The Indian alcoholic beverage segment seems to have finally come of age. Growing at around 12-15% currently,[i] the industry is gradually picking up momentum. Notably, while the white spirit accounts for the largest market share, the Indian wine is projected to have maximum potential for growth in the near term. Significantly, it is estimated to be growing at around 25% at present.[ii]
Wine market matures
Till about a couple of years ago, the Indian wine market was an untapped segment. This justified the low-base volume of Indian wine as compared to other forms of spirit. However, with changing times the Indian wine industry has also evolved, indicating steady growth in terms of revenue and volume.
 Factors favouring the Indian wine industry
According to wine makers in the country, several factors have worked in favour of the wine industry in India. Aneesh Bhargav, Senior Marketing Manager at Neeraj Wines, a Pune-based wine manufacturer and retailer, says, “The industry got a major boost after regions such as Karnataka, Maharashtra and Andhra Pradesh were classified under the Agri Export Zone (AEZ) for grapes.”
Mr Bhargav adds that the move not only doubled wine production but also rendered wineries in these states more competitive.
Interestingly, the success of the wine industry in the western states is also motivating some northern states such as Himachal Pradesh and Uttarakhand to explore wine production.
Considering that the wine industry is relatively less capital intensive in comparison to other alcoholic beverages, more and more small units are likely to venture into this industry. “By implementing the appropriate technology, small players can also reap benefits of the wine segment. Given that most wineries in Nashik are small-scale units, there is no reason why small players in other parts of the country cannot emulate their success story,” feels Shekhar Doshi, General Manager-Accounts and Planning at Sigma Wineries Pvt Ltd, a Nashik-based winery.
Issues to be addressed
With changing lifestyle and a high disposable income of urban consumers, market players expect the segment to grow robustly. However, the government should address the concerns of wine makers in the country by rationalising the existing tax structure and formulating an appropriate policy to support the distribution system.
Shubhomita Bose [i] Confederation of Indian Alcoholic Beverage Companies (CIABC)
[ii] India Brand Equity Foundation (IBEF) |
