Raise a toast: Goodricke Group to venture into wine market

KOLKATA: It's now final. After almost a year-long survey, Goodricke Group (GGL), one of the leading premium tea producing companies in the country, has taken the decision to diversify into wine. The company will launch wine in the Indian market in January ’07.

Talking to ET, GGL managing director (diversification) KS David said: “Camellia, our UK parent, has given a green signal to GGL’s diversification plan. Liquor marketing is completely new to us and we are now busy in setting up distribution channels.”

Wine will be supplied to GGL by Linton Park, the wholly owned subsidiary of Camellia in South Africa. Linton Park has thousands of hectares under vineyard operations in South Africa and makes wines such as Sauvignon Blanc, Chardonnay, Shiraz, Cabarnet, Sauvignon and Merlot.

The company also produces edible nuts, table grapes, wine grapes and wine citrus in South Africa. Mr David, who returned from South Africa on Monday, after finalising the diversification plan, said that initially GGL would import wine from South Africa.

At a later stage, the company has plans to set up its own bottling unit to bring down cost. The company's move to diversify into wine has been prompted by the recent growth of wine market in India. India's wine market is estimated at five million bottles a year - equivalent to around 200 people sharing one bottle.

Wine makes up less than 1% of India's $1.8 billion alcoholic drinks market. But the wine market is growing at 25%-30% a year, nearly three times as fast as beer, whisky or rum. Mr David said: "Once we establish our wine brand in the Indian market, GGL will then diversify into other agriculture crops. We are currently working on our next diversification plan." It may enter into edible nuts like pistachios, citrus fruits, rubber and avocados.

GGL's parent already has a strong presence in these crops. Although largely in bulk teas, GGL over the years has moved up as a branded packeteer with a host of brands and competing with industry leaders like HLL and Tata Tea. The tea major is strong in states like Madhya Pradesh, Punjab and Jharkhand.

Goodricke is also working to take on new markets such as Philippines and Taiwan with its instant tea for various uses such as flavoured tea, tea tablets, powder for RTDs, tea paste and designer teas in these markets. The company puts about 6 million kgs of tea into packets and has no plans to come up with new brands immediately. The emphasis is on consolidation and growing the existing market.