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| John Distilleries may sell 25% stake to PE firm |
| Viveat Susan Pinto / Mumbai Mar 16, 2010, 00:57 IST |
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Aims to raise Rs 150 crore to fund product expansion.
 Bangalore-based John Distilleries Ltd (JDL) is close to finalising the term sheet to dilute 25 per cent stake to a private equity (PE) firm for around Rs 150 crore, said Vice-Chairman & Chief Executive Officer Asif Adil. He, however, declined to name the investor and said the company was valued at over Rs 500 crore.
This is the first such funding for JDL and would be used for the company’s proposed expansion into different markets as well as product segments.
Tied at No. 4 with rival Allied Blenders & Distillers, JDL has a market share of about 8-10 per cent. It is eyeing a pan-India presence by increasing both production as well as the number of brands in its portfolio.
The company will introduce a slew of products in April next year, including Salute vodka, rum and gin, as well as a premium version of its Original Choice whisky, called Original Choice Gold.
It will also add some more high-end whisky brands such as Grand Duke Prestige whisky and Highland Cask in the coming months. An expansion of its wine portfolio under the Big Banyan umbrella is also on the cards. JDL sells around 10 million cases of Original Choice Deluxe whisky, its flagship brand (one case contains 12 bottles), and recently launched Mont Castle French Brandy. Adil believes all of this would grow the firm’s turnover to Rs 1,000 crore in two years.
The company needs additional manufacturing facilities to churn out these brands, for which the company is talking to third-party manufacturers. It is also putting its distribution network in place across the country.
The company has four units in Maharashtra, Goa, Karnataka and Chhattisgarh. It has tie-ups with allied units in Haryana, Punjab, Himachal Pradesh, Rajasthan, Bihar, Andhra Pradesh and Pondicherry. “The areas where we don’t have a manufacturing unit at all is in Uttar Pradesh and Tamil Nadu,” says Adil. “By the first quarter of the next financial year, we should have one in Tamil Nadu.”
“Uttar Pradesh, however, would have to wait. We find that market difficult to crack,” he said.
Meanwhile, the company is planning to increase exports to the African continent, where it ships 20 containers per month. “We are looking to take the number to 100 containers per month, and set up our own bottling plant in the future.”
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