Despite painful taxes, Grover Vineyards is bullish about the India market

In 2012, Bangalore-based Grover Vineyards, one of the oldest wine-makers in India, merged with Vallee de Vin, based in Nashik, to create Grover Zampa Vineyards. The new entity is now the second-largest India wine-maker after Sula. FirstBiz spoke with Grover Zampa’s chief executive, Sumedh Mandla, about what Indians like to drink, how many cases they plan to sell this year and how there is still much work to be done to open up the industry.

It has been four years since the collapse of then market leader Indage Vinters. How has the wine landscape evolved since then and what were the lessons from that event?

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Indian wine industry is still in a nascent stage. Post the Indage debacle, the market has opened to many existing and new wine companies. There has been very good progress with Grover Zampa vineyards and Sula brands. This year overall market is showing growth of 18 percent over last year. The key learning: Quality, controlled distribution, wine education and growth in export markets.

Most wine makers have developed some form of wine tourism in order to help educate their customers about wine and wine-making. How much has this helped and how much remains to be done in this area? How evolved would you say the market is today?

Wine tourism is picking up as a phenomenon. Wine players including Grover Zampa Vineyards, Vallone, Sula, York, Fratelli to name a few are promoting this concept.

But as most of wineries are located in rural areas, there is a greater need for infrastructure and promotion of this concept by government.

[caption id=“attachment_60963” align=“alignleft” width=“380”]  The Indian market is becoming sophisticated enough for multiple segments. Reuters[/caption]

Are you finding that wines have to be tailored for the Indian palette or are Indian palettes adapting to more international tastes? If it is the former, what kinds of wine do Indian consumers prefer?

There no such style as generic style. This is the beauty of wine. Taste and style varies with grapes, winemaker, region etc. There is a small percentile of Indian consumers who are well travelled and understand the finer nuances of wine.

Still new entrants to wine, which is a big segment in India, prefer fruiter, low tannin, aromatic, dry style of wines.

How important is it for Indian wine makers to develop exports and what kind of reception are Indian wines getting in the international market?

Indian wines are getting better international recognition and acceptance. At Grover Zampa, we export to 15 countries and we have won eight international awards. This includes five awards in Decanter Asia Wine Awards and Cathay Pacific International Wine & Spirit challenge.

In an interview with the Indian Express last year, Ravi Jain said Grover Zampa was targetting market leader Sula following the merger and that it was important to have wines priced at all levels, in particular the Rs 200 to Rs 1,100 range. What makes this range important in the Indian market?

Market segmentation based on spending preferences and spending power. High taxation also determine what wine will fit in which price category. Also young and new wine lovers would prefer economical options and rich wine lovers prefer super premium segment only. In fact this year we launched a wine called Chene Grand Reserve at Rs 1700 and is has been very well accepted.

How many cases of wine are you hoping to sell this year?

We will do over 150, 000 cases this year.

What are the major challenges Indian wine producers still face today?

Many, including high taxation. Each state has its own excise policy thus an expensive and cumbersome registration process. Lot of wine expertise and dry goods still need to be imported. Thus it makes it difficult for Indian wines to compete at international platform.

The interview has been lightly edited for grammar and spelling. Reliance Capital is one of the investors in Grover Zampa. The Reliance Group has funded the promoter of Network18, which publishes FirstBiz.