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Not profit, passion drives India’s small wineries

Global recession and terror attacks caused some to close down, but supply of wine still outweighs demand in India.

india Updated: Jul 28, 2010 13:44 IST
Naomi Canton

When the state government eased regulations on the wine industry, dozens of businessmen, lured by the glamour of starting a winery, started producing wine. More than 70 wineries mushroomed, mainly in Nashik. Global recession and terror attacks caused some to close down, but supply of wine still outweighs demand in India.

Yatin and Kiran Patil started Vintage Wines Pvt Ltd in 2005. Both left their jobs to establish a winery at Yatin’s family’s farmland. They now produce 1.5 lakh litres of wine per year, under the Reveilo name. Their total investment at the outset? Rs 5 crore.

With an annual turnover of Rs 3 crore, they are yet to break even. And when they do, they anticipate a five per cent margin.

Not an easy task “It’s not easy to make money in this business,” Yatin admits. “There are several overheads initially. It takes three years to grow a crop, and another year and a half to bottle it. We even have to fight for space on the shelves, as big players push their own products. We have to start from scratch,” he says.

Red WineMany small wineries like his survive by producing premium estate-bottled wine. "We grow grapes and make the wine from those grapes, and don’t overcrop. Other companies outsource the grape growing, or buy wine and just bottle it," he says.

That is what New York-based entrepreneur Girish Mhatre did in 2009. He started a virtual winery. He owns neither a vineyard nor a winery at Good Earth. He has a winemaker who knows the right time to harvest, and handles bottling and fermentation.

Explains Navin Sankaranarayanan, commercial head for Good Earth, “You don’t have to own a vineyard to make wine. We will break even quicker than if we had bought a vineyard.”

“We don’t over irrigate our vineyards (it dilutes the wine) and our yield is 50 per cent less than other vineyards, as we only take the best fruit, plus we invest in packaging,” Sankaranarayanan adds. Ranjit Dhuru, founder and CEO of software company Aftek, founded Chateau D’Ori in 2000 after he developed a passion for wines on business trips overseas. He too grows his own grapes and ensures only a limited number of bunches are taken from each vine.

“It’s not just about making a good wine, you need to know how to sell it,” he adds. “Passion keeps me going. I think you need to be a bit crazy in the head to do this,” he says.

Three small winemakers in Nashik provide some alternatives to the well-known names:
Reveilo wines
Reveilo Grillo (white)
Rs 605
Made using Sicilian Grillo grape
Launched: April 2010

Nero D’Avola (red)
Rs 645
Made using Sicilian Nero
D’Avola grape
Launched: April 2010

Syrah (red)
Rs 545
Made using Syrah grape
Launched: April 2006

Chardonnay (white)
Rs 705
Made using Chardonnay grape
Launched: April 2006

Cabernet Sauvignon Reserve (Red)
Rs 1,345
Made using Cabernet Sauvignon grape, aged in oak barrels
Launched: Jan 2007

Good Earth Wines
Basso (Cabernet Sauvignon Reserve 2008) (red)
Made with Cabernet Sauvignon grape
Most expensive Indian red on the market
Rs 1,450
Launched: December 2009

Most expensive Indian Sauvignon Blanc
Rs 725
Launched: December 2009

Antaraa (Cabernet Shiraz) (red)
Made with a mix of Cabernet Sauvignon and Shiraz grapes
Rs 825
Launched: July 2010

Chateau d’Ori wines
Viva (white)
Rs 510
Made using Chenin Blanc grape
Launched: January 2008

Sauvignon Blanc (white)
Rs 598
Made using Sauvignon Blanc grape
Launched: January 2008

Merlot (red)
Rs 598
Made using Merlot grape
Launched: January 2008

Cabernet-Merlot (red)
Rs 660
Made using Merlot and Cabernet Sauvignon grape
Launched: January 2008

Cabernet-Syrah (red)
Rs 780
Made using Syrah and Cabernet Sauvignon grape
Launched: January 2008

Syrah Rose (rose)
Rs 598
Made using the Syrah grape
Launched: December 2008