Indian Wine Market

[sthomas12]

I don't think anyone on this forum knows me personally. I have been a customer of George for a little while experimenting with a few wine kits. I am writing this to see if there are any entrepreneurs out there who has a passion for wine and has the business skills as well as energy and resources to tap an emerging market.


T</DROP_5LINES>he Indian wine industry is on a high. Quite literally! For, as the market is growing at a consistent 25 per cent every year, a range of local entrepreneurs, foreign liquor companies and private equity firms have set their sights on the segment which is bubbling with action.


It is still a relatively small market with India's wine marketestimated at five million bottleslast year. However it is projected to grow at 25-30% for the next 5 to 10 years making it a substantial part of the alcoholic beverage market in India. This is happeing due to the newly rich, growing educated middle class who is developing a pallete for wine. There are 200 million and growing middle class folks in India who could drink good wine!


The industry is stillregulated and scarcity of wine grapes makes it dificult for new players to enter tha market. But i could see the situation changing quickly.


Having grown up in India and being passionate about wine, I have been thinking about entering that market. However, i don't have enough experience inwine making.


Are there people out there who would be interested in having a discussion around starting a wine business in India? If so please let me know.


Regards
Sunil Thomas


[email protected]

 

[Dean]

Sunil, you think a lot like me! Always looking for business opportunity! I really like that.

I would think to start, grapes would have to either be imported or suitable varietals for the climate would have to be found. I mean, c'mon, this is one of the worlds older civilization regions and we all know that wine did start in and around this region, so grapes must have had to be present at one time.

So, do you have any data on what grape varietals can comfortably exist in certain regions in India? What about other areas around India that might be able to produce as well and export to? Areas like Egypt, Ethiopia, or any other northern African country that has a deep Indian influence?

As you can gather, I'd be very interested in discussing this. It smells like a great topic to mull over.

Dean

 

[sthomas12]

Dean, nice to meet you. <?amespace prefix = o ns = "urnchemas-microsoft-comfficeffice" />

<?amespace prefix = st1 ns = "urnchemas-microsoft-comfficearttags" /><st1ountry-region wt="on"><st1lace wt="on">India</st1lace></st1ountry-region> has 123,000 acres of vineyards. However, 95% of these vineyards grow table grapes. Most of the wines produced in <st1ountry-region wt="on"><st1lace wt="on">India</st1lace></st1ountry-region> are table wines with the exception of a couple of new comers who planted wine grapes a few years back.

Growing regions are concentrated in two areas.

1. <st1:City wt="on">Nasik</st1:City>, around 200 km from <st1:City wt="on"><st1lace wt="on">Bombay</st1lace></st1:City>
2. Nandi hills, around 200 km from <st1lace wt="on"><st1:City wt="on">Bangalore</st1:City></st1lace>.

Both these area are high altitude (around 2000 ft) and has moderate rain.


In Nandi hills area, a company named Grover vineyardsexclusively planted French wine grapes, selected from the original thirty five varieties of the Vitis vinifera species

In <st1:City wt="on">Nasik</st1:City> area, a <st1lace wt="on"><st1ountry-region wt="on">US</st1ountry-region></st1lace> returnee froma Stanford graduateconverted his family farm with wine grapes. He planted varietalsincluding Chenin Blanc, Sauvignon Blanc, Cabernet Sauvignon, <st1lace wt="on"><st1:City wt="on">Shiraz</st1:City></st1lace>, and Zinfandel. Experimental research is currently focused on <st1:City wt="on"><st1lace wt="on">Muscat</st1lace></st1:City>, Riesling, Roussanne, Viognier, Grenache, and Merlot.His company is called Sulawines.

Both these companies are doing extremely well introducing the wine as it should be to the Indian market. I have tried both of their wines and arepretty good in fact.

I am sure there are other areas within the country that would be suitable for grapes as well. But yet to be discovered.

I think the best way to enter the market is by importing wine grapes and grape juice concentrate. Indians really don't care much for appellations, but new middle class is brand conscious.

You could use the imported grapes route to establish a presence and build a brand. At the same time research area where grape could be grown.

One issue in <st1ountry-region wt="on"><st1lace wt="on">India</st1lace></st1ountry-region> is that, there are 34 states each of which has their own regulations and laws. So it would be like doing business with 34 countries. Therefore, a new entrant would have to build a brand within one market and later look for expansion possibilities. However, I am not sure how grape can be imported given the long journey ships take to get to <st1ountry-region wt="on">India</st1ountry-region> from say <st1lace wt="on">South America</st1lace>.

I thought about importing bulk wine and bottling it under a brand to market in <st1ountry-region wt="on"><st1lace wt="on">India</st1lace></st1ountry-region>. However, the grape growers lobby outsmarted by passing regulations to impose import tariffs on bulk wine in the amount of $2.2/litre.


Anyway, I am doing more research on this. But would like to find like minded and knowledgeable people to join in a venture.

From a regulations perspective, Foreigners are allowed to start winery in <st1ountry-region wt="on"><st1lace wt="on">India</st1lace></st1ountry-region>.

I strongly believe the market can be huge a few years from now and there is money to be made. At least it will be a fun thing to do!

Regards
Sunil