India Inc is bitten by the wine bug. Hindustan Construction Company (HCC), one of the country’s oldest construction firms, is entering the wine business, long seen as a passion for the sundry exotic among entrepreneurs.
Mumbai-based Pancholia family, which made good money from the booming stock markets, is also investing part of their profits into wine business.
Wine is the new investment channel for investment bankers and IT entrepreneurs whose incomes are skyrocketing in an economy which is growing at 8 to 9 per cent. “India’s wine market is growing by 147 per cent annually and it is bound to grow more in the next 10 years. That is why we are planning to produce high quality wine,” said HCC chairman Ajit Gulabchand.
HCC has already acquired 400 acres of grape farming land near Nashik which is fast turning into India’s wine valley. HCC has also formed a special purpose vehicle — Charosa Wineries Ltd — to enter the business.
Unlike traditional wine makers who spent many years to develop the entire production chain, new age entrepreneurs are setting up fast track projects for quick returns.
“We have entered the business last year and our wines are now in the retail market. We will show to the world that our wines are much superior than those produced in traditional markets,” said Viral Pancholia, director, Mercury Winery, which recently launched three wine brands Aryaa, Ex and Mex.
“We have entered into contract farming with growers for assured supplies of grapes,” said Pancholia. Liquor companies like the UB group and Diageo have also recently entered the segment with Bouvet Ladubay and Nilaya range of wines.
French wine makers, who dominate the world wine market, have stepped up promotion efforts in India to ward off competition from local players. The last three years has seen a marked increase in consumption and the market size including imports is now estimated at more than 750,000 cases.