Shaw Wallace eyes country liquor mart

Liquor major Shaw Wallace plans to enter the Rs 18,000 crore (Rs 180 billion) country liquor market this year to broaden its product portfolio and boost revenues.

A top company official said on Thursday that leading management consultants, including McKinsey, were advising the company on the latest venture.

"We plan to garner sales of about five million cases worth Rs 300-500 crores (Rs 3-5 billion) during the first year of operation in the country liquor market through the branded route. The products will initially be launched in key markets like Maharashtra and Uttar Pradesh before going national," Shaw Wallace's head of traditional businesses Deepak Chaudhuri told PTI.

The domestic country liquor market, mostly accounted for by the unorganised sector, is the largest segment in alcoholic beverages sector, both in terms of volume and value.

As per available data, the market is currently pegged at 220 million cases as against Indian made foreign liquor segment, which is at an estimated 75 million cases, roughly one-third of country liquor.

"Country liquor segment holds immense potential for growth for Shaw Wallace due to our strong brand building skills and nationwide manufacturing and marketing infrastructure. We plan to provide brands at all price points for carving a bigger pie of the Indian liquor segment," Chaudhuri said.

Uttar Pradesh, Maharashtra, Bihar, West Bengal, Punjab, Haryana and Madhya Pradesh account for nearly 50 per cent of all country liquor sales in India.

This market is growing at about seven per cent annually and is expected to touch 300 million cases by 2010.

"In country liquor, there also exists an opportunity to build on the early mover advantage for Shaw Wallace, which has strong synergy in manufacturing and distribution of Indian made foreign liquor," Chaudhuri said.

The per capita consumption of country liquor at 1.8 litres annually is the highest amongst all the alcoholic beverages, with beer and spirits being 0.6 and 0.8 litres respectively.

Shaw Wallace presently produces premium spirits like 'Antiquity' and 'Royal Challenge', which account for over 60 per cent of sales in this segment.

It also makes the mid-priced 'Director's Special' whisky as well as 'White Mischief' vodka.