Radico Khaitan B&K meet :
With internet culture and middle class emerging, drink is not a taboo. With income level rising, premiumization is happening.
30% of alcohol industry is in White spirits Globally. In India, it is <5%, we are dominant in White spirits and we see good growth potential.
On normalized basis, Our industry should witness volume growth 8-9% and premium side double digits and white spirits will be even faster than this.
Drinking at home : more consumption since we can consume more.
Our industry is largest revenue source for state government. Every state depends on liquor industry. 28 states 28 different countries and if states ban, illegal cross border sales happen.
Covid tax imposed is reversed since it impacts volumes and impacts their revenues indirectly.
Delhi : is becoming more like UP. UP is the best state for liquor and we are leader there. Many states will encourage easy drinking.
We always have given younger taste, and modern packaging.
8PM : name was unique. Indians usually drink at 8. We advertised it uniquely, was awarded best Ad. Did 1 million case 1 year and came in limca book of records. In 8 years, we did 10 millions cases.
Magic moments in 2007, priced it very high and did different packaging where we printed on it.
Morpheus brandy market share of 60%.
We concentrated on free cashflow. FCF was linked to EBITDA and collections and hence let go of unprofitable avenues lost volumes but helped us in free cashflow.
Jaisalmer Gin : priced at 3600 top end of Gin market.
30% to 50% in 4 years : Premium portfolio. Going forward, we will focus on premium. Expect double digit for next 5-7 years.
8PM Premium Black : We did 1.2 million cases despite Covid and this year will do 2 million cases.
We will introduce luxury whisky one of kind in Indian Market.
Capacity : more than 50% we outsource.
Distribution : equivalent to any of the top company.
Only company : launched 12 brands in last 10 years (only company to do this.)
In producing 1 litre of alcohol, we consume lowest water in Industry since we recycle and use. Earlier it was 12 litre now 6 litre : Shows focus on environment.
We rate suppliers on sustainability model and their practices.
We do keep doing planting trees drives.
From time Abhishek joined, it is only business, so much scope and I love this business and no plans for diversification.
Some unbranded business :
Country liquor business in UP. We dont intend to expand restrict it to UP.
Any distillery compulsory has to produce country liquor for state purpose.
We sell everything on cash and requires least resources basically low margin but safe business.
Regular range in those states where contribution is high. For us volumes is easy, we are chasing profitable growth. Regular range states where pricing is good is our focus.
Whisky :
If you look at history of Radico. Radico moved forward only with Premiumisation strategy. Price leadership will always be focus just as other portfolios explained below. 8PM premium black 1.2 million 18 months of launch. This shows our premiusation is working for us.
Vodka we are price leader too and market share leadership too.
Rum : we have market leadership with Contessa and 1965 Victory along with price premium.
Brandy : We have leadership even here with price premium.
Q3FY22 : We will launch whisky which will compare with international brands. Every launch will be premium in pricing.
We dont believe in inorganic growth. Hardly any premium brands for acquisition. We won’t acquire regular brands and dilute EBITDA margins.
Cash will be : Dividends or buyback.
CSD (Canteen Stores department) : For Rampur and Jaisalmer huge opportunity here.
Next 3-4 years premium portfolio from 50% to 60%. Margins will get better.
When GST came, States now only have liquor income under their control. Hence every states wants liquor favorable system.
Online ordering : Boost sales from Woman POV since our liquor shops are not that great.
