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Opportunities In Wine Business

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By: Payal Jain, In Food & Drink
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Updated: Saturday, March 15, 2008
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Wine is an alcoholic beverage made from the correct fermentation of grapes. Wine can also be produced from other fruits, such as apples, pineapples, berries, plums, starch products such as rice, and a few varieties of nuts. Wine-making dates back to the very genesis of human race, with Noah as the very first winemaker the world had ever known. The Indian entrepreneurs are doing it for exploiting the Rs 1,700 crore worth market that remains to be exploited. There are currently around 125,000 hectares of land under grape-cultivation in Maharashtra, out of which around 1000 hectares is for wine-grapes. In Bangalore, there is around 200 hectares Of this, 70% is already yielding and 30% will start yielding in a span of 2-3 years, totaling the annual wine grape yield to around 15,000 tons and an average annual yield of around 0.9 crore liters of wine.

Wine is a rapidly growing category within the Indian alcohol industry. With urbanization and hedonism emerging in the Indian consumer, wine is one of the new categories that have grown as a result of this. With increased focus from governments, both state and central, as well as a widening base of producers in states such as Maharashtra, there is wider visibility and availability of wines throughout the country as well as widening price points and product types within the wine category. This has allowed for a rapid growth in the interest levels and consumption of wine in metros as well as semi-urban areas in the country. Asia as a whole is registering good growth overall with China now reaching almost 0.5 liters of per capital consumption.

Within India, glass manufacturers, corks, skilled wine-makers and skilled viticulturists are potential bottlenecks as the industry grows. Globally, differentiation in products and brands within the wine category is a major challenge that all producers face. A large degree of consolidation will occur within India with a majority of inefficient producers at lower scales of operation becoming merged into larger, more efficient businesses while more boutique wineries will also emerge within India. There will also be a greater focus on regional vineyards and its impacts on quality and styles of wine within India and the globe for Indian wines. At a global level, consolidation and efficiency of production are key factors to success.

Another professional who juggles a corporate career with winemaking is Ramesh Rao of Mandala Valley Wines. He started Mandala a few years back in Bangalore and tied up with a few grape growers in Maharashtra for supplying wine grapes. Yatin Patil of Vintage Wines is credited with having grown Italian wines in India. There are also those who source wine grapes from local growers in addition to in-house harvesting. Whether it is the established makers or fresh entrants, they all have one thing in common which is a passion for wine and money.
Almost every other week a new brand of wine is getting launched. The rising demand is attracting even more entrepreneurs and established corporate individuals into turning vinopreneurs.

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