Wine, the new elixir for India's spirit lovers?

Sweetened by favourable trends in consumption and production alike, the wine industry in India is looking to top up some more glasses, as demand for the aromatic beverage is on the rise.

The country’s wine industry is gearing up to offer quite a lot to connoisseurs, be it in terms of taste or price. A study by the Associated Chambers of Commerce and Industry of India (Assocham) has said: “Clocking a CAGR of about 20%, wine consumption in India is likely to touch about 37 million litres by 2018, from the level of 18 million litres as of 2014.”

“The wine market in India is dynamic and has been gradually evolving over the years. It is evolving at a steady pace, and has witnessed an approximate 15% growth in consumption of wine in India over the past years,” said Sula Vineyards Vice President (Marketing) Cecilia Oldne, adding, “Sula Vineyards itself has shown positive growth rates. The influx of new wineries is a good indication of the growth that the industry is currently experiencing.”

Nashik, Maharashtra-based Sula Vineyards, the flagbearer for organised wine production in India, is now the country’s largest wine producer, with over 60% market share. Having commenced operations in 2000 with a sale of 50,000 bottles, the company claims to be well on track to sell a million cases of wine this year.

 Closer home, Bengaluru-based Grover Zampa Wines has been witnessing a year-on-year growth of 50% over the past decade, informed Sumedh Mandle, Chief Executive Officer of Grover Zampa Wines.

World, many drinks away

It must however be noted that wine consumption in India is far from international standards. Where the per capita world average stands at four litres per annum, India has managed to hit just 9-10 ml per annum.

The biggest challenge for the industry remains customer education. “It is commonly seen that the introductory purchase of wine takes place through an organised format. But once consumers are well-versed about wine, they don’t mind buying it from any format. Proper consumer knowledge serves as the primary sales trigger, and organised retailers are capable of capitalising on the same,” a report by Technopak says.

Interestingly though, domestic vintners seem to be in consensus that wine tourism is a strong channel to get the word out in the market. Wine tourism has become a major attraction for tourists, activity-enthusiasts, and the curious in India. “India has traditionally veered towards hard spirits. As a result, the Indian wine market is emerging and looking for guidance and education on how to truly enjoy wines,” said Oldne.

Mandle said, “Wine can be intimidating because of its diversity and sophistication, and only 1-2% of the wine drinkers in India are educated about it. The only way to educate people is through tastings.”

About Sula’s initiative on this front, Oldne said, “We lay special emphasis on wine education, and do this by conducting wine tastings at Sula Vineyards in Nashik for the consumers, as well as part of corporate programmes, to reach out to a larger consumer base and spread more awareness. We are also the approved programme provider for level 1 and 2 WSET (Wine and Spirit Education Trust) courses in India. Additionally, through wine tourism, we strive to provide our patrons with experiences that they will cherish for life. Back at the Sula Vineyards, we have winery tours, vineyard tours and elaborate wine tasting and pairing sessions for visitors.”

Owing to such initiatives, it is found that up to 85% of wine consumption in the country is in the domestically produced market. Mandle adds, “Since domestic producers have better access to their markets, it becomes that much easier to educate the customer and adapt to their tastes and price preferences.”

It has been found that in India, wine is most popular among the age group of 25-34 years, as well as among high income consumers, and particularly among professional women. Industry aficionados also assert that there is a tendency for the Indian palate to prefer sweeter wines to begin with, and develop therefrom.

“In India, wine consumption is mostly a part of fine dining experiences. The trend is only growing, with statistics showing that the number of bottles sold at restaurants is much higher than those at bars. Shiraz is the most popular variant here, as it serves as a very good accompaniment with Indian food,” said Mandle.

“While the tastes and preferences of the Indian population towards still wines is at a nascent stage, there is a visible gradual increase because of an increasing exposure of Indians to wines through international travels as well as greater dining and beverage establishments opening in India. Indians are open to exploring wine as an alternative drink of choice, especially among women and the younger demographics. There is a larger market, however, for sparkling wine varietals today, and Rosé wines are well-picking up in the Indian market too,” said Oldne.

On how much India spends on wine, the industry agrees on an average of Rs 600-800 per bottle. As prices in the market scale from Rs 600 to even up to Rs 2,000, takers are largely found in the mid-segment. But, although small, takers in the Rs 1,000-1,850 segment have grown more, at a rate of about 20% for Grover, said Mandle. Motivated, Grover Zampa Wines plans its entry in the magnum space with the launch of its festival edition red wine. A magnum is a 1.5-litre package. Pricing it at Rs 5,000, the company plans a Deepavali launch and will sell it by invitation only.

Despite their domestic challenges, Indian wines have made it past the boundaries. Sula is present globally in over 30 countries and Grover Zampa, which is present in 23 international markets, targets a cumulative of 30 by this year-end.

At present, the inspired wine industry in India features serious players in Chateau Indage, Grover Zampa Vineyards, Sula Vineyards, Sankalp Wines, and Heritage Grape Winery. So, while the Indian wine industry may have won the battle, the bitter-sweet war still goes on.