How to turn Indians into wine-drinkers: the case of Sula Vineyards
It sounds like a fable: one man's quest, in a small corner of India, to turn beer into wine. Actually, it is the plan by one of the country's rising class of entrepreneurs - Rajeev Samant, founder and CEO of Sula Vineyards - to get Indians to swap their Kingfishers for Cabernets.
Beer is India's favourite alcohol. Some 140m cases were sold in 2007 and the country's largest operators, including UB Group, owner of the Kingfisher beer brand, and the local operations of SAB Miller, owner of Hayward's 5000, enjoy distribution and promotional strength.
It manages to be both cheap and aspirational, and in cities such as Delhi, the country's regulations, which include a ban an alcohol advertising coupled with heavy drinks taxes, have been relaxed for beer but not other drinks.
But none of this deters Samant.
"If I can just get people to taste my wine, I know I'll have a customer for life," Samant says, lounging on the verandah of a company-owned apartment in Delhi.
Is he right to be optimistic? Certainly Sula has risen quickly. In eight years, it has grown into India's second biggest wine producer with a 20 per cent market share. It has consistently increased sales by 45-50 per cent a year, and now sells 200,000 cases a year, equivalent to a retail value of $15m.
Then again, Indian wine as whole is booming, with an estimated annual sector growth rate of about 30 per cent. The longer-established Chateau Indage, India's biggest wine brand with 40 per cent market share, has increased sales by about 80 per cent year on year. A third player, Grovers, is also growing at 60 per cent, according to Nixon D'mello, its national sales director.
As new brands launch, and distribution and customer knowledge improve, the sector is expected to enjoy further expansion. In a country of 1.12bn people and rising middle class incomes, the potential for growth is huge.
Samant says: "At the moment, there is room for everybody in the Indian wine business. In fact, we keep running out of wine. We cannot meet demand."
Simply increasing capacity could help maintain the momentum of recent years. This year, for instance, Sula has added two million litres to its production, planted an extra 1,000 acres of vines and is crushing double the number of grapes.
Vintage hopes: Rajeev Samant, founder and CEO of Sula Vineyards, hopes to turn
his fellow countrymen into a nation of wine drinkers
Working round advertising restrictions