Sula Vineyards Ltd
NSE:SULA
Sula Vineyards Ltd
Sula Vineyards Ltd. engages in the production and marketing of winery products to local India and international. The company is headquartered in Nashik, Maharashtra and currently employs 729 full-time employees. The company went IPO on 2022-12-22. The Company’s business is classified under two categories: the production of wine, the import of wines and spirits, and the distribution of wines and spirits (the Wine Business); and the sale of services from ownership and operation of wine tourism venues, including vineyard resorts and tasting rooms (the Wine Tourism Business). The company distributes wines under a bouquet of brands. In addition to the flagship brand Sula, its brands include RASA, Dindori, The Source, Satori, Madera & Dia, with its flagship brand Sula, being the category creator of wine in India. The firm produces two types of wine: Still wine, and Sparkling wine. The firm produces over 56 different labels of wine at four owned and two leased production facilities located in the Indian states of Maharashtra and Karnataka. Its direct to consumer (D2C) selling channel primarily operates through its Wine Tourism Business facilities in Nashik and Bengaluru.
Sula Vineyards Ltd. engages in the production and marketing of winery products to local India and international. The company is headquartered in Nashik, Maharashtra and currently employs 729 full-time employees. The company went IPO on 2022-12-22. The Company’s business is classified under two categories: the production of wine, the import of wines and spirits, and the distribution of wines and spirits (the Wine Business); and the sale of services from ownership and operation of wine tourism venues, including vineyard resorts and tasting rooms (the Wine Tourism Business). The company distributes wines under a bouquet of brands. In addition to the flagship brand Sula, its brands include RASA, Dindori, The Source, Satori, Madera & Dia, with its flagship brand Sula, being the category creator of wine in India. The firm produces two types of wine: Still wine, and Sparkling wine. The firm produces over 56 different labels of wine at four owned and two leased production facilities located in the Indian states of Maharashtra and Karnataka. Its direct to consumer (D2C) selling channel primarily operates through its Wine Tourism Business facilities in Nashik and Bengaluru.
Tough Quarter: Q3 was challenging, with significant revenue and profit decline, mainly due to a large destocking in Karnataka, Sula’s second-biggest market.
Karnataka Destocking: The company undertook major inventory reduction in Karnataka to align with weak demand and improve working capital; no further major destocking expected.
Growth Elsewhere: Excluding Karnataka, revenues were roughly flat versus last year, with Maharashtra, Telangana, and other key markets showing growth.
Wine Tourism Surge: Wine Tourism revenues soared 34% year-on-year in Q3, driven by new resort capacity and a 17% increase in footfall.
The Source Momentum: The Source wine range achieved double-digit growth, now making up 11% of Own Brands revenue—up from 8.5% last year.
Margins Hit: Gross margin dropped 270 basis points, and EBITDA fell 40% year-on-year due to adverse geography mix and Karnataka’s decline.
Optimistic Outlook: Management expects revenue and margin recovery from Q4, with improving demand and ongoing strength in Wine Tourism.
FTA Duty Impact: Management feels well-positioned for EU wine import duty reductions, believing most of their portfolio will remain protected.
