Adil plans heady mix for JDL after Diageo

BANGALORE: Serial entrepreneur and former Diageo honcho Asif Adil is scripting a new play in the spirits business. After revving up the premium drinks space for Diageo brands, Mr Adil, who is at the helm of John Distillers (JDL), is now uncorking probably a more difficult story in the regular-priced market.

The Adil story for JDL is one of tact: Move aggressively in the mainstream market even as USL and Radico Khaitan intensify their efforts in the premium segments. In doing this, he will propel JDL from a Rs 450-crore to
Rs 1,000-crore company by 2012. JDL, one of India���s top five liquor marketers by volume, is rolling out a new vodka Salute pitched against USL���s White Mischief and Romanov brands.

The two USL brands have over 80% share of the regular-priced vodka segment. JDL, which sold close to 10 million cases mainly through its flagship brand Original Choice Whisky last year, is also set to launch a regular whisky Grand Duke priced slightly above USL���s blockbuster volume brand Bagpiper.

Salute Vodka ��� with a Russia-inspired party positioning ��� will go for a national roll-out next month. Grand Duke Whisky will hit Andhra Pradesh initially, which happens to be the largest market for Bagpiper. On the cards is a third brand, Mont Castle Brandy, which will compete with Tilaknagar Industries��� Mansion House brand in the deluxe or semi-premium segment.

This comes at a time when brandy sales are reporting buoyancy, emerging from a prolonged slumber. ���The plan is to build pressure from below on bigger players like USL and other domestic rivals as they lock horns with MNCs in the upper-end. JDL is a small and nimble-footed firm working out a gameplan in the regular-priced businesses. We do have strong distribution in several large markets, especially in South,��� Mr Adil, vice-chairman & CEO, JDL, told ET. This was his first media interaction soon after completing a six-month no-compete with Diageo. Mr Adil will be holding an unspecified small equity stake in JDL.

Mr Adil expects faster value growth for the company as new brand introductions gain ground. Currently, Original Choice is a volume game in the economy segment working on narrow margins. ���The challenge will be to improve margins, and frankly, I expect our value growth to be significantly faster than volume growth,��� he said.

But analysts pointed out that India���s spirits market, especially the mainstream play, has been a difficult hunting ground for many serious challengers in the past with high brand mortality rates and trade consolidation around established leaders being the biggest concerns.

And JDL has already kicked-off a fund-raising plan to get going. It has appointed investment bank JM Financial to raise Rs 150 crore divesting 20-25% stake by December this year. This values the company at around Rs 600-700 crore.

JDL has owned primary distillation facilities in Goa and in Maharashtra, apart from a network of contract bottling units across the country.