Grover Zampa sharpens focus on premium wines after ₹90 cr capital boost

“Wine is being sold on many more social occasions, so the category is expanding gradually and steadily, and the industry has been growing in double digits. In the next 6-7 years, it will reach its inflexion point," Sumit Jaiswal, the winemaker's chief operating officer, told Mint.

Jaiswal said the company's focus shifted to premium wines after its two acquisitions in 2019 as “consumers are now looking for more premium offerings, and the margins are also healthy". 

The brand competes with Sula Vineyards and Fratelli Wines in India, mostly catering to ₹500-2,000 price categories. One of its premium offerings, Zampa Insignia, sells for ₹4,000-5,000 per 750ml bottle, depending on the state. Frattelli's J’Noon sells for upwards of ₹3,900.

In 2019, the company invested in new technology and acquired two wine businesses. Grover Zampa and its investor, Dubai-based Quintela Assets Ltd, took over United Spirits Ltd's Four Seasons Wines Ltd for ₹31.86 crore. Before that, Quintela Assets acquired Charosa Wineries Ltd from Hindustan Construction Co. Ltd for ₹1.76 crore.

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Subsequently, the company went through a consolidation phase just ahead of the covid-19 outbreak, the timing of which, he added, "was not great". Its plans had to take a backseat due to the pandemic-led slow patch. 

"The pandemic became quite a slow period for many wine businesses because supplies were disrupted. However, during this period, we launched about 6-7 new premium wines, and they did well for us," he added. 

For example, it launched its Signet series, priced at ₹4,000, in 2022. 

The winemaker, who had been selling 320,000 cases of wine until 2019, targets selling upwards of 180,000 cases in 2024-25. 

A wine bottle is sized at 750 ml, and a standard case of wine consists of 12 bottles.

Capital boost 

Grover Zampa, whose vineyards are spread across 1,200 acres in Karnataka's Nandi Hills and Maharashtra's Nashik Valley, received a ₹90 crore capital boost in 2024 from its majority owner Chennai-headquartered AV Thomas Group, a tea manufacturer and exporter.  

"We now want to build our business further in states, such as Uttar Pradesh, Uttarakhand, Madhya Pradesh and Chhattisgarh, which have traditionally not been our strong markets," Jaiswal said, adding that the winemaker has its biggest markets in South India.  

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Jaiswal said the regulatory environment is often challenging to the wine business in the country. “Wine is agricultural, and often, that is not considered while making policy decisions. Most wines around the world are generally created to age about 2-3 years, not 10-12 years. So farmers are quite reliant on grape production that year. Most of our revenues also come from 2-3-year-old wines."

The company is also committed to enhancing its wine tourism properties in Bengaluru and Nashik, focusing on renovations and expanding its hospitality services. We needed to renovate our wineries and hospitality services within those. We have also invested in new machinery like tanks, crushing equipment, and bottling capacity and are looking at capacity expansion in Nashik and Bengaluru," Jaiswal said.

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Grover Zampa was founded in 1988 as an association between George Vesselle, former technical director of Champagne Mumm Vineyard in France's Reims, and Kanwal Grover. 

It saw a turnover of approximately ₹70 crore in 2023-24, Jaiswal informed.

The wine industry prospects 

Though India’s wine market is growing quite slowly, wine consumption has been steadily increasing. According to the most recent data available from the Agricultural and Processed Food Products Export Development Authority, by 2019, wine production rose to 17.6 million litres or 1.96 million cases across 6,000 acres of production area.

According to international drinks consultancy IWSR, India's wine market is projected to grow at 10% per annum till 2027.

In 2022, India's consumption by volume of wine increased by a healthy 19%, spirits in general climbed 2%, beer rose by 38%, and albeit on a very small base, ready-to-drink products surged 40%.

India is also a big importer of wine. In 2023, it imported as much as $433 million (6.7 million litres) in wine products. Brands like Fratelli and Sula are ramping up their production to meet this demand, positioning themselves for significant growth in a rapidly maturing market.

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Fratelli Vineyards, which debuted on stock exchanges in August, is looking at becoming a ₹650 crore business by 2028. In 2023-24, it had a gross revenue from operations of about ₹247 crore. Of this, 70% came from categories like luxury, super-premium and premium segments. 

Similarly, Sula Vineyards, the largest winemaker in the country, in 2023-24 had 75.2% of its revenue coming from “elite and premium" wines. Its total revenue from operations stood at ₹608.65 crore in 2023-24, growing 9% over 2022-23's ₹ ₹553 crore and a net profit of ₹32 crore.