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Time of India
6 days ago
- Business
- Time of India
A home-grown liquor giant is making a bold pivot
The making of India's brandy boss Live Events You Might Also Like: India-UK FTA will make Scotch whiskies more competitively priced: Pernod Ricard India You Might Also Like: Alcohol makers seek phased import duty cuts, strong safeguards to prevent EU FTA misuse From brandy to whisky You Might Also Like: Amrut launches its ₹10 lakh marquee Indian single malt whisky (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel Amid a rapidly transforming market, one of India's home-grown liquor producer is taking a sharp turn. Premium brandy manufacturer Tilaknagar Industries Ltd, the owner of India's biggest and the world's second biggest brandy brand Mansion House , is reportedly eying a big foray into whisky business. ET has reported based on information from people familiar with the matter that Tilaknagar Industries is the frontrunner in the race for the Imperial Blue whisky brand being sold by the French alcobev major Pernod Ricard Imperial Blue, Pernod Ricard's largest brand by volume, has an estimated enterprise value of up to $600 million, as per the ET report, and a deal will mean the largest M&A in India's liquor industry in more than a decade after Diageo's buyout of United Spirits in 2013 for $1.9 billion. Chairman-cum-Managing Director Amit Dahanukar refused to comment on ET's query on the proposed has been asked to submit a binding bid by June 23, as per the ET report, while Inbrew Beverages , established by London-based serial entrepreneur Ravi Deol, is also in the is one of the biggest markets for brandy, accounting for nearly 40% of the overall consumption globally. In India, brandy is the second most consumed alcoholic beverage after whisky, but more than 98% is sold in southern India, especially Kerala and Tamil Industries, or TIL, India's fifth-largest alcoholic beverage firm by market cap, is the leader by far in India's brandy business. The company enjoys a leadership position in the segment with 94% of total volume) in the IMFL industry, with a market share of nearly 25%, excluding Tamil Nadu, as per a CRISIL analysis from December last year. Within the prestige and above segment, TIL has around 30% market share. Brandy is the second largest in the spirits category, forming over 20% volume share after whiskey (55%).Tilaknagar was founded in 1933, as The Maharashtra Sugar Mills Ltd by Mahadev L Dahanukar. In the 1970s, the company shifted its focus to alcohol production, and soon became a prominent manufacturer of alcoholic beverage (alcobev) brands in India. Tilaknagar is the maker of India's highest-selling premium brandy brands, Mansion House and Courrier Napoleon. The company offers over 15 different brands of brandy, whiskey, gin, rum and vodka, with a focus on the 'prestige-and-above' segments. Manufacturing operations span 19 units, including 4 owned units and 15 contract manufacturing company has a strong distribution network of nearly 40,000 outlets across the country, and sells mainly through state corporations, direct sales, and distributors. It also exports to Africa, Middle East, East and South-East Asia and Europe, as per CRISIL. Tilaknagar is a major player in south India, which accounted for around 86% of total revenue. The promoters have experience of more than five decades and strong relationships with dealers/distributors. CMD Amit Dahanukar joined the board in 2001 and has been instrumental in guiding the company through its troubled phase and reviving the business forms nearly 20% of the overall IMFL market in India. Tilaknagar is the largest player in the brandy segment with nearly 25% market share excluding Tamil Nadu (market dominated by local players). Tilaknagar has a strong foothold and brand-recall in South Indian states (AP, Telangana, Karnataka, Kerala and Puducherry). In fiscal 2024, the company sold over 11.2 million cases (1 case = 9 litres), reflecting 16% increase compared to fiscal 2023, with southern states contributing 86% of the volume, as per Tilaknagar, a successful acquisition of Imperial Blue would help expand its brand as well as non-brandy portfolio. While brandy is a dominant category in Tilaknagar's portfolio, the company forayed into whisky in 2012, leveraging flagship brand Mansion House. However, more than 90% of its sales still comes from brandy. During its earnings call on May 21, chairman and managing director Dahanukar said Tilaknagar will focus on enhancing its presence within brandy and other IMFL categories through its own brands and strategic investments. Tilaknagar had earlier acquired Round The Cocktails, Spaceman Spirits and Incredible Spirits. Tilaknagar has been in a long-drawn trademark dispute with Allied Blenders & Distillers (ABD) and Dutch distiller Herman Jansen Beverages (formerly UTO) over its Mansion House if it indeed ends up buying Imperial Blue, will be making a big push into the whisky market when it is in ferment. After several years of growth, demand for spirits across categories slowed down to 1.6% in FY25, falling from 4.2% a year ago. Volume sales of whiskey, which accounts for roughly two-thirds of the market, saw a muted 1.5% increase in volume last fiscal while brandy and vodka sales were flat, according to excise department data reported by ET. Brandy grew less than 1%. Globally too, liquor sales fell 1% by volume in 2024, according to alcohol market researcher IWSR, which attributed this to large markets such as China and India failing to live up to growth projections. Spirits slowdown in India has been attributed mainly to distribution changes in a few states, higher taxes and tipplers cutting back on most discretionary spends including these disruptions, liquor industry in India holds immense potential. Despite being the world's most populous nation with more than 1.4 billion inhabitants, India's drinking consumer base is estimated at around 300 million-of whom nearly half rely on cheap, unbranded 2024, India's alcohol industry is valued at approx. $64.19 billion with projections indicating it could reach $115.27 billion by 2034 at a CAGR of 6.7 per cent, as per an ET report. Spirits like whisky, vodka and rum are expected to dominate the market reaching USD 50.55 billion by 2034. India remains one of the world's largest consumers of whisky, accounting for over 48 per cent of global whisky liquor industry is transforming in response to consumer trends and policy shifts. Premiumization and innovation are driving growth, with consumers willing to pay more for craft breweries, premium whiskies and flavored spirits. Companies are adapting by launching unique offerings tailored to local tastes. Meanwhile, although e-commerce restrictions remain in place, some states are exploring online liquor delivery, which could unlock new growth opportunities. Policy reforms are also gaining momentum, with increasing pressure on state governments to streamline tax structures and modernize the industry. Progressive moves by states like reduced state duties by 10-15 per cent across various alcoholic beverage segments in Karnataka suggest a shift towards a more business-friendly the FTA with the UK, which includes deep cuts in import duties on several spirits, and a possible trade deal with the US can make make imported liquor more affordable in India which may challenge local liquor brands in the premium and luxury space, Imperial Blue whisky brand may not be impacted much as it straddles the space between mass and premium.
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Business Standard
6 days ago
- Business
- Business Standard
Tilaknagar tops $600 mn race for Imperial Blue, to expand whisky portfolio
Tilaknagar Industries, known for its Mansion House and Courrier Napoleon brandies, is emerging as the front-runner to buy the popular Imperial Blue whisky from French alcohol giant Pernod Ricard, according to a report by The Economic Times. The Imperial Blue brand is estimated to be worth up to $600 million. If the deal goes through, it will be the largest acquisition in India's liquor sector in over a decade — after Diageo's $1.9 billion buyout of United Spirits in 2013, the news report said. Inbrew Beverages, founded by London-based entrepreneur Ravi Deol, is also interested in acquiring Imperial Blue. However, Pernod Ricard found Tilaknagar's offer more attractive, though Inbrew has not been completely ruled out, The Economic Times mentioned. Tilaknagar, India's fifth-largest alcohol company by market value, has been asked to submit a binding bid by June 23. Funding the deal If the deal goes through, it will be funded through a mix of internal resources, bank loans, and private equity investment. Japan's Suntory Holdings, which owns brands like Jim Beam and Maker's Mark, initially considered bidding for Imperial Blue but later decided not to move forward. For Tilaknagar, led by chairman Amit Dahanukar, buying Imperial Blue would be a big step in diversifying its portfolio. While the company entered the whisky segment in 2012 using its flagship Mansion House brand, over 90 per cent of its sales still come from brandy. During its earnings call on May 21, Dahanukar said the company plans to grow its presence in brandy and other Indian-made foreign liquor segments through its own brands and strategic acquisitions. Tilaknagar has previously acquired Round The Cocktails, Spaceman Spirits, and Incredible Spirits. Imperial Blue's journey Imperial Blue was first introduced in India in 1997 by Canadian distiller Seagram. In 2001, Seagram sold its global business to Pernod Ricard and Diageo, with Pernod Ricard taking over the Indian business. The following year, Imperial Blue was relaunched with the memorable slogan, 'Men will be men', which helped build a strong following. Today, Imperial Blue is the world's eighth best-selling whisky, selling 22.8 million nine-litre cases in 2023, according to Drinks International's Millionaires' Club. However, this is down from its 2019 sales of 26.3 million cases, the news report said. This potential sale echoes Diageo's decision in 2022 to sell 32 low-margin Indian brands — including Haywards, Old Tavern, White Mischief, Honey Bee, Green Label, and Romanov — for ₹820 crore to Inbrew. Deol, who started Barista Coffee in 1999 and earned a reputation as India's 'coffee man', aims to make Inbrew a leading player in the alcohol industry by acquiring Imperial Blue.
Times
16-05-2025
- Business
- Times
Rachel Reeves wants your pension to back Britain. It could cost you
A big shake-up to pensions could leave savers worse off, while the government continues its drive to get pension firms to invest more in unlisted companies. A deal struck by the pensions industry on Tuesday will result in 17 pension companies, which together manage about £252 billion of savers' cash, investing at least 10 per cent of workplace pensions into private assets by 2030. The so-called Mansion House accord will affect the estimated 14 million savers who have a defined contribution pension (where the amount you get in retirement depends on how much you invest and how your investments perform) in their pension firm's default scheme. These are investment funds selected for you by your pension company — 90 per cent of defined contribution savers
Yahoo
13-05-2025
- Business
- Yahoo
Lloyds snubs Reeves's push to back British companies
Lloyds Bank has snubbed Rachel Reeves's push to get pension funds to invest more in the UK, dealing a blow to the Chancellor's bid to boost growth. The lender's pension arm Scottish Widows has refused to sign up to a pact that will see Britain's largest retirement funds invest £50bn in infrastructure, property and private equity by the end of the decade – half of which will be in the UK. The Telegraph first revealed details of the updated agreement last month, known as the Mansion House Accord. The deal will see 17 workplace pension providers invest 10pc of their defined contribution pension schemes in private assets, in a radical attempt to kickstart the economy. It comes after the Treasury spent months pressuring investment companies to invest more in home-grown projects, with ministers at one point calling for up to 10pc invested in the UK alone. The original Mansion House agreement, spearheaded in 2023 by Ms Reeves's predecessor Jeremy Hunt, aimed to boost growth by pledging a minimum 5pc of workplace pension savings into privately-owned companies by a thinly veiled jibe at the Government's plans, Chirantan Barua, Scottish Widows' chief executive, said that the need to buy British assets was the primary reason it refused to sign the updated Barua boasted that his division, which manages more than £100bn of workplace pension assets, is already heavily invested in the UK, but insisted that future investment decisions would be guided solely by returns instead of geography.'We will continue this investment approach to support our communities where it generates strong returns for pensioners,' he Widows was previously one of the biggest workplace pension funds to sign the first Mansion House accord. As an arm of Lloyds, Britain's largest domestic bank, Scottish Widows has 10m retirement and savings customers. The group, founded in 1815, is best known for its iconic widow character dressed in a black hood and cape who has appeared in adverts since the 1980s. Sources said Scottish Widows was among a handful of original signatories – including Aegon, Aviva, L&G, Nest and Standard Life-owner Phoenix – which had raised concerns about the rewriting of the original pact. Some pension providers were reluctant to specify a UK target within the broader 10pc commitment, though others were prepared to go further and commit as much as 15pc of savers' cash to private markets. '[Scottish Widows] were almost a flat-out no from the start,' said one City source. Other sources suggested two of the signatories to the updated pact told the Treasury that going above 10pc invested in private markets was a 'red line'. Another City source said: 'Above that we wouldn't sign.' Scottish Widows is already heavily invested in the UK – including 7.6pc of its £72bn default pension investments invested London-listed shares. However, it is unclear how much of their default funds are currently invested in private markets. It is understood that the Treasury will also give itself powers to force pension funds to invest in UK projects if they fail to comply with the new accord, in a process known as mandation. 'Progress against the commitment will be monitored and the initiative will be reinforced by measures to be announced in the upcoming final report of the Pensions Investment Review,' the Treasury said, with further details set to be outlined this month. Several retirement giants have already warned that pensioners will be worse off if Ms Reeves strong-arms retirement funds to invest more into the UK. Benoit Hudon, chief executive of Mercer UK, which has signed the Accord, told The Telegraph last week that pressuring fund managers to plough pensioners' savings into unlisted UK assets could backfire, because they may deliver worse investment returns than rival opportunities abroad. 'The ultimate result of a mandate may be lower returns for pensioners and poorer pensioners in the country – which goes completely against the fundamental objective of this proposal,' he said. Ms Reeves said she hoped the deal would help get Britain to net zero. 'I welcome this bold step by some of our biggest pension funds, which will unlock billions for major infrastructure, clean energy, and exciting startups – delivering growth, boosting pension pots, and giving working people greater security in retirement,' she said. A Scottish Widows spokesman said: 'We remain committed to the original Mansion House Compact target of investing 5pc of our default funds in unlisted equities by 2030.' Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
13-05-2025
- Business
- Yahoo
Pension funds ‘to unlock up to £50bn' of investment, with half for UK firms
The bosses of 17 of the UK's biggest pension funds have struck a deal with the government that it claims will release up to £50bn worth of investments, with at least half earmarked for British assets including clean energy projects and homegrown startups. Fund managers including Aviva, Legal & General, M&G, Phoenix and the Universities Superannuation Scheme have agreed to sign a new 'Mansion House accord' that will lead to at least 10% of their workplace pension schemes being invested in private market assets by 2030. Half of that money (5%) will be earmarked for UK investments, including stakes in private British businesses, property and major infrastructure projects, all areas of focus as the government tries to kickstart the economy. Related: Reeves's Mansion House accord on pension funds is long on virtue-signalling The new accord doubles the size of commitments made under a deal arranged by the Conservative government in 2023, known as the Mansion House compact. Led by the then chancellor, Jeremy Hunt, signatories agreed to allocate 5% of funds to private assets, with no stipulation about keeping any of that money in the UK. The chancellor, Rachel Reeves, said: 'We are choosing to back British businesses and British workers. I welcome this bold step by some of our biggest pension funds, which will unlock billions for major infrastructure, clean energy and exciting startups.' However, some pension fund providers are understood to be wary about any government efforts to force firms to put money into British assets, which could result in poorer returns for retirees compared with overseas investments, possibly breaching their fiduciary duties to clients. While the accord itself does not mandate UK investments, there are concerns that the pensions bill, due later this year, could leave the door open for the government to dictate how fund money is used. Zoe Alexander, the director of policy and advocacy at the Pension and Lifetime Savings Association, said the government, for its part, had 'committed to take action to ensure there is a strong pipeline of investable assets for pension schemes. With everyone playing their part, there is great potential to boost returns for savers while providing vital funding to productive growth areas.' The voluntary pact covers signatories' defined contribution pension schemes, which do not guarantee a set income at retirement, and are the default plan for most UK workers. The 17 signatories, which also include Aegon UK, Aon, M&G and Mercer, manage combined portfolios currently worth £252bn, suggesting UK investment commitments worth just £12.6bn. However, the government's calculations predict those portfolios will grow by about 17% per year, and possibly further under government pressure to consolidate retirement schemes into national 'megafunds' that are intended to replicate success stories in Canada and Australia. The Treasury believes that will leave the pension providers with portfolios worth £740bn by 2030, and roughly £50bn of new funds for private market investments, when discounting for existing commitments. Around half that – £25bn – would therefore be aimed at UK projects and startups. Many pension providers already allocate funds to private assets, including in the UK, meaning that it may not necessarily lead to a large injection of cash from individual pension providers. The Mansion House accord comes as the government tries to tackle concerns about a lack of domestic investment in the UK. But the Treasury has been juggling competing interests, with lobbyists also calling for reforms that could simultaneously boost ownership of stock-exchange listed companies. London lost out on a raft of blockbuster listings in recent years, including by UK chip designer Arm, which opted to list on Wall Street in August 2023. The buy now, pay later company Klarna followed suit, while other companies such as Paddy Power owner, Flutter, and the travel company Tui opted to switch their primary listings from London to rival hubs such as New York and Frankfurt. However, the metals investment company Cobalt Holdings bucked the trend on Monday, announcing plans to float in London in June in a rare boost to the UK stock exchange. Cobalt is planning to raise roughly $230m (£174m), with commodities trader Glencore due to take a 10% stake. The government is also expected to launch a consultation in coming weeks on a possible shake-up of the Isa market to incentivise more investment in British stocks via the tax-free accounts. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
