Tag Archives: Indian spirits market

Tilaknagar Industries reports 82% PAT growth in Q2

  • Expansion plans in East and North-East markets
  • TI leverages Samsara brand equity, soon to launch range of luxury products

Leading Indian-Made Foreign Liquor (IMFL) manufacturer, Tilaknagar Industries Limited (TI) has reported a profit after tax excluding exceptional items (PAT) of ₹58.2 crore, implying a growth of 82.4% over the ₹31.9 crore PAT reported in the corresponding quarter last year. The earnings before interest, tax, depreciation and amortisation (EBITDA) at ₹66 crore grew 39% over the ₹47.4 crore EBITDA reported in Q2 of the previous year.

Significantly, the company’s EBITDA margin expanded 422 basis points year-on-year (YoY) to 17.6%. Adjusted for the subsidy income, EBITDA came in at ₹56 crore, at a margin of 15.3%, showing 188 basis points expansion YoY. This growth in profitability was witnessed despite muted growth in net revenue from operations, at 5.8%, to ₹374.9 crore due to a temporary slow-down in growth, caused by policy transition in one of company’s key markets, Andhra Pradesh, which has recently opened liquor retail to private parties in the state.

Amit Dahanukar, Chairman and Managing Director, Tilaknagar Industries said, “With retail going private in Andhra Pradesh mid-October onwards, we expect to continue with our industry-beating growth trajectory, achieved through a combination of doubling down on our market share gains from our brandy portfolio as well as our new product launches across categories.”

The company that has a strong foothold in key markets of South India, as well as certain markets in East India, recently launched Mansion House Gold Barrel Whisky in Assam. With this launch, the company plans to further expand into the East and the North-East markets where whisky enjoys an 80% share of IMFL market in the East and North-East markets.

TI’s flagship brand Mansion House Brandy is India’s highest selling brandy and the eighth-largest selling spirits brand across categories, while its second millionaire brand, Courrier Napoleon Brandy has emerged as the third-fastest growing spirits brand globally. The company plans to creatively invest in advertising and sales promotion to provide a meaningful share of voice to the brandy category in the overall IMFL market.

During the quarter under reference the company become net debt free, nearly six months ahead of its original target date for achieving the net debt-free status. “From a peak debt more than ₹1,100 crore in March 2019, to achieving the net debt free status, we have come a long way. This transformation was achieved through a combination a financial prudence and achieving industry-beating profitable growth,” Dahanukar added.

The company attributes the growth in profitability to superior brand-mix as well as effective cost-optimisation initiatives. With the worst of the inflationary cycle over, the company anticipates further growth in profitability in the upcoming quarters.

Recently, the company moved to increase its investment in Spaceman Spirits Lab Pvt. Ltd. (SSL), maker of Samsara Gin and Sitara Rum, to 20% from the earlier 10%. TI will leverage the Samsara brand equity to showcase a robust luxury portfolio, along with its soon-to-be launched range of luxury products.

Whyte & Mackay: Looking to Craft a Legacy in India’s Evolving Whisky Market

As the Indian whisky market evolves with the introduction of newer and more premium products, Indian consumers are increasingly gravitating toward ultra-premium spirits. Whyte & Mackay (W&M), originally acquired by USL (later Diageo) and eventually sold to the Philippines-based Emperador Distilleries, has made its offerings available in India through VBev. In a conversation with Bhavya Desai, James Cordiner, International Malt Specialist at W&M, and Sumedh Singh Mandla, CEO, AWS Global and VBev, shared perspectives on their portfolio, market strategy and future plans. Excerpts:

Whyte & Mackay’s current portfolio in India spans both the ultra-premium and premium segments. The lineup includes the renowned Dalmore single malt, available in age statements of 12, 15, and the Port Reserve edition, while the premium range features Jura single malt, offered in 10- and 12-year-old variants.

James Cordiner, International Malt Specialist at W&M

In addition to Dalmore and Jura, the company plans to launch the Tamnavulin single malt at the end of this year or early next year, with Fettercairn single malt also in the pipeline.

James Cordiner, who recently joined W&M, is no stranger to the Indian market, given his previous tenure at Bacardi. He is impressed by India’s passion for whisky. “It’s a huge whisky market and one that’s growing rapidly as consumers become more adventurous and curious,” he observes.

Sumedh Singh Mandla, CEO, AWS Global and VBev

Both James and Sumedh recognize that while Indian consumers are leaning toward premium spirits, Dalmore is positioned at a higher price point (₹14,300 per bottle in Mumbai). Nevertheless, they are optimistic that consumers will connect with the brand’s heritage, craftsmanship, and royal legacy dating back to 1839. James emphasizes that the cask selection and meticulous production process are what set these whiskies apart.

Despite the competition in the segment, Sumedh is confident that W&M’s products can carve out their own niche, particularly with the rise in consumers’ purchasing power. For those who find Dalmore’s price point steep, Jura offers a more accessible option.

Currently, the brand’s strategy includes advocacy and education initiatives targeted at on-trade establishments, with activities expected to commence soon. W&M products are now available in approximately 20 tier A and B cities, and they are also looking to go more vertical in the States that they are already available in. For instance, in Maharashtra –  expanding to other cities like Nagpur, Pune, Kolhapur etc apart from Mumbai. Although the top line products might not be made available in these markets, but they tend to surprise W&M in terms of aspiration and growth.

But growing that market comes with its challenges and fluctuating price points, shifting regulations in each State hamper the expanding market reach. Additionally, securing sufficient supply quotas for wider distribution also remains a concern, which a more streamlined regulatory framework could address.

Sumedh mentions an example: if a regulator requires a barcode to be repositioned on the bottle, it’s difficult to implement such changes after the labels have already been customized. A standardized policy would simplify these processes and accelerate growth across the segment.

James admires the progress of Indian single malts, noting, “You’ve got some fantastic whiskies being produced in India.” He points out that Scotland’s cold climate allows for extended maturation periods, resulting in more complex and nuanced flavour profiles that can develop over decades. By contrast, India’s warmer climate accelerates maturation, but might limit the depth of flavours that can be achieved within 10 to 12 years. Nonetheless, he believes that India’s single malt journey will play a key role in shaping the country’s luxury whisky market for the future.

Interestingly, the demand for luxury products is surging in smaller cities, with on-trade partners requesting more stock of premium offerings like Dalmore. Clearly, Dalmore is being positioned as an aspirational brand, catering to discerning consumers who appreciate fine spirits. But interestingly, their messaging isn’t solely targeted at men, but also at women who have reached a certain level of accomplishment in their professional and personal journeys. Moving forward, the brand plans to conduct more high-profile events to engage with affluent consumers and reinforce brand loyalty.

For those already familiar with single malts and seeking an elevated experience, W&M aims to meet their expectations. Even with Dalmore’s luxury pricing, Sumedh doesn’t see this as a major hurdle. He anticipates that as duties gradually decrease over time, products like Dalmore will become more accessible to a broader audience, growing India’s journey further.

It is clear that Whyte & Mackay’s legacy, which is built on over 175 years of whisky-making expertise, steeped in tradition and a pursuit of quality, has grown into one of the most respected names in Scotch whisky, renowned for its craftsmanship and innovative blending techniques. From the luxurious Dalmore with its rich heritage dating back to 1839, to the adventurous Jura and the approachable yet complex Tamnavulin, their current whisky portfolio offers whisky enthusiasts an option at every stage.

As the Indian whisky market continues to evolve, W&M’s commitment to delivering exceptional products, combined with its focus on storytelling and education, positions it in a strong footing for the future.