United Spirits Ltd (USL), the spirits arm of the UB Group, is integrating two of its divisions?wines and spirits?to cut down on costs. As part of the process, the manpower of both the divisions will be integrated while the structural and financial structures will remain unchanged.
According to sources, the decision to this effect was taken by the company a couple of days back and will be implemented once a resolution is passed during its annual general meeting.
Abhay Kewadkar, business head, wines and chief winemaker, UB group, refused to talk about the development, when contacted. The Rs 3200-crore USL operates through two wine subsidiaries, United Vintners and Four Seasons Wines. While the United Vintners deals in imported wines, which the company has been doing for the past 20 years, Four Seasons produces and sells Indian wines straddling all price points.
USL had set up its wine division in September 2006 and invested Rs 25 crore in plant, machinery and equipment. The company currently sources grapes from a 1,000-acre plot in Baramati, 120 km from Pune. The company is planning to buy an additional 300 acres of land there and start contract farming on another 700 acres in the next two years.
The spirits and wine arm of the UB group, with exports to over 59 countries, is among the three leading spirits companies in the world. While Whyte and Mackay and Bouvet Ladubay are 100% subsidiaries of USL, the company has 17 brands that sell more than a million cases each every year. It has a market share of 59% for its first line brands in India.
The company posted a net profit of Rs 3210.60 million for the year ended March 31, 2008 as compared to Rs 4940.10 million for the previous year. Total income increased from Rs 27787.40 million for the previous year to Rs 31956.40 million for the year ended March 31, 2008.