New Delhi, Nov 13 (PTI) India Glycols Ltd, which on Wednesday announced a partnership with Bengaluru-based Amrut Distilleries, is mulling a demerger of its spirits business and subsequently listing on the exchanges, company officials said.
The company, which gets about 25 per cent of revenue from IMFL business, is going to invest further in this business -- now driving the growth of India Glycols Ltd (IGL) -- which operates from speciality chemicals to alchoBev segment.
As part of its strategy to enter the premium whisky market -- that is witnessing the fastest growth in the alchoBev segment -- IGL will distribute and sell select Amrut brands in the premium segment across markets in north India.
This brand licensing agreement will help IGL position itself better in the premium segment of the whisky market -- generally priced above Rs 1,000 per 750 ml bottle -- and gain market share, IGL Advising President IMFL Raju Vaziraney said.
"Through this partnership with Amrut, IGL plans to capture a double-digit market share in the relevant premium segment over the next couple of years," Vaziraney told PTI.
With rise in disposable income in the country, the aspiration level has also gone up and people are looking for a better product, especially young consumers, he said.
"As a result, sale of premium whisky is increasing by almost 58 per cent and the regular (mass and enter-level brands) are either flat or facing marginal degrowth," Vaziraney said, adding, "With this alliance, we will play in both segments".
Vaziraney further said the regular segment is facing issues such as price fixation by the respective state governments in trade and escalation of various input costs, which has put several IMFL and entry-level product makers in a challenging situation with declining margins.
IGL expects distribution of Amrut's MaQintosh Whisky, Old Port Rum, Bejoice XO Brandy, and MaQintosh White Label Whisky in north India markets, to help improve its sales tally.
Moreover, IGL is also planning to demerge its spirits business into a separate entity and subsequently list on the bourses, its Finance Head Manish Pant said.
IGL's consolidated revenue for FY24 was Rs 7,947.27 crore, with spirits business contributing about 15 per cent.
In the current fiscal year, the Uttarakhand-based company expects its spirits business to grow 25 per cent, helped by volume growth and premimuisation, which is taking the average sales value up along with improvement in margins.
In the first half of FY25, India Glycols has reported a growth of 17.28 in its total income to Rs 4,433.43 crore.
"The liquor business is actually driving the growth of the entire company," he said.
The company is producing IMFL brands from its Gorakhpur and Kashipur units. Its total liquor bottling capacity is 2.82 crore cases per year. It has invested about Rs 1,100 crore in its liquor business.