After successfully being a promoter, that launched Rock & Storm Distilleries is now branching out to start Brew Pubs under the brand name “The Brew Estate” across the country. Arundeep Singla, from Sunam in Punjab, who had launched Rock & Storm Distilleries in 2015 with a clutch of regular, prestige and premium segment beverage alcohol brands, is now onto his second venture establishing the largest chain of brew-pubs in the country under the banner of The Brew Estate. Arun prides himself in the innovative flavours of freshly brewed beer ingredients for which he imports from Germany and UK. Currently, The Brew Estate Network consists of 7 outlets across Punjab, Haryana and Himachal Pradesh, soon to be followed by other markets in the North, West and Southern regions of the country.

The venture is self funded till now. Given the market opportunity and success rate of The Brew Pub since its first launch in 2016 in Chandigarh, Arun is upbeat about attracting investors to fund his expansion.

Arun is the first generation entrepreneur in the beverage alcohol industry. His education in Australia was also instrumental in his entry into the liquor business with special interest in craft beer. Arun is an avid traveller to world brew pub markets to learn and imbibe global best practices in consumer engagement by some of the top leading craft beer brands and brew pubs.

In an interview with Ambrosia, he unveils his plans

What makes you so bullish about brew pubs?

The abundant opportunity in India both in metro and non metro cities for innovative, out of home drinkng experiences will fuel the growth of brew pubs.

What is your impression of the beer market and in particular the emerging craft beer market?

Industry and consumers need to understand craft beer – that which is artisanal, not bulk or mass. Today beer sold in bottles is called craft beer, something that defeats the purpose of introducing craft spirits. Artisanal beer is the future of the spirits industry on the innovation parameter. Large established players in the beer space have little headroom in this category. The consumer for artisanal beers is looking at reinventing his palate experience with beer every few months. Brew pubs like The Brew Estate who have introduced 60-80 flavours in the last three years, are uniquely poised to create a loyal base of consumers purely with the ability to innovate, taste, quality and the whole fine dining experience.

What is the type of pub grub would you like to pair with craft beer?

Fusion cuisine that brings out international varieties with local nuances.

What is the response to the current outlets you have?

Consumers have great brand recall and affinity for The Brew Estate for its ambience, innovation and experience. Brew pub is an evolving category. Consumers are evolving too. Regional variations from North to South need to be factored in when introducing new flavours. The Brew Estate can claim the fastest expansion in the brew pub category compared to any other player. This is a validation of consumer confidence in our brand.  

What is the current ratio of F&B in your outlets?

60/40 ratio for beverages to food. What is the kind of investment you have made in brew pub and expected for your expansion? Currently self funded, we are looking at an investiment of USD 8-10 million for the next phase of expansion.

How is the return on investment in brew houses looking at the competition in cities like Gurgaon and Bangalore? And how will you be different than others?

We have been able to control costs so far as we have stayed away from big cities. Our flavor innovations will drive footfalls and ease out cost pressures when we launch in other markets especially metros.

How many outlets you are looking for in another five years from now?

We are targeting to launch 30 outlets in three years.

Guillaume Girard-Reydet, Managing Director, Pernod Ricard India, shares his vision of the company in a volatile Indian market which is punctuated with disruptions.

How would you rate Pernod Ricard’s performance this year?

Long term strategic outlook and consistent implementation has enabled us to deliver a significant improvement in business performance. In India, after the set back on the back of demonetisation and the highway ban, we are now back on track with double digit growth. As we focus on delivering high quality brands, all our leading brands continue to post double digit growth and consolidate their market positions.

What is the secret of your success with 100 Pipers?

Bottled in India Scotch is one of the most active and competitive category in India, with new entrants launching brands every year and investing heavily in retail and media. With an amazing taste, consistent communication of its distinctive brand positioning and brand expression of “Be Remembered for Good”, 100 Pipers has been leading the scotch category for close to a decade, leaving the nearest competitor at less than half its size.

How has Pernod Ricard maintained its profitability over the years despite the disruptions in the liquor industry?

Premiumisation is a firmly entrenched trend cutting across price points, flavours and categories. We expect this trend to continue strongly in the foreseeable future, due to a positive long-term demographic and socio-economic trends led by a young and growing consumer population, rising middle and affluent class and increasing purchasing power, rapid urbanisation, and rise in women consumption.
The bouncing back of categories that we operate in due to the above and the growth was led by PRI brands as category leaders, across all segments both in our domestic and international portfolio.
Broadly, the intent is to cater to every consumption opportunity with our expansive portfolio and drive premiumisation. With brands like Royal Stag, Blenders Pride, 100 Pipers, Jameson, Chivas Regal, The Glenlivet, our constant endeavor is to offer brands with purpose and values of authenticity, legacy and craftsmanship. We also expect that responsible consumption continue to rise with consumers enjoying, the best convivial relationships with the best brands from the PRI.

There is a huge potential for blended brandy made with pure grape brandy and Pernod Ricard being a French company, it is best poised to be a dominant player in this segment. What plans have you outlined for this vertical?

Our expertise in the group with our strong knowledge on grapes within our portfolio specially cognac Martell, our wineries in Australia Jacob s Creek and Spain Campo Viejo and also our Indian wine Indiosa coupled with the blended brandy opportunity in India, is definitely a category which has potential, but it’s still to be evaluated. But we would be more focussed on the consumer value.

With gin becoming a potential promising market and India could produce good gins, what are the company plans for this segment?

Looking at the resurgence in gins and growing conversation around this versatile white spirit, we introduced Monkey 47 in the ultra-prestige gin category early this year. We have two beautiful gins in our portfolio, Beefeater the only gin distilled in London and Monkey 47 our craft gin from Black Forest. Definitely, I do agree that we are the country of flavours and spices and therefore I am sure that the whole industry is looking at us how to bring live our expertise.

Which are your thrust areas in the next three years?

With economic growth, extensive globalization and social media proliferation, Indian-made spirits are finding their space in the global markets. I would say 1. Growing our Indian portfolio 2. Consolidating leadership with International Brands and 3. Developing new areas in sync with consumer needs would be our focus and thrust areas. Our Seagram’s brands such as Blenders Pride, Imperial Blue, Royal Stag are present in over 37 countries, and have received great response. We have witnessed double-digit growth in our exports in the last fiscal year. Being optimistic, I am very confident that our industry will grow and the premiumisation trend will lead our industry. To address our consumers needs in their different moment of consumptions, our entire portfolio of international brands spanning across Scotch whiskies such as Chivas, Ballantine’s, Malts like The Glenlivet, Aberlour, to Irish whiskey Jameson, Absolut Vodka, gins such as Beefeater and Monkey 47 and Imported Wines – Jacob’s Creek and Campo Viejo remain a key focus for us.

An award-winning distilled spirits company which uses innovative accelerated ageing technology to manufacture its products will raise the quality of Jagatjit’s IMFL brands at an affordable price. The technology will also be made available to all players in the industry who choose to use it in India.

Jagatjit Industries Limited (JIL), one of India’s oldest and established Liquor company, engaged in Indian Made Foreign Liquor (IMFL),Country Liquor, Malted Milk Foods, Malt extract and Real Estate, recently announced its proposed partnership and association with Lost Spirits Technologies (LST), USA, an award-winning Los Angeles-based distillery adopting disruptive accelerated ageing technology producing whiskey and rum.

LST is a pioneer and the most successful company to have mastered and demystified the chemistry involved in the barrel ageing of spirits and has been very successful in creating technology which can replicate very high quality accelerated ageing of alcoholic spirits. LST has been widely acknowledged for its use for this disruptive technology which results in replication of a 20 year aged alcoholic spirit in a span of six days producing the same chemical signature and taste.

With this association Jagatjit Industries Limited (JIL) will enhance current product portfolio and launch new products in the premium segment using this technology in the near future. The joint venture will help Jagatjit launch a premium whisky in the next three months and reduce its dependence on imports from Scotland and the high costs associated with barrel-ageing, the company said. The partnership will also allow the technology to be made available to all players in the industry who choose to use it in India. Since India is one of the largest liquor markets in the world, it is JIL’s objective to use this technology to reduce the dependence on imports from Scotland and the prohibitive costs associated with barrel ageing. With this technology JIL will strive towards world class aged and matured alcoholic spirits which will be “Made in India”. It will also further India’s position as a world class whisky hub capable of producing top of the line alcoholic spirits at very competitive price, further reducing import costs and increasing export value.

Talking about the association, Bryan Davis, Founder & Chief Executive Officer of Lost Spirits, said, “India is the world’s largest individual whiskey market. So for Lost Spirits, choosing a technology partner in India was a very important decision. We ultimately chose to work with Jagatjit Industries for a variety of reasons. We were seeking a partner with both the manufacturing and distribution capability to follow through at scale and a management style compatible with our board of directors. We believe we found the right partner in Jagatjit and Ms. Roshini Jaiswal. After working together for the past 18 months, we are delighted to see the project progress and excited to share the forthcoming developments.”



Roshini Jaiswal, Chief Restructuring Officer (CRO) of Jagatjit Industries, said, “Jagatjit Industries has always been a company that has been on the forefront of change and innovation. The founder Late Mr. L.P. Jaiswal was a visionary who set the trend by bringing in path breaking associations to India in the form of his tie-ups with Pepsico, Ovaltine and being the first company to introduce Bottled In India (BII) scotch in the form of Teachers Whisky. True to tradition we are now announcing our association with Bryan and Joanna (co-founders of LST), an association which will allow us to reshape the industry. This partnership between JIL and LST was possible because of the synergy in the vision of Bryan, Joanna and I which has allowed us to work very successfully together in bringing the company to a scalable position in the last 18 months. This is a significant strategy for our future to remain sustainable, designed to strengthen Jagatjit Industries, and to create long-term value for our shareholders and stakeholders across the value chain.”

The move is being described by Roshini, as the last part of the overhaul process she initiated ever since she came on board about five years ago. She has tried to make the management leaner, struck debt-restructuring deals with private equity company KKR and Indiabulls Commercial Credit, strengthened distribution networks and withdrawn from loss-making markets.

Roshini added:“Jagatjit Industries has always been a company that has been on the forefront of change and innovation. True to JIL’s tradition, we are announcing our investment in LST, which will allow us to reshape the global spirits industry. Disruptive technology is the future across all business categories. Uber, AirBnb, Smartphones, Tesla, have clearly demonstrated the impact of innovative technology. The accelerated ageing process developed and patented by LST will revolutionise the global spirits industry. The quality and cost advantages of this technology are unparalleled as compared to its predecessors.”

“Our future with disruptive technology is coming after series of steps that we are taking as a part of our restructuring exercise. The restructuring exercise started with our need to create an asset light, low working capital model at the national level by embracing established and strong partners/associates in every state who would be able to effectively utilise their existing manufacturing and distribution facilities for growth at lower cost. This restructuring has enabled JIL to work on product development, packageing and the new technology for the required push necessary for our state associates. Needless to say this transition has resulted in temporary disruption in sales volumes over the last few seasons.”

Further she pointed out, “Through this investment, we have also entered into an agreement with LST specifically for the Indian market. We will not only use this technology to improve our own product portfolio (and reduce costs at the same time), but will also license this technology to others in India. Further this will also exponentially grow India as an export hub. This is a significant strategy for our future to remain sustainable, designed to strengthen Jagatjit Industries, and to create long-term value for our shareholders and stakeholders across the value chain.”

Jagatjit, set up under the patronage of the Maharaj of Kapurthala and founded by the late L P Jaiswal, will use the technology to make the product in its distilleries. The move comes at a time when legacy Indian spirits makers such as Mohan Meakin, House of Khoday and Jagatjit have been struggling to cope with the stiff competition from the larger multinationals and seen their market share dwindle. While Jagatjit did not specify the nature of the whisky it intends to make, Meakin and Khoday have launched single malts in the last few months.

• This technology was granted patent in the USA in the year 2017.
• This breakthrough technology has earned LST encomiums in the form of:
• Liquid Gold Award- Jim Murray Whisky Bible ( top 5% of Whisky)
• Best World Whisky in Dominic Rioskrow’s Wizards of whisky
• Best in Class for oven proof rum at the Miami Rum Renaissance
• Favorable reviews in Whisky Advocate Magazine
• Nominated for Craft Distillery of the Year in Whisky Magazine
• Best in Class for super premium rum from the Spirits Business UK

Tito’s hand made vodka has become a successful brand and has catapulted its founder Bert Beveridge into the Forbes top 400 richest men in the world. John McDonnell, Managing Director International, Fifth Generation Inc, shares some of the reasons the brand has become a sensation.

In 1995, Bert “Tito” Beveridge launched Tito’s handmade vodka with a philosophy “I was raised that if you are going to do something, do it right, do it better than anyone else, and charge a reasonable price.” -Tito. His philosophy has paid handsome dividends and it’s worth billions now, with $190 million in sales already and around 58 million bottles sold in 2017. To put it simply, in a 52-week year, means more than 1 million bottles of Tito’s being sold per week.

Tito’s Handmade Vodka is America’s Original Craft Vodka. It obtained the first legal permit given to one person to distill in Texas and created Tito’s Handmade Vodka. Says McDonnell, we batch distill our corn-based vodka using old-fashioned pot stills and the vodka is naturally Gluten-Free. Tito’s Handmade Vodka is distilled and bottled by Fifth Generation Inc. in Austin, Texas on the very same land where the whole venture started. Mr. McDonnell has been leading the spectacular global expansion for Tito’a Handmade Vodka – growing it in just two years from only a few international locations to 125 countries today, India being one of them. Considered as a man with a golden touch, John McDonnell, in his eight years at the helm of The Patrón Spirits Company aided tenfold increase in sales of Patron and the brand exploded in travel retail.

Vivek Chandramohan, Chief Executive Officer, Grover Zampa Vineyards, outlines the company plans as it expands in India and internationally.

   

What are the new developments happening at Grover Zampa?

We have fortified our capacities and we will continue to innovate and introduce new wines tailored to suit the Indian palate. Also, in the offing is investment on new land to build a state-of-the-art Winery in Bangalore. We have also expanded our international footprint by venturing into newer markets and are exploring newer opportunities. For starters, the recent investment by Grover Zampa’s stakeholders of Chateau d’Etroyes is a matter of great pride for us. We are the first Indian winery to have claimed stake at a French winery, situated in the very heart of France – Burgundy. Our unison aims to bring together the best of both the regions, by combining Burgundy’s traditions of winemaking with India’s fresh wine making approach and unique terroir. With this alliance, we hope to help Indian wine aficionados discover the elegance and sophistication of burgundies while allowing the transfer of knowledge between the nations for their mutual benefit. Furthermore, owing to quality of our wines and our incessant efforts to create unparalleled experiences, we are now associated with Alain Ducasse au Plaza Athénée, a Michelin 3-star restaurant in Paris along with many other Michelin-starred restaurants around the world. In terms of distribution, we are already exported to 22 plus countries and are working vehemently to increase this number.

Is there any new philosophy used for the production of wines?

Our wineries are operated by qualified winemaker Mathias Pelissard with expert consultation given by Michel Rolland and his team and Simon Robertson renowned viticulturist. The philosophy of production of wines in the vineyard remains very focused on adapting and fine tuning each wine during the growing season. We ensure that there is a rigid temperature control for both heating and cooling during all phases of grape processing, wine production and storage. The prime importance is given to the vineyard site. Its location, climate, soil, aspect, drainage, air movement, fog, row direction, training methods and most important the vineyardist’s desire to create quality fruit to make wines which are true reflection of their grape varietal and terroir. Broadly speaking here are the basic steps for making a wine: Harvest the grapes; Crush the grapes; Ferment the grapes into wine; Age the wine and Bottle the wine. During harvesting white grapes are usually picked first followed by red varietals. At Grover Zampa Vineyards, they are hand harvested rather than harvested by a machine. At the next stage, they are hand sorted on sorting tables to ensure we use the best grapes and then destemmed and lightly crushed by a machine. At this stage, the grapes for white wine (most frequently white grapes) are crushed by a press and the juice extracted leaving behind the skin. The juice is then put into tanks to allow the sediment to settle and then racked which means that the sediment is left behind and they are put into a new tank for fermentation. For red wine, after the red grapes are lightly crushed and destemmed they go straight into the tank for fermentation with skins included, which are instrumental in giving red wines their colour, tannins and richer flavour. Yeast is added in the tank for both red and white wines to allow fermentation to take place. Red wines are racked i.e. sedimentation removed after the fermentation has taken place. In terms of ageing the wine, there are multiple options. They can be aged for months or years and can be aged in stainless steel tanks or in a variety of different barrels e.g. French oak, American oak, used, toasted etc. The way that they are aged imparts different flavours to the wine.Once they have been aged, they are bottled. At Grover Zampa, the grapes are processed in a cooling room. We have controlled cellars equipped with modern resources such as temperature controlled tanks and our own bottling lines. This ensures that the quality remains uncompromised throughout the winemaking process. Winemaking is done in different tanks according to the different kinds of grape and the plot of land where the grape has come from in order to respect the specificity of each terroir. Most of the wine processing equipment and tanks are imported, mainly from Italy, which is known for being one of the best manufacturers of stainless steel cellar equipment.

How are the wines faring in the export market?

We have wines of various quality, styles and price points to satisfy the diverse demands of the Indian and International patrons of our wines. Our vision has always been to be known as the finest winemaker of India, which is translated into the efficacious wine making processes undertaken by us to ensure that our wines are always of top quality. Currently, our wines are exported to over 22 countries with the biggest markets being France, Japan, USA, Germany and UK. As a result of this commitment to quality, Grover Zampa Vineyards won 111 international grand awards for 13 wines, from 7 competitions, across 3 continents. In 2017 alone, Grover Zampa Vineyards won 21 awards at many prestigious events including the Decanter Asia Wine & Spirits Awards and the Hong Kong International Wines and Spirits Fair.

What is the total production premium wine per annum?

Grover Zampa has seen a tremendous growth in super premium and premium wines as people trade up within the category. This is a trend consistent with other alcohol categories where, for example in whisky, single malts have been seeing much higher growth then their cheaper blended counterparts. Super premium wines (wines priced at around `2000 and above) have seen around a 45% growth rate in the last year alone and continue to grow at a higher pace this year. The volume of premium wine in India currently stands at around 25 million bottles according to IWSR data (2015-2016), with Indian wine making up 75% of this volume although imported wines are gaining share. Within this category red wine dominates making up over 60% of the volume sold – being more suited to the rich and aromatic Indian cuisine. Unlike other alcohol categories, wine is bought equally by men and women, perhaps as a result of the widely held belief that wine is a healthier and more sophisticated option to other beverages. And contrary to popular belief the 25-34 age group are picking up wine as frequently as other age groups – again perhaps the result of wine’s prominence in popular culture. As of now, Premium wine is seeing good growth rates of around 10%, the highest growth of any alcohol category, but there are huge opportunities to increase this even further by exposing a youthful emerging middle class to wine and its many benefits. The total Wine production according to ASSOCHAM has reached 21 million litres from 17 million litres.

How do you view the Indian market’s prospects?

The wine industry in India has witnessed an upward progression in terms of both sales and popularity (between 10 and 15% per year). This growth has been fostered by factors such as the country’s growing affluence and increase in abroad travel that has invariably exposed Indians to the international wine scene. Of this growth, Grover Zampa Vineyards hold a significant share as the second largest winery in India and the most highly regarded brand in terms of qualitative, premium wines. Most recently, there has been a visible spike in growth of super-premium wines in India – those priced at around `2000 and above, as people trade up. According to our statistics, this category has grown by 45% in the last year which is great news for us as we focus mainly on premium wines and have two wines that fit in this category. Chêne Grande Reserve priced at around `1900 and Insignia – our single vineyard wine – which is priced at `6000 for a magnum and is only available to buy at our vineyards or to select private customers. While there was a slow-down last year because of the highway ban, the outlook this year seems robust and should continue on either 15% or higher growth rates overall.

Have you considered getting into brandy?

At this point we will stay with wine production.

What style of wines are most popular in India?

When talking of wines that are most popular I would say that the super premium wines are gaining popularity, rose is seeing growth as well. But when it comes to the growth in sales most of the premium wine sells in the Art Collection range. Prosecco and similar style of wines are also making inroads and growing rapidly in sparkling wine category. Keeping that in mind Grover Zampa will be launching something very unique in the sparkling wine range this year.