Mumbai: Sazerac Company global chief executive Jake Wenz said the American alcoholic beverage firm will acquire the remaining stake in John Distilleries, the maker of Paul John single malt, in the next few years, betting on its second- largest market both by value and volume.
At present, Sazerac, the biggest distiller in the US and the third largest in the world, has a 60% stake in John Distilleries while the founder and chairman Paul John owns the rest of the company.
"Having somebody with Paul's vision and his understanding of the market was helpful for us, versus jumping in and not having all of the background. So, it's been a great relationship. We are learning and trying to prepare ourselves for a day where you know he might move on to other ventures. Probably in the next three to five years, we will be in a place where we will be ready," Wenz told ET in an exclusive interview.
"Globally, the spirits market and beverage alcohol market in general has had a bit of a reset. But for Sazerac, India, a dynamic nation, is growing at a fast pace, and we are doing relatively well within the sector here," he said. The liquor segment in the country is highly regulated, with the government controlling pricing, retail as well as distribution in several states. In addition, the central government allows up to 50% alcohol strength in whisky and single malts, but a few states restrict it to 42%.
"It may be different here, but it's not necessarily more difficult for an alcohol supplier. Every market is regulated, and it should be. It's not milk, it's not chips. So, the rules are bright line rules, and it's incumbent upon a supplier to understand them to be compliant, but once you do, we don't have to deal with any rules that no other supplier has to deal with. So, it's fair," said Wenz. With sales topping 23 million cases, John Distilleries is also the maker of India's fifth largest whisky-Original Choice Whisky, and has annual revenue of about ₹3,000 crore. The Bengaluru-based distiller is trebling its capacity in Goa to three million litres annually.
With sales of about 400 million cases annually, India is one of the largest spirits markets in the world and the largest whisky consuming country, making it a very high priority for Sazerac, said the company. The company said it will retain its strategy of focusing on mass and economy brands which account for more than 90% of its sales even as it brings more global brands from Sazerac's portfolio.
"Our mandate is more volume than revenue. That might surprise people but, ultimately, somebody has to drink a bottle. So, from moving bottles and boxes, we will figure out how to monetise it eventually. We do like to make profit, but I think you can get caught up when you are trying to grow, being too fixated on revenues and profits," said Wenz.
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"Having somebody with Paul's vision and his understanding of the market was helpful for us, versus jumping in and not having all of the background. So, it's been a great relationship. We are learning and trying to prepare ourselves for a day where you know he might move on to other ventures. Probably in the next three to five years, we will be in a place where we will be ready," Wenz told ET in an exclusive interview.
"Globally, the spirits market and beverage alcohol market in general has had a bit of a reset. But for Sazerac, India, a dynamic nation, is growing at a fast pace, and we are doing relatively well within the sector here," he said. The liquor segment in the country is highly regulated, with the government controlling pricing, retail as well as distribution in several states. In addition, the central government allows up to 50% alcohol strength in whisky and single malts, but a few states restrict it to 42%.
"It may be different here, but it's not necessarily more difficult for an alcohol supplier. Every market is regulated, and it should be. It's not milk, it's not chips. So, the rules are bright line rules, and it's incumbent upon a supplier to understand them to be compliant, but once you do, we don't have to deal with any rules that no other supplier has to deal with. So, it's fair," said Wenz. With sales topping 23 million cases, John Distilleries is also the maker of India's fifth largest whisky-Original Choice Whisky, and has annual revenue of about ₹3,000 crore. The Bengaluru-based distiller is trebling its capacity in Goa to three million litres annually.
With sales of about 400 million cases annually, India is one of the largest spirits markets in the world and the largest whisky consuming country, making it a very high priority for Sazerac, said the company. The company said it will retain its strategy of focusing on mass and economy brands which account for more than 90% of its sales even as it brings more global brands from Sazerac's portfolio.
"Our mandate is more volume than revenue. That might surprise people but, ultimately, somebody has to drink a bottle. So, from moving bottles and boxes, we will figure out how to monetise it eventually. We do like to make profit, but I think you can get caught up when you are trying to grow, being too fixated on revenues and profits," said Wenz.
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