Consolidation of the Indian wine industry took an important step in 2012 with the merger of Karnataka-based Grover Vineyards with Vallée de Vin of Maharashtra. If all goes according to plan, the merger will enlarge the portfolio of wines offered, strengthen the marketing and distribution network, increase sales volume and exports, and reduce their inter-state tax liabilities.
This may sound ambitious, but then Grover Vineyards has always aimed high. For a start, there can’t be too many winery owners who have previously been involved in Space Exploration. Yet Kanwal Grover, founder of Grover Vineyards, could make such a claim having made his fortune from the importation into India of high-tech equipment, mainly from France. This French connection also piqued his interest in wine and greatly aided the transformation of his dream of producing quality wines in India into reality.
Beginning in the early 1980s, Kanwal Grover, together with French consultant Georges Vesselle, began looking at potential sites throughout India. Thirty three different varietals were initially planted in experimental plots in Maharashtra, Andhra Pradesh and Karnataka, in order to determine the most suitable vines and vineyard location. The results led to nine French varietals being planted on around 16 ha of land in the Nandi Hills to the north of Bangalore. Grover also created only the second winery in the country.
Following several early undistinguished vintages, flying winemaker Michel Rolland was employed as consultant to Grover Vineyards. He, or a member of his team, regularly visit the vineyards and winery and are actively involved in the winemaking. Criticised by some for having a winemaking style which is not classical Bordeaux, his hallmarks of super-ripe fruit and smooth tanins fit well with Indian viticulture. No wonder then that Grover’s La Réserve (70% Cabernet Sauvignon, 30% Shiraz) quickly became India’s most famous red wine and garnered an international reputation. Exports to the UK began in 1999 and in his August 2005 column in Decanter magazine, Steven Spurrier declared Grover’s La Réserve 2005 to be the best New World red wine. In 2009 Grover Vineyards introduced their Art Series branded wines consisting of two whites (Sauvignon Blanc and Viognier), a Cabernet-Shiraz and a Shiraz Rosé. Priced at a ca. 25% discount to La Réserve, these wines were meant to bring the Grover name to a larger audience. Instead they suffered by being neither as high quality as La Réserve, nor as low priced as competitors’ wines.
Around 2007 the consistency of La Réserve was being questioned, which some related to the departure of winemaker Abhay Kewadkar to Four Seasons. Such quality control issues were clearly apparent in 2008, when unacceptable calcium sedimentation was observed to be occurring in bottles. To their credit, Grover Vineyards recalled wine that they suspected might be faulty and spent a considerable sum upgrading their winery facilities. Yet reputations in the wine world are hard won but easily lost, and it’s difficult not to think that the seeds of the merger with Vallée de Vin were sown at that time.
The merger has also been brought about by the industry experiencing oversupply into a domestic market which has not grown as rapidly as some had anticipated. Export sales are up against many international competitors some of whom have a lower cost base. As neither a small boutique winery, nor one which was dominating the market, Grover Vineyards was poorly positioned and finding it difficult to turn a profit.
Post-merger the Grover family and Vallée de Vin promoters (Ravi Jain, Deepak Roy and Neeraj Deorah) now own a little over 50% of Grover Zampa Vineyards. Reliance Capital acquired an 18% equity stake in return for the injection of new capital. Other owners include Michel Rolland and Ravi Viswanathan, a Singapore-based investor.
The portfolio of the enlarged group now includes still, sparkling and fortified wines across a wide range of price points. All wines will eventually be produced in both Nandi Hills and Nashik, with the stated aim being that wines from the two locations should taste as similar as possible. This will give them the ability to sell into key metropolitan markets of Mumbai and Bangalore, without incurring interstate levies, which should certainly help to improve profitability. Jain and Roy’s industry expertise ought to see further improvements in marketing and distribution. Grover Zampa Vineyards should soon be the second largest wine producer in India, albeit still quite some way behind Sula Wines.
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