Turning Point sangrias are priced at 135 and will soon be made available in other states.

    Watch this space for more...

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