PROJECT ON

“WINES”
 Indian wine industry
The wine industry has witnessed a CAGR of over 25% over the last 3 years in the
premium wine segment mainly fuelled by the strong growth in the domestic wine
consumption.
The industry is not very capital intensive, as it requires around Rs.5 to 6 crores to setup a
Wine plant with a capacity of 500,000 liters. Which does not include plantation cost.
The key raw materials such as grapes, bottles, and corks account for approximately 20%
of the total costs and are higher than the international norms.
The industry has low entry barriers because of its low capital-intensive nature however
the industry is under pressure for profits due to high marketing costs and low volumes.
With demand increasing at a steady pace, the industry is expected to go through a
consolidation phase.
The fortunes of the industry are linked to the trend in the changing drinking habits of
Indians, higher disposable incomes, growth in the foreign tourists, and government
regulations and policies.
The Indian wineries have planned expansion plans to meet the increasing demand.
There is a strong growth in the imported wine market with Indian importers importing
hundreds of brands from countries like Australia, US to Bulgaria. Some of the well-
known wine producers are also present in India like Moet and Hennessey, E&J Gallo and
HWWG.
 Why Wines?
– Increase in per capita income
- Changing life styles
- Frequent travels abroad
– International research on health benefits of wines
– Taste for wine has recently become a sign of sophistication
among Indians.
– Most Indian bottles cost around US$10, making them far
more affordable than foreign wines, which can cost several
times what they would in Europe or the U.S. due to heavy
taxes and import duties.
– The wine importing business is also murky with grey-market
bootleggers and improperly stored bottles, making locally
produced wine an attractive option.
 Present condition

• India ranks 77th in wine consumption,

• Food processing industry status granted to wineries
• There is growing awareness about the wine as a
product in the domestic market.
• India- 65 wineries
Maharashtra 58 wineries
 Various aspects of wine
industries

• Legal aspect
• Global aspect
• Social aspect
• Promotional aspect
Maharashtra wine Grape
policies
• Declaration as a Preferential Area
• Declaration as a Small Scale Industry
• Concessions in Excise Duty
• Concessions in Sales Tax
• Wine Sales License
• Wine Sales License Fee
• Simplification in the system of License
• Establishment of Wine Institute
• One Window System
• Establishment of Grapes Board
• Facilities of Food Processing Industries
 Various taxes and duties
applicable to the • wine industry
• Excise Duty
• Additional Duty
• Markets & Regulations
• Centre for Civil Society
• Distillery/Brewery License
Fee
• Bottling fee
• Litterage fee
• Assessment Fee
• Franchise Fee
• Permit Fee
Raw Material Excise
• Availability Fee
• Brand/Label Fee
• Transportation Fee
• Import Pass Fee
• Export Pass Fee
• Vend Fee
• Sales Tax/Surcharge
• License Fee
• Toll Tax
• Gallon age Fee
Model cost card of wine for
Maharashtra
• Manufacturer selling price 1575
• Excise Duty @ 0% 0
• Distribution Costs at 25% of MRP 788
• License Fees at 5% of MRP (LF) 158
• Sales Tax @25% of ECP or 20% of MRP 630
• Total 3150
• Govt. Revenue – Rs per case 788
• Manufacturer share as % to MRP 50%
• Distribution share as % to MRP 25%
• Govt. revenue as % to MRP 25%
• MRP PER BOTTLE 263
Process of Wine Production
RED WINE WHITE WINE
• Destemming & Crushing
Red Grapes Harvest
• Adding to Fermentation Destemming & Crushing
Containers Pressing
Adding to Fermentation
• Adding Sulfur Dioxide
Containers
and Yeast
Sulfur Dioxide Addition
• Alcoholic Fermentation Clarification
• Maceration Selecting Yeast Type
• Pressing White Wine Alcoholic
• Malolactic Fermentation Fermentation
• Racking Barrel Aging
White Wine Malolactic
• Clarification
Fermentation
• Bottling and Labeling Racking
Clarification & Bottling
Types of grapes for wines
RED GRAPES WHITE GRAPES
Cabernet Franc Chardonnay
Cabernet Sauvignon Chenin Blanc
Carignans Clairette
Gamay Muscadelle
Grenache Pinot Gris
Merlot Sauvignon Blanc
Mourvedre Semillon
Pinot noir Ugni Blanc
Syrah
 Contents of wine
• Water 86 %
• Alcohol 10-12 %
• Glycerol 1 %
• Organic acids 0.4 %
• Carbohydrates (Unfermented sugars) 0.2 %
• Minerals 0.2 %
• Tannins and colour pigments 0.1 %
• Acetic Acid 0.04 %
• Nitrogenous matter 0.02 %
• Higher alcohols (propyl, methyl and butyl) 0.01 %
• Traces of vitamins
• Polyphenols
• Antioxidants
 The People
Growth:
Indian Economy
9% 2006
2005
9.4
2007 2008
9.5
2009 2010

9.7
Population (millions)
9.1
1,095.4 1,110.4 1,125.4 1,140.2 1,155.0 1,169.7

Household consumption (US$ 2028 2210 2419 2651 2910 3176

billion)

Growth: 9% 9.4 9.5 9.7 9.1

□ The rising middle class within India is bringing with it a

higher rate of consumption
□ Wine consumption is also increasing at a rate of 10ml per
year/ per person
 The Market
• Wine expanded phenomenally by around 18% in 2007
• Total Indian Consumption has risen to 1.1 million cases (2008-
2009)
– 10ml annual per capital consumption
• A survey conducted on the members of a wine club in India
showed that nearly 50 per cent of consumers were women and
this segment is growing at 5 per cent every six months

• Target Market
– Middle class ages 25-39
– Current biggest wine consumers
• Trendy upper class
 Types of wine consumption
consumption
50.00%
45.00%
40.00%
35.00%
30.00%
25.00%
20.00%
15.00%
10.00%
5.00%
0.00%
red white sparkiling rose
 Indigenous Wineries
• Chateau Indage
– 18 types of wine
• Chardonnay, Cabernet Sauvignon, Ugni Blanc,
Pinot Noir, Gamay, Riesling, Muscat of Alexandria
Sauvignon Blanc, Chenin Blanc, Zinfandel,
Viognier, Shiraz, Malbec  and Grenache
• Grover Vineyards
– Nine varieties
• Zinfandel ,Chardonnay, Pinot Noir,
Sauvignon Blanc, Chenin Blanc,Viognier, Shiraz,
Viognier and Semillon
• Sula winery
• Sula Brut, Sula Seco and Sauvignon Blanc
Major players
Up
to
of 80
De the %
ma
nd

Major brand players

10%

3 brands
others

90%
Somras wines
An Indian touch

CHARDONNAY

Syrah
 CHARDONNAY
- Crispy
- Well balanced acidity level
- Citrus hint slightly with lemony tinge
- Can be paired very well with Spiced meat & masalas

SYRAH
-Very good ripeness flavor-fruit
-Well balanced Acidity level.
-good Tannin structure-not too much astringency
-Slightly peppery
-Can be paired very well with lightly spiced Indian
Cuisine
 Short term strategy

To cater in both red and white wines

A medium priced product
Pricing strategy- partially following the leader
Create awareness about wine benefits
To get a competitive hold in domestic market
Long Term strategy
To go international
To produce all types of wines
To produce reasonable wines
To produce health conscious wines
To setup our company outlets so its easily accessible for costumers
at low rates
To produce non alcoholic wines so that license is not mandatory for
dealers and retailers
 Strategies
Positioning Segmentation Promotion

Only alcohol good for Cities/Metros Celebrity Endorsement

health Age Wine tasting sessions at
Corporate Gifting Sex Page 3 parties.
Item Social Class Sponsor a Social Evening.
Life Style Drink Life Style Offer an occasional WINE
Attitude TOUR
Freebies
 Pricing strategy
 Quality Strategy : High quality with medium Price

 Price Objective : Product Quality Leadership

 Demand : Limited at beginning stage. So there is inelastic

demand

 Estimating Cost : Major costs will be grapes

plantation, Sales Promotion & Advertising

 Pricing Strategy : Chardonnay- Rs 600 for 750ml.

Syrah - Rs 540 for 750ml.
 Marketing strategy
Proper Branding- Sophistication and Classy
Create great awareness among consumers
Target the states where taxes are lower
After sales Customer Satisfaction for future
product development
Provide samples at page 3 parties
Advertising trough media as companies packaged drinking
water
Free sampling at pubs,clubs
 Swot analysis

Own Winery
Packaging
Brand Penetration

Quality

Price
Seasonal Availability of
Grapes
Consumer Mindset

SWOT

alcoholic consumption
Many me too entrants
Advertising banned

Discouragement of
Export Opportunities
Increasing awareness
Growing market size
Consumer Market & Buyer Behavior

• Object of Purchase : Combination of Quality and Taste

Quality Proposition

• Organization of Purchase : Decider, Buyer

• Operation of Purchase : High End Restaurants, Stand-alone

shops, Malls

• Occasion of Purchase : Personal Use / Social Gathering

Thank you
Disha Dhanesha
Deepali Pardeshi
Priyanka Vartak
Chandan Nagar
Shritkant Yadav
Rajesh Kurmi
Rohit Pipalwa
Shehzad Bhatt