“A case study on behalf of Simbhaoli sugars limited”

A dissertation submitted in partial fulfillment of the requirements for the award

Degree
In
MASTER OF BUSINESS ADMINISTRATION
From

SUBMITTED BY
Mr. Nilesh Chamoli
Under the Guidance
Of
Prof. A.V.RAO

National school of Business

www.nsbindia.org , info@nsbindia.org
#33, 1ST CROSS, 22ND MAIN, MARENAHALLI, PHASE 2, J P NAGAR, BANGALORE,
KARNATAKA, INDIA 560078
“Study of Market size of semi premium whisky and to study the
marketing strategy of the leaders in that segment and how to
promote the new brand”

A PROJECT REPORT

Under the guidance Of

___Prof. A.V.RAO___

Submitted by

_____NILESH CHAMOLI_____
in partial fulfillment o f the requirement
for the award of the degree

Of

MBA

IN
Marketing
 SEPTEMBER-DECEMBER & 2009

EXAMINER CERTIFICATION
The project report on

“Study of Market size of semi premium whisky and to study the marketing
strategy of the leaders in that segment and how to promote the new brand”

Of
NILESH CHAMOLI

Is approved and is acceptable in quality and form.

Internal Examiner External Examiner

 DECLARATION

I hereby declare that this project entitled “Study of Market size of semi premium
whisky and to study the marketing strategy of the leaders in that segment and
how to promote the new brand”

Is an original work carried out by me under the direct supervision and guidance of Prof.
A.V.Rao, faculty at National School of Business, Bangalore. This project report has
been submitted to Sikkim Manipal University as a part of partial fulfillment for the award
of the degree of Master of Business Administration.
I also declare that no part of this presentation had ever been published or submitted as
a project representation for any degree of NATIONAL SCHOOL OF BUSINESS.

DATE:
Nilesh Chamoli
MBA 3RD SEMESTER
SMU REG. NO: 520852590
NATIONAL SCHOOL OF BUSINESS, BANGALORE
 ACKNOWLEDGEMENT

Few months of learning and gaining valuable knowledge in Simbhaoli Sugars would not
have been possible without the constant guidance and support of certain key people.
We would like to thank them in true sincerity.

I want to express my heartfelt gratitude to Mr. S.K.Sinha (Sales & distribution manager)
for being guiding force throughout my project. Without his constant support and
encouragement this project would not have been a success.

I am really grateful to him for giving me the opportunity to do my summer internship

project at SIMBHAOLI SUGARS.

I would also like to thank Mr. SAMIRUM AGNIHOTRI (Brand Development manager) for
extending his support whenever the need came up.

I would also like to thank Prof. A.V.RAO for his invaluable support and guidance. He
has been the motivating power for us to do well in our project and to reestablish
confidence in us at all those times wherever I felt low.

Our heartfelt thanks to Mr. AMITABH ANAND (ASSISTANT DIRECTOR- CORPORATE

RELATIONS), NATIONAL SCHOOL OF BUSINESS Bangalore, for the constant
guidance, encouragement and motivation he extended through out the project study.

I take this opportunity to thank all other faculty members of NATIONAL SCHOOL OF
BUSINESS Bangalore and every associate of SIMBHAOLI SUGARS, Delhi without
whose co-operation, I would not have been able to complete this project work
successfully.
Date:
Place: Bangalore
Mr. NILESH CHAMOLI
 PREFACE

Indian Liquor industries share common characteristics arising form a similar policy
framework. Country liquor, Indian made Foreign Liquor (IMFL) and beer are state
subject, with each state controlling the duty structure and distribution. Incidence of
import and export duties results in high cost of interstate movements which has resulted
in each state having attributes of a separate market.

This Market research has been done for Simbhaoli sugar Limited for its distillery unit as
the company is going to launch a new brand of whisky in its semi premium range. For
that I have to study the “Market size of semi premium whisky and to study the
marketing strategy of the leaders in that segment and how to promote the new
brand”. For this purpose the market of Delhi and Gurgaon has been covered for
differentiating the behavior of consumers in this market and the role of retailers in
promoting the new brand. Survey has been conducted through questionnaires and
responses of consumers and retailers have been recorded. The results may not be in
accordance to the actual situation in the market because of small sample size and the
limitation of area, but serious efforts have been put into get the best results.
Table of Contents
INTRODUCTION AND OVERVIEW OF MARKETING………………………………..1-10
MARKET……………………………………………………………………………………3
MARKETING……………………………………………………………………………………..4
B2C & B2B MARKETING……………………………………………………………………….5
DIFFERENCE BETWEEN B2C & B2B MARKETING……………………………………….8
INDUSTRIAL REVOLUTION…………………………………………………………………..9
INDUSTRIALIZATION IN INDIA………………………………………………………………10
RESEARCH OBJECTIVE………………………………………………………………11-15
OBJECTIVE……………………………………………………………………………..11
STATEMENT OF THE PROBLEM…………………………………………………………….11
RESEARCH METHODOLOGY……………………………………………………….12
SOURCES OF DATA…………………………………………………………………..13
LIMITATION……………………………………………………………………………..15

INTRODUCTION ABOUT LIQUOR INDUSTRY………………………………………………16-41

LIQUOR INDUSTRY IN INDIA…………………………………………………………16
HISTORY OF WHISKY…………………………………………………………………18
INDUSTRY STRUCTURE………………………………………………………………21
RESTRICTIONS…………………………………………………………………………32
IMFL SALES IN DIFFERENT STATES……………………………………………….34
RECENT TRENDS………………………………………………………………………36
COMMON TERMS………………………………………………………………………38
DIFFERENT ALCOHOLIC DRINK…………………………………………………….41

INTRODUCTION ABOUT COMPANY…………………………………………………42-58

ORIGIN…………………………………………………………………………………..42
VISION…………………………………………………………………………………...43
OPERATING SEGMENTS…………………………………………………………….43
PRESENT ACTIVITIES………………………………………………………………..48
TECHNOLOGY INITIATIVE…………………………………………………………...51
BRAND BUILDING……………………………………………………………………..52
MANAGEMENT TEAM………………………………………………………………...54

COMPETITORS…………………………………………………………………………..59-70
RADICO KHAITAN……………………………………………………………………..59
UB GROUP……………………………………………………………………………...62
MOHAN MEAKINS……………………………………………………………………..64
SHAW WALLACE……………………………………………………………………....65
SEAGRAMS……………………………………………………………………………..66
AMRUT DISTILLERIES………………………………………………………………..68
DIAGEO………………………………………………………………………………….70
METHODS FOR PROMOTING A NEW BRAND……………………………………..71-92
SALES PROMOTION…………………………………………………………………...71
PUBLIC RELATION……………………………………………………………………..72
DISTRIBUTION CHANNEL…………………………………………………………….73
PROMOTIONAL STRATEGY………………………………………………………….76
MARKETING MIX FOR SUCCESFUL PRODUCT LAUNCHING………………….77
TOOLS OF ADVERTISING LIQUOR………………………………………………….78
FACTOR AFFECTING COMPANY MARKETING STRATEGY…………………….79
RELATIONSHIP BETWEEN PRODUCT LIFE CYCLE & MARKETING
STRATEGY……………………………………………………………………….. …….80
LIMITATION……………………………………………………………………………....83
RECOMMENDATION FOR THE COMPANY………………………………………...84
QUESTIONNAIRE FOR CONSUMER………………………………………………...86
OUTCOMES……………………………………………………………………………...88
QUESTIONNAIRE FOR RETAILER…………………………………………………...90
OUTCOMES………………………………………………………………………………92
 PROJECT TITLE

I have undertaken a project titled “Study of Market size of semi premium whisky and
to study the marketing strategy of the leaders in that segment and how to
promote the new brand”

OBJECTIVES
The study has been done by undertaking following objective:-

 To find out the leader in semi premium range of whisky

 To understand the actual market size of the industry specially in the particular
segment and the growth factor
 To make a strategy for developing a new liquor brand
 To provide suggestion to overcome the adversity

Now as the objective of the study is clear now, let us talk about the finding and
conclusion of the project. But first go through the whole study and understand different
product in liquor and the industry type.
 EXECUTIVE SUMMARY

Perhaps the most distinctive skill of professional marketers is their ability to create,

maintain, protect, and enhance brands. Branding is the art and cornerstone of

marketing. The American Marketing Association defines a brand as: a name, term,

sign, symbol, or design, or a combination of them, intended to identify the goods or

services of one seller or group of sellers and to differentiate them from those of

competitors. Thus a brand denitrifies the seller or maker.

“What distinguished a brand from its unbranded commodity counterparts is the

consumer’s perceptions and feelings about the product’s commodity counterparts is

the consumer’s perceptions and feelings about the product’s attributed and how

they perform. Ultimately, a brand resides in the minds of consumers. A brand can

be better positioned by a associating its name with desirable benefits.

A brand is much more than a name, logo, colors, a tagline, or symbol. These are

marketing tools tactics. A brand is essentially a marketer’s promise to deliver a

specific set of feature, benefits and services consistently to the buyers. The

marketer must establish a mission for the brand and a vision of what the brand must

be and do.

Brand nodding occurs when customers experience the company as delivering on its

benefit promise. The fact is that brands are not built by advertising but by the brand

experience. Brands vary in the amount of power and value they have in the

marketplace. At one extreme are brands that are not known buy must buyers then

there are brands for which buyers have a fairly high degree of brand awareness.

Beyond this are brands with a high degree of brand acceptability.

We define brand equity as the positive differential effect that knowing the brand

name has on customer response to the product or service. Brand equity results in

customers showing a preference for one product over another when they are

basically identical. The extent to which customers are willing to pay more for the

particular brand is measure of brand equity.

A brand needs to be carefully managed a so that its equity does not depreciate.

This requires maintaining or improving brand awareness, perceived quality and

functionality, and positive associations. These tasks require continuous R and D

investment, skillful advertising, and excellent trade and consumer service.

“Study of Market size of semi premium whisky and to study the marketing
strategy of the leaders in that segment and how to promote the new brand”

INTRODUCTION

This modern era of liberalization and globalization has opened a broad scope for
conducting marketing of products in business. To -day; marketing management has
become more challenging and exciting than ever before. Generally a group customer
who heavily shares a common a group of customers who heavily share a common need
constitute the market. Now days, market has turned from seller’s market to buyer’s
market.

Every market plan depends upon the nature and size of the market. The
word marketing means the act of selling and buying in the market. Marketing involves
meeting traders, merchants, dealer’s retailers and many a time the consumers directly
through media. But it all depends upon the factors, conditions, characteristic of the
producer’s product, middlemen and the consumers. Hence, the marketing manager and
sales executives are also required to be more and more consumer oriented. Today,
profit rather than sales volume is given priority. To achieve goal the proper marketing
strategy is needed. A successful strategy man oeuvre for obtaining specific goals can
be possible ply by building a high committed and motivated sales team of area
managers, sales officers, dealers and officers.

Strategy of marketing depends upon the nature of products, quantity

of production, consumers, views and awareness overall demand, capacity of product
circulation and existence of middleman.

A new product may have to be promoted by door to door selling, selling shops and
through media like T.V. or through advertisements. If a product is to be exported, the
marketing has to be done within the framework of policies and procedures set up by the
govt. The middlemen under strict price and control policy of the Ministry of Home Affairs
especially Food and Civil Supply Department.

For successful marketing of its products, a company may have sales

persons, area sales manager, regional sales manager, zonal sales manager marketing
professionals, depot communication manager, product manager media assistant, public
relation officer and managing director depending upon the size of the company. For the
successful career in marketing a person must have certain basic skills like a degree in
an area of thrust related to the type of company, ability to formulate and implement
sales, distributional sales, distributional and promotional strategies and exceptional
skills to motivate and effectively manage the sales force. In addition, the attitude and
talent for innovation, good knowledge of designing and preparing various inputs
including visual aid folder is needed. Besides this, involvement in marketing research for
launching new products and in training sales force is must for a successful marketing
manager. The above qualifications are must because the role of marketing manager in
the organization has also changed with requirement of the hour.

Today, marketing manager has become the integral part of business and
involves all the activities that take place in an enterprise. As a good marketing manager
one has to train the staff. Therefore the sound knowledge of marketing activities,
marketing strategies and legal aspects is needed. Not only this, there many other things
which pave the way for promoting sales. Good contacts in corporate sectors, knowledge
of controlling activities up to grass-root level, interacting with concerned departments
and sales regulatory authorities are also required for a successful marketing manager.
Four Ps namely product, price, place and promotion are the most vital areas of
marketing management. Fifth P added is pace. Without these the marketing objectives
of organization cannot be fulfilled.
Channel distribution system may get affected by the product
factor, market factor and institutional or organizational factors and the vital decisions
has to be taken with regard to internal sales promotion in the light of channels of
distribution.

The marketing division should see that brand identification is must for the producers to
exercise maximum control over the demand for its products. Branding of products is
necessary for administration of warranty, guarantee and service policies. The branding
is also necessary from companies share point of view and for export purpose.

Overall marketing manager must use management science and decisions

making technology to the fullest while understanding the limitations of these tools. He
should also provide guidelines, stimulations and encouragement for the fullest and rich
use of inspiration talents, inventiveness and judgment.
Market
A market is any one of a variety of different systems, institutions, procedures, social
relations and infrastructures whereby persons trade, and goods and services are
exchanged, forming part of the economy. It is an arrangement that allows buyers and
sellers to exchange things. Markets vary in size, range, geographic scale, location,
types and variety of human communities, as well as the types of goods and services
traded. Some examples include local farmers’ markets held in town squares or parking
lots, shopping centers and shopping malls, international currency and commodity
markets, legally created markets such as for pollution permits, and illegal markets such
as the market for illicit drugs.
If we go in the deep we found that the world MARKET comes form a Latin world
“MERCARUS” which means TRADE.

Marketing

Marketing is everywhere. Formally or informally, people and organizations engage in a

vast number of activities that we could call marketing. Good marketing has become an
increasing vital ingredient for business success. And marketing profoundly affect our
day – to – day lives. It is embedded in everything we do – from the clothes we wear, to
the web sites we clicks on, to ads we see.
Many people think that marketing means “selling or advertising”. It’s true that these are
the part of the marketing. But marketing is much more then the selling and
advertising. Marketing is about indentifying and meeting human and social needs. One
of the shortest definitions of the “marketing is meeting needs profitably”.
The American Marketing Association offers the following formal definition – Marketing
is an organizational function and set of process for creating, communicating and
delivering value to customer and for managing customer relationship in a way the
benefits the organization and its stake holders.
The Chartered Institute of Marketing defines marketing as "the management process
responsible for identifying, anticipating and satisfying customer requirements profitably”.
We can define marketing as – It is the performance of activities that seeks to
accomplish an organization’s objective by anticipating customer or client needs and
directing a flow of need – satisfying goods and services from the producer to the
customer or clients.
OR
Marketing is the process associated with promoting for sale goods or services. It is
considered a "social and managerial process by which individuals and groups obtain
what they need and want through creating and exchanging products and values with
others. It is an integrated process through which companies create value for customers
and build strong customer relationships in order to capture value from customers in
return.

Business Marketing is the practice of individuals, or organizations, including

commercial businesses, governments and institutions, facilitating the sale of their
products or services to other companies or organizations that in turn resell them, use
them as components in products or services they offer, or use them to support their
operations. Also known as industrial marketing, business marketing is also called
business-to-business marketing, or B2B marketing, for short. (Note that while marketing
to government entities shares some of the same dynamics of organizational marketing,
B2G Marketing is meaningfully different.)
B2C and B2B Marketing
Many might say that marketing means marketing no matter to whom or through which
medium company want to market its product and services and to some extant they are
true but not always. We can differentiate here marketing on the basis of to whom the
company market its product whether it’s to final consumer or to some other company
which will then modify the product and the market to the final consumer. So, here we
have two type of marketing – Business – to – consumer market and Business – to –
business market

Business – to – consumer market (B2C Market)

When any firm direct market its products and services to the final consumers then it is
called Business - to – Consumer marketing.
So we can say that Business-to-consumer (B2C) describes activities of businesses
serving end consumers with products and/or services

Examples of the B2C market

1. A family is at home on a Sunday night and is watching television. An
advertisement appears that advertises home delivered pizza. The family decides
to order a pizza.

2. Walking down a supermarket aisle, a single man aged in his early 30's sees a
hair care product that claims to reduce dandruff. He pick's the product and adds it
to his shopping cart.
 3. A pensioner visits her local shopping mall. She purchases a number of items
including her favorite brand of tea. She has bought the same brand of tea for the
last 18 years.

The main features of the B2C Market–

1. Marketing is one-to-many in nature. It is not practical for sellers to individually

identify the prospective customers or meet them face-to-face.

2. Lower value of purchase

3. Decision making is quite often impulsive (spur of the moment) in nature

4. Greater reliance on distribution (getting into retail outlets)

5. More effort put into mass marketing (One to many)

6. More reliance on branding.

7. Higher use of main media (television, radio, print media) advertising to build the
brand and to achieve top of mind awareness

Business – to- Business Market (Industrial Market)

Here one organization produce the goods for some other organization which then will
use those product and services and then will provide final product or service to the
consumer. So we can say that Business-to-business (B2B) describes commerce
transactions between businesses, such as between a manufacturer and a wholesaler,
or between a wholesaler and a retailer.
Typical examples of a B2B Market
1. An organization is seeking to build a new warehouse building. After carefully
documenting their requirements, it obtains three proposals from suitable
construction firms and after a long process of evaluation and negotiation it places
an order with the organization that it believes has offered the best value for
money.

2. An organization has significant need for legal services and obtains submissions
from two law firms. Analysis of the proposals and subsequent discussions
determines that there is no price advantage to placing all of the work with one
firm and the decision is made to split the work between the two firms based on
an evaluation of each firm's capabilities.

3. A sales representative makes an appointment with a small organization that

employs 22 people. He demonstrates a photocopier/fax/printer to the office
administrator. After discussing the proposal with the business owner it is decided
to sign a contract to obtain the machine on a fully maintained rental and
consumables basis with an upgrade after 2 years.

The main features of the B2B Market

1. Marketing is one-to-one in nature. It is relatively easy for the seller to identify
prospective customers and to build a face-to-face relationship.

2. Highly professional and Trained people in Buying processes are involved. In

many cases two or three decision makers have to be considered in purchasing
industrial products.

3. High value considered purchase.

• Purchase decision is typically made by a group of people ("buying team") not one
person.
4. Often the buying/selling process is complex and includes many stages (for
example; request for expression of interest, request for tender, selection process,
awarding of tender, contract negotiations, and signing of final contract)
 5. Selling activities involve long processes of prospecting, qualifying, wooing,
making representations, preparing tenders, developing strategies and contract
negotiations.

Main difference between B2C (consumer) market and B2B (Business) market

CONSUMER MARKET BUSINESS MARKET

Every customer has equal value and There are a small number of big customers
represents a small % of revenue that account for a large % of revenue

Sales are made remotely, the Sales are made personally, the
manufacturer doesn't meet the customer manufacturer gets to know the customer

Products are the same for all customers. Products are customized for different
The service element is low customers. Service is highly valued

Purchases are made for personal use - Purchases are made for others to use -
image is important for its own sake image is important where it adds value to
customers

The purchaser is normally the user The purchaser is normally an integrator;

someone down the supply chain is the
 user.

Costs are restricted to purchase costs Purchase costs may be a small part of the
total costs of use

The purchase event is not subject to The purchase event is conducted

tender and negotiation professionally and includes tender and
negotiation.

The exchange is one of transaction. There The exchange is often one of strategic
is no long-time view (financial services intent. There is the potential for long term
differ) value

Industrial Revolution

The Industrial Revolution was a period from the 18th to the 19th century where major
changes in agriculture, manufacturing, mining, and transport had a profound effect on
the socioeconomic and cultural conditions starting in the United Kingdom, then
subsequently spreading throughout Europe, North America, and eventually the world.
The onset of the Industrial Revolution marked a major turning point in human history;
almost every aspect of daily life was eventually influenced in some way.
Starting in the later part of the 18th century there began a transition in parts of Great
Britain's previously manual labor and draft-animal–based economy towards machine-
based manufacturing. It started with the mechanization of the textile industries, the
development of iron-making techniques and the increased use of refined coal. Trade
expansion was enabled by the introduction of canals, improved roads and railways. The
introduction of steam power fuelled primarily by coal, wider utilization of water wheels
and powered machinery (mainly in textile manufacturing) underpinned the dramatic
increases in production capacity. The development of all-metal machine tools in the first
two decades of the 19th century facilitated the manufacture of more production
machines for manufacturing in other industries. The effects spread throughout Western
Europe and North America during the 19th century, eventually affecting most of the
world, a process that continues as industrialization. The impact of this change on
society was enormous.

INDUSTRIALIZATION IN INDIA
India opens the gate for industrialization and globalization in 1991. Since then Indian
economy has increased many folded. The economy of India is as diverse as it is large,
with a number of major sectors including manufacturing industries, agriculture, textiles
and handicrafts, and services. Agriculture is a major component of the Indian economy,
as over 66% of the Indian population earns its livelihood from this area.
However, the service sector is greatly expanding and has started to assume an
increasingly important role. The fact that the Indian speaking population in India is
growing by the day means that India has become a hub of outsourcing activities for
some of the major economies of the world including the United Kingdom and the United
States. Outsourcing to India has been primarily in the areas of technical support and
customer services.
In Purchasing Power Parity GDP, the figure for India was 1.5 trillion US Dollars in 2008.
The per capita income of India is 4,542 US Dollars in the context of Purchasing Power
Parity. This is primarily due to the 1.1 billion population of India, the second largest in
the world after China. In nominal terms, the figure comes down to 1,089 US Dollars,
based on 2007 figures. According to the World Bank, India is classed as a low-income
economy.
Other areas where India is expected to make progress include manufacturing,
construction of ships, pharmaceuticals, aviation, biotechnology, tourism,
nanotechnology, retailing and telecommunications. Growth rates in these sectors are
expected to increase dramatically.
Today India’s GDP ( PPP) is $2600 with the export of $126 Billion and Import of $
187.9 Billion. If we take the main manufacturing industry it include:-
Textiles, chemicals, food processing, steel, transportation equipment, cement,
mining, petroleum, machinery, software and services.

RESEARCH OBJECTIVE

The study has been done by undertaking following objective:-

 To find out the leader in semi premium range of whisky

 To understand the actual market size of the industry specially in the particular
segment and the growth factor
 To make a strategy for developing a new liquor brand
 To provide suggestion to overcome the adversity

Now as the objective of the study is clear now, let us talk about the finding and
conclusion of the project. But first go through the whole study and understand different
product in liquor and the industry type.
RESEARCH METHDOLOGY

Research – Research is common parlance refers to a search for knowledge. The

Advanced Learner’s Dictionary of Current English lays down the meaning of research
as “A careful investigation or inquiry specially through search for new facts in any
branch of knowledge” According to Redman & Mory “A systematized effort to gain
new knowledge.” Research Methodology- It is the way to systematically solve the
research problem. It may be understood as a science of studying how research is done
scientifically. In it we study the various steps that are generally adopted by a researcher
in studying his research problem along with the logic behind them.

Types of research Design:-

1. Descriptive Research Design – Descriptive research studies are those studies

which are concerned with describing the characteristics of a particular individual, or of a
group.
2. Hypothesis Research Design – Hypothesis testing research studies (generally
known as experimental studies) are those where researcher tests the hypotheses of
causal relationship between variables.

3. Exploratory Research Design - Exploratory research studies are also termed as

formulative Research studies. The main purpose of such studies is that of formulating a
problem for more precise investigation or of developing the working hypothesis from
and operational point of view. The major emphasis in such studies is on the discovery of
idea and insights. As such the research design appropriate for such studies must be
flexible enough to provide opportunity for considering different aspects of problem under
studies.

Sampling- Sampling may be defined as the selection of some part of an aggregate or

totality on the basis of which a judgment about the aggregate is made. In other words,
process of obtaining information about an entire population by examining only a
part of it. In most of the research.

Types of sampling:-

1. Systematic Sampling- The most practical way of sampling is to select every ith item
on a list. This kind of sampling is known as systematic sampling.

2. Stratified Sampling- If a population from which a sample is to be drawn does not

constitute a homogeneous group, stratified sampling technique is applied in order to
obtain representative sample.

3. Cluster Sampling- If the total area of interest happens to be big one, a convenient
way in which is sample can be taken is to be divided into smaller non-overlapping areas
called cluster known as cluster sampling.

4. Non probability sampling- In case of non probability sampling it is considered

appropriate to use a random selection process where the probability of each cluster
being included in the sample is proportional to size of the cluster.

VARIOUS PARAMETER USED IN RESEARCH

 Research Design – Descriptive
 Data Source - Primary & Secondary data
 Research Instrument – Questionnaire
 Types of Questionnaire - Structure and non-disguised
 Sample Plan – Delhi, NCR
 Sample Size – 100
 Sampling Procedure - Non Probability sampling(Judgment sampling)
  Sampling method - Personal survey method through Preparation of
questionnaire

SOURCES OF DATA

PRIMARY DATA
The primary data consists of original information for the specific purpose at hand. It is
first hand information for the direct users of respondents. The tool used to collect the
data may vary and was collected through various methods like questionnaire, personal
interview etc.
The sources from where and from whom I have collected my primary data are:-
• Direct interview of retailers and distributors
• Direct interview of consumer of alcohol
• Through questionnaire
• Through observation

SECONDARY DATA
Secondary data is the data which has already been collected and assembled. This data
was available with the companies or firms and it was collected from news papers,
periodicals, magazines, websites etc
There are various sources from where I have collected the secondary data are:-
 • Website
• Liquor journals like AMBROSIA
• Newspaper
• Articles
• From company data warehouse

LIMITATIONS

During the process of a research a person comes across certain restrictions certain
limitations. Some of these limitations are overcome while come have to be overlooked
for the smooth conducting of the research. Some of these restrictions are:

 Liquor is such a product that the wholesaler, retailers and consumer fear to come
out with information.

 Due to the wide area of the markets, it was impossible to cover each and every
retail shop, hence only few shops were covered.

 The project has to be completed in 8-10 weeks, which is not enough time to
cover the market. So time was the major constraints in conducting the study.

 In this study it is not possible to collect the opinion of all customers owing to
personal constraints. So the assumptions are drawn on the basis of the
information given by the respondents.

 The study needs to complete within a specified time and in restricted areas. So
the findings cannot be generalized as a whole
INTRODUCTION TO LIQUOR INDUSTRY

THE LIQUOR INDUSTRY IN INDIA

In India, ‘drinking’ has remained a bad word, clubbed with the other vices. While the
beer and liquor market continues to grow at an impressive rate even against an
economic recession, the social stigma remains in place, which manifests itself in anti-
growth state policies.

Domestic Industry

However, the Rs. 60.0 Billion organized beer and liquor industry has been growing at an
impressive rate. In sharp contrast to the trend the world over, beer is losing ground to
hard liquor in India. Amidst beers, the current trend is that lager beer is giving way to
strong beer. Even as the liquor manufacturers could hope to garner the people who are
shifting from beer to liquor, there is a vast country liquor market and a sizable grey
market to contend with.

United Breweries (UB), Shaw Wallace and McDowell (part of the UB Group) presently
dominate the liquor and beer market. The market on its part is set to undergo a sea
change with the arrival of MNCs. The removal of quantitative restrictions (QRs) on the
import of bottled alcoholic beverages only makes the competition tougher.

The MNCs looked forward to good business after the removal of QRs but the
Government nullified it by slapping new taxes. The foreign bottle, therefore, remains as
costly as ever.

LatestTrends

To survive in the highly competitive environment, the MNCs as well as the domestic
majors are coming up with various strategies. Acquisitions and alliances appear to be
the order of the day. Several such deals are already underway while more are in the
offing. The domestic majors are also reorganizing their operations so that they can forge
a deal with an MNC if the need arises. For instance, UB, which recently took up a major
revamp, has said it is willing to offer a 25.0 percent stake to multinational liquor major.

Another trend that seem to be catching up is the consumption of “Coolers” by the

discerning connoisseurs. “Coolers” is typically a cold drink (or cocktail), which is often a
mixture of white wine and fruit juice. As of now there is no definitive data available on
the consumption front for “coolers” either globally or locally. But the fact that this finds
mention in most of the wine and recipe related sites helps us to arrive at the conclusion
that the trend of consuming “coolers” in its various combinations is indeed catching up.

ProblemAreas

What plagues the industry most is a very complicated set of laws and taxes. Each state
has a different excise duty structure, import and export levies and other regulations
regarding licensing fees and sales of new brands. This puts tremendous pressure on
the industry players. They cannot transport their products from a market that has excess
capacity to one where there is a short supply. The taxes on alcoholic beverages are
some of the highest in the world. In some states it works out to as high as 200%. The
brewers argue that subjecting beer to the same level of taxing, as hard liquor is uncalled
for, since the alcohol content in beer is very low. They are lobbying to have beer
delinked from Imfl so that the taxes will fall, prices will plunge and consumption rise.

CrystalGazing

Amidst all the competition and tough laws, the industry sees vast potential in the
market. Consumption is set to rise with higher disposable incomes and standard of
living. While the beer market is expected to expand rapidly, hard liquor is not seen
losing much market share, either.

The alcohol industry is very important for the government. It generates an estimated Rs.
16,000 crore per annum in spite of the fact that the per capita consumption of liquor in
India is the lowest in the world. The total liquor industry is worth Rs. 2,000 crore. IMFL
accounts for only a third of the total liquor consumption in India. Most IMFLs are cheap
and are priced below Rs. 200 per bottle. Alcohol sales proceeds account for 45% of the
total revenue collection in the country. Whiskey accounts for 60% of the liquor sales
while rum; brandy any vodka account for 17% 18% and 6% respectively. MNC’s share
is only 10% and they have been successful only in the premium and super premium
ranges. Post WTO the government may have opened India to foreign distilleries, but the
duty has been increased from 222% to 464-706%. This is due to the fact that there is a
100% customs duty, 150% contravening duty, local taxes, distributor’s margin, retailers
margin and publicity charges.

The cost is finally borne by the consumer. The government claims that this is
being done to protect the domestic liquor industry, the domestic industry accounts for
99% of the market share. This protectionist policy could prove to be counterproductive
and lead to smuggling. As of now, only 45% of the sales are through legal channels and
only 25% of this is duty paid for. Within India itself, the policy of alcohol retail differs
form state to state. While some states like Maharashtra. Uttar Pradesh, and Tamil-Nadu
have a liberal policy, come states like Haryana and Andhra Pradesh have had very
bitter experience in trying to make these states dry and have eventually had to withdraw
the policy.

Whisky History - The beginning of Whisky

What a lot of people do not know is probably that alcohol was first invented in the 10th
Century by Arab alchemists. This technique was found when trying to make cosmetics
and perfume as Arabs do not really have the need to drink alcohol. But soon the
techniques where taken to Spain and then spread throughout Europe. Two Century
later farmers, monks and university scholars where making alcohol from grape and
grain or really any produced that were available to them with ease. Over in Ireland at
this time monks really became the first to distil what we know as whisky when they used
fermented barley. The timing of this was very vague and is believed to be around the
middle of the 11th Century.

Over this time with the travellers going between Ireland and Scotland this process
spread quickly and whisky was starting to be produced by all the local farmers. This is
when I would say whisky finally came to Scotland.

Other facts regarding the history of whisky.

People will always argue about where whisky was invented. Scotland or Ireland? Well
distilling was brought to Ireland by St. Patrick in 432AD, but the first written recording of
it being sold was in Scotland 1494 and it soon became widespread as knowledge
spread on how to distil whisky and soon afterwards nearly every farmer in Scotland
became a maker of whisky. As you can see there is a lot of time between the two dates.
The Celts could be the first to produced whisky as they named their liquid usquebaugh
which means ‘water of life’ and the word whisky also comes from the gaelic word
'Uisga'.

In the early years of whisky there was no period of ageing and after the whisky was
distilled it was consumed. So the whisky had a raw taste. It was then discovered by
accident when a cask was forgotten about in the mid 18th century and when the owner
of the cask tasted the whisky he found that the whisky mellowed after ageing thus the
process of ageing began and why we have whisky maturing now for years just to have
the correct taste that we all love.

At the start of the 17th Century whisky distilling in the Scottish Highlands was massive
with nearly every farmer joining in with the making of whisky. This was because the crop
was easy to produce (barley and oats). This was when whisky became massive in
Scotland, but really was only sold to local people in each of the farming communities.
But then came the Act of Union.

In 1707 and the Act of Union, Scotland and England join parliaments and soon after
taxes were introduced on distilleries and malts. Of course this did not go down well and
a lot of illegal whisky was beginning to be produced. But more penalties were brought in
to reduce this illegal trade and smuggling of whisky. The penalties where very steep and
in a very short space of time this practice nearly disappeared.

It was not until the late 1700’s when whisky became very profitable because of the
improving farming methods. So with all the distilleries at this time present in the
Highlands of Scotland and the main population in Scotland being in the Glasgow and
Edinburgh area, distilleries began to be built within this area. This would help get the
whisky to the marker quicker as the transport network was very poor in these days. But
with taxes very high still and so many costs involved it was hard to keep this as a
profitable business.

So illegal distilling was still happening and with the government really cracking down on
this production the ‘smugglers’ tended to move all there distilling production to small
islands around Scotland where they were very unlikely to be discovered. It was not until
excise act of 1823 when taxes fell with the reducing of duty was reduced by 50%. This
cut down massively the operations by smugglers and the whisky industry became legal
once again.

Generally whisky was really only sold within Britain, but as time when on it spread
around the world and is sold in most countries. Also with it being sold worldwide other
countries producing there own whisky. Hence why this website is about all the whiskies
in the world and not just relating to whisky in Scotland and Ireland.

With the history of whisky very vague it really has been adopted by Scotland and is one
of Scotland biggest export with it being comsumed in nearly every country in the world.
Over the coming years the whisky industry will keep growing and the making of this site
all help the process.
With regards to Irish whisky they have some amazing brands and deserve so much
credit. There exports are always growing, and the merging of certain distilleries this will
keep growing also. There is such a large market place for whisky that there is enough
room for everyone to take a slice of the action. My own thoughts are Scotland and
Ireland are both massive within the whisky industry and both have to keep growing

Indian whisky and Scotch whisky

The drinking of Scotch whisky was introduced into India during the nineteenth century,
during the period of the British Raj. Scotch style whisky is the most popular sort of
distilled alcoholic beverage in India, though India has traditionally been thought to lack a
domestic drinking culture. Whisky, however, has become fashionable for wealthier
Indians, and as such the market for whisky among affluent Indians is one of the largest
in the world.

90% of the "whisky" consumed in India is molasses based, although India has begun to
distil whisky from malt and other grains. Brand names of Indian molasses whisky,
including "Bagpiper", "McDowell's No. 1", and the partially malt based "MaQintosh"
suggest that the inspiration behind the Indian whiskies is Scotch whisky, despite these
products being chiefly made from molasses.

Indian Whisky Brands

• Mcdowell's No.1
• Signature
• Bagpiper
• Seagrams Blender's Pride
• Royal Stag
• Imperial Blue
• Royal Challenge
• Director's special
• Colonel's Special
• Officer's Choice
• Solan No. 1
• Black Knight
• Red Knight
• Aristocrat
• Binnie's Fine Whisky
• Green Label
• Senate
• Diplomat
• Delight Fine Whisky
• Malabar Malt Whisky
 • Cosmopolitan

THE INDUSTRY STRUCTURE

With a size of over 159million cases in fiscal year 2009(each case has 12 bottles, each
containing 750 ml of liquor), the IMFL industry can be broadly classified into products
based on Extra Neutral Alcohol (ENA) and Rectified Spirit (RS). ENA-based products,
which are of better quality and have a longer shelf life, are the focus of main players like
the UB Group and Shaw Wallace. The low-priced RS segment is quite price-sensitive
and characterized by the presence of a number of small players.

The IMFL market is categorized primarily into whisky, brandy, rum, vodka and gin, with
market share heavily skewed towards whisky.

DIFFERENT LIQUOR PERCENTAGE%

WHISKY 58
BRANDY 17
RUM 20
WHITE SPIRIT 5
The industry has been witnessing an annual growth rate of around 10-12% over the
past five years. Last year (2009), the market grew at the rate of 10-12%.
Key drivers for growth of liquor consumption in India
Economic expansion and increasing urbanization is driving the emergence of a larger
middle class that increasingly appreciates premium goods and services, including high
end spirits, and is willing to pay for it.

INCOME GROWTH

 India is one of the fastest growing economies in the world with GDP growth of
9% & 6.8% over the last two years.
 Per capita income has increased from US$ 450 in FY01 to an estimated US$ 781
in FY09
 Growth in per capita income to drive discretionary income growth at much higher
pace than the GDP growth, boosting demand for lifestyle products including
clcholic beverages
 Rural economy is likely to see big upsurge in income levels due to various
government initiatives

INCOME DISTRIBUTION MILLION HOUSEHOLD

YOUNG DEMOGRAPHICS

 More than 60% of India’s population is in the age group of 15-64

 Nearly 485 million people in the drinking age
 Another 150 million are likely to be added to this target population in the next 5
years
 Following these favorable demographics, demand for alcoholic beverages is set
to rise
UNDERPENETRATED MARKET SPELLING HUGE GROWTH
POTENTIAL

 India’s per capita consumption of alcoholic beverages is among the lowest in the
world
 A small increase in per capita consumption to significantly alter industry growth,
given the large population base
REGION WISE CAGR ALCOHOL SALES GROWTH FOR LAST 10 YEARS

India is the fastest growing liquor consuming market in the world and offers
tremendous growth potential in future
GROWTH IN IMFL CATEGORIES
The whisky market is further classified into categories like medium (cheap), regular,
prestige, premium, super deluxe whiskies, and Scotch whisky. The regular segment is
the largest, constituting nearly half the volume of the total whisky market.

The Indian liquor industry can be analyzed by segmenting into 3

parts:

1. Country Spirit

2. Indian Made foreign liquor

3. Foreign Liquor

1. COUNTRY SPIRIT:
This is the unorganized sector occupying about 70% of the liquor market. Country spirits
are distilled spirits mixed or unmixed with spices or other ingredients in small quantities
to import taste and aroma. This spirit is most common among the lower class; it is
manufactured by local methods and has local names the most common being Tharra.

2. INDIAN MADE FOREIGN LIQUOR:

This liquor is not the contemporary Indian liquor. In these category products like whisky,
rum, brandy and vodka are there. British’s had brought in this liquor to India later they
set up distilleries and brewery to manufacturer it in India. In post independence period
there were 28 distilleries and 5-6 breweries. Today there are 233 distilleries and 75
breweries in India. This shows the tremendous growth and acceptance of IMFL brands
in India.

3. FOREIGN LIQUOR:
This is the imported liquor includes Beer and IMFL brands but the most common is
scotch. Imported scotch is in great demand in India but the Indian. Govt. bans the
import of bottled scotch whisky, though a limited quantity can be brought in for duty free
shops, five star’s hotels and in bulk for local bottling by joint ventures.
SUBCATEGORIES GROWTH RATE KEY BRAND
WITHIN WHISKY
MEDIUM 46 HAYWARDS WHISKY
REGULAR -3 DIRECTOR’S
SPECIAL,GILBEYS
GREEN/WHITE,BAGPIPER
PRESTIGE 11 McDOWELL No.1,ROYAL
STAG WHISKY,BAGPIPER
GOLD WHISKY
PREMIUM 18 PETER SCOT, ROYAL
CHALLENGE
DELUX 65 ANTIQUITY,SINGLE MALT
SCOTCH -15 BLACK DOG, 100 PIPERS,
LONG JOHN, JOHNIEE
WALKER

The Scotch segment consists of two categories - Bottled in India (BI) and Bottled in
place of Origin (BO). Bottled imports of Scotch are still not permitted, but bulk imports
are allowed, at import duties of approximately 240%. The official figure of the number of
BO Scotch sold is 85,000 cases per annum. While estimates for the BO Scotch sold
through legal channels stood at 110,000, smuggled imports have been estimated at
between 300,000 and 500,000 cases per annum. Having signed the WTO agreement,
India will have to allow bottled imports of Scotch and reduce duties to around 150%, in a
couple of years.
The liquor industry in India is constrained by a multitude of factors:

Capacity Restrictions

The industry is not allowed to expand without the prior approval of the Central
government, as it among the few industries still under the licensing policy. In a
liberalized scenario, when molasses have been decontrolled and for the brewery sector
too, there is no shortage of domestically available hops, restrictions on new capacities
make little sense. State governments have a part to play as well, since companies have
to get their approval too before commissioning a unit. However, the situation has
changed with the Supreme Court ruling designating alcohol as a State subject. It is
expected that companies will no longer face problems on fresh capacity creation.

High Duty Structure

The manufacture of IMFL is subject to government licensing, while levies on sales are a
State subject. The States earn a significant portion of the revenues from liquor. In some
States, the duty is as high as 200%. The duty structure varies so much with each State
that for a company operating at the national level, it is like dealing with 28 countries.
Such duties (including special levies on inter-State sales) have resulted in a distributed
manufacturing base and unique market characteristics for each State. Market sources
feel that since States are strapped for funds, adverse changes in policies for the alcohol
industry are unlikely to happen.

Prohibition

Another problem that the industry faces is that of prohibition. Being a major vote-
catching weapon, prohibition has played havoc with the profitability of many breweries
and distilleries. Examples of States clamping prohibition in the past are Andhra Pradesh
and Haryana. Gujarat is another total dry State.

Ban on Advertising

One major restriction throttling the industry is the ban on advertising. Some States have
banned even surrogate advertising of, say, sodas and lemonades. With none of the
State-run television and radio networks accepting liquor advertisements, advertising is
done through private TV channels. Other media have been sponsorship of sports
events, and contests. Recently, advertising on private/cable television channels has
also been banned.
The Black Market

In any industry where there are restrictions, prohibitions and controls, a black market
thrives. So too, in the liquor business.

Fragmented Structure

One fallout of the various restrictions is that, except for a few brands, the liquor market
is fragmented. Nearly 40% of it is serviced largely by regional players. In the case of
beer industry, where volume matters more than price, a mere regional presence is a
disadvantage. Regional presence and the consumer aversion to new brands have
resulted in most companies avoiding the risk of introducing new brands. Instead, they
concentrate on brand extension, trying to build upon existing brand values. Brand
extensions in the Shaw Wallace stable include Haywards, Haywards 2000 and 5000
beer. Similar are the brands Kalyani Black Label and Kalyani Strong in the UB Group’s
stable. Beer sales are also affected by seasonality, with the offtake being generally
higher in summer. Also, the restrictions on production capacity and inter-State
movement usually cause supply to fall short of demand.

Distribution and Trading Restrictions

The distribution of liquor is controlled in many States, except in Maharashtra, West

Bengal and Assam, where companies can sell their products freely in the open market.
Distribution controls take various forms like auctions, open-market system,
government--controlled markets and the Army’s Canteen Stores Department.

Under the auction system, the government fixes a floor price for the shops and the
bidders have to quote prices. The licence would go to the highest bidder, and the bid
price would have to be paid in equated monthly installments. This system operates in
Punjab, Rajasthan, Bihar, Orissa, Uttar Pradesh and Madhya Pradesh.

States following the open-market mode gives substantial leverage to the IMFL
marketing company to choose its distributor and to determine pricing and discounts.

In the case of distribution through government channels and distribution rights through
the auction mechanism, strong distributors exert influence on the margins of the IMFL
manufacturer. In the government-controlled system, the distribution of liquor is done
through State agencies such as TASMAC in Tamil Nadu, BEVCO in Kerala, the Andhra
Pradesh Beverage Corporation in AP, the DSIDC In Delhi, and so on. Since these
agencies are sole wholesalers, they also have the ultimate say in deciding on the entry
of a brand into the State. These restrictions seriously limit the free availability and
marketability of a company's products.
IMFL sales in different States, classified on the basis of the
distribution channel accessible to the manufacturer, are given below:

OPEN MARKET MAHARASTRA,WEST

BENGAL,J&K,GOA,ASSAM,MEGHALYA,TRIPURA,ARUNACHAL
PRADESH
AUCTION UP,RAJASTHAN,MP,BIHAR,PUNJAB,CHANDIGARH,HARYANA
MARKET
GOVERNMENT TAMILNADU,DELHI,KERALA,ANDHRA PRADESH
CONTROL
PROHIBITION GUJARAT,MANIPUR,MIZORAM,NAGALAND
STATES

South India is the largest consumer in the Indian liquor market, with Andhra Pradesh
showing the highest consumption, at 15 mn cases, and a growth rate of 100%. In Kerala
too, the consumption of liquor is high. Consumption in South India has been growing at
a very high rate, compared to North India, which grew at 2% last year. The respective
growth rates for different regions are:

The State-wise consumption of liquor is : Andhra Pradesh (15 mn cases), Bengal (1.7
mn), Assam (1.5 mn), Bihar (2 mn), Mumbai (2 mn), Maharashtra (2 mn), Delhi (2 mn),
Haryana (2 mn), Punjab (2 mn) and Rajasthan (3 mn).
Retailers' Grip

There are an estimated 25-27,000 licensed retail sales outlets in the country for
alcoholic beverages. Retailers have a major role in popularizing and making available a
brand, as they have a virtual monopoly over the distribution of liquor in each State. The
absence of self-service counters also limits customer choice. There are also restrictions
on the business hours of these outlets as also their location vis-à-vis schools, colleges
and so on, apart from where they can procure their requirements. There are restrictions
in selling through restaurants and hotels too.
RECENT TRENDS
Of the few industries that have seen a no-holds-barred entry of MNCs, the alcoholic
beverages industry perhaps tops the list. Most global liquor majors have set up shop in
India, over the past five years, and have actively pursued market opportunities, despite
debilitating constraints. This is because the liquor industry, witnessing a declining trend
worldwide, has shown robust growth in India, bucking the recessionary trends in the
economy and the anti-growth liquor industry policy. Another advantage is that India
offers enough raw materials like molasses, barley, maize, potatoes, grapes, yeast and
hops.

MNCs face numerous hurdles. They have been hampered by the regulatory framework
and distribution hurdles. Most of the MNCs are confined to the premium segment and
denied a level playing field. The Foreign Investment Promotion Board (FIPB) subjects
the MNCs to a capacity ceiling of 10,000 kl (kilolitres). Some companies, like the
International Distillers India (IDI), have cleverly sidestepped this, by contract
manufacture, since there is no ban on outsourcing. MNCs also face the problem of
unfulfilled export obligations arising from the imposition of the foreign exchange
neutrality norm at the time of the FIPB approval. They are lobbying to get the condition
relaxed.

The WTO-mandated removal of import restrictions by April 2001 will permit easy
availability of premium brands. Further, custom duties on alcoholic beverages have
come down rapidly in the last few years, from 400% to 230%. As per the WTO
commitments, duties have to be phased out to 150% by 2003. This is likely to open the
floodgates for alcoholic beverages produced in other countries, particularly so in case of
Scotch whiskies, the consumption of which has decreased substantially globally due to
a growing apathy to hard liquor. The Scotch MNCs are anxious to locate new markets
for their surplus whiskies, and they seem to be eyeing the only positive growth market,
India. But India's custom duties are still quite high and would ensure that the MNC
products are priced out of the market.

India is seeing an increasing trend of white spirits being adopted over brown spirits.
Though key brands in the white spirits segment have been growing at a healthy rate of
20-30%, their total size is small, compared to the overall liquor market.

Exports have been minimal because of the vast market potential within the country.
Shaw Wallace accounts for the largest share in the liquor export market (around 50%).
Companies have been trying to boost exports through technological tie-ups.
PLAYERS IN THE LIQUOR MARKET

The UB group, operating through McDowell & Co. and Herbertsons, are the leaders in
the IMFL market, followed by Shaw Wallace. Mohan Meakin and Jagatjit Industries
(both located in the North) are the other important domestic companies, though both are
considered to be relatively passive.

COMPANY MARKET SIZE (MN BRANDS

CASES)
HERBERTSONS 8 BAGPIPERS
Mc DOWELL & CO. 17 Mc DOWELL No. 1,
DIPLOMAT
SHAW WALLACE 9 DIRECTORS SPECIAL
UDV 3 GREEN LABEL,
SMRINOFF
BACARDI 0.8 BACARDI RUM
SEAGRAM 4 ROYAL STAG
COMMON TERMS IN ALCOHOL

Ageing

Process where a whisky spends time in oak barrels to become the whisky flavour we
know. Very important part of the whisky making process. The whisky stays in the barrels
till it has reached the correct age the distillery requires to receive the best taste. Time in
the bottle does not count to the age of the whisky.

Alcohol

The amount of ethyl alcohol obtained by fermentation. The strength of the alcohol
changes depending how long the it has been distilled. Normally distilled spirits are sold
with an alcoholic strength of 40 percent alcohol.

Blended Whisky

Mixing different grains to produce the whisky taste.

Cask

A barrel which is usually made of oak, used for the ageing of whisky.

Charring

Charring(firing the barrel) the inside of a new barrel to give the whisky flavour as the
whisky ages. This can also be called "toasting".

Distillation

This is done under heat where the alcohol can be collecting after vaporizing because
water will vaporize at a higher temperature when heat is used. The alcohol is then
condensed back to liquid form.

Fermentation

Yeast consuming sugars and converting them into alcohol & carbon dioxide.

Grist

Ground grains used for whisky making.

Malt

The name given to a grain which is usually barley germinate by steeping it in cold water.
In the end more alcohol will be producted because the grain is high in sugar.

Marrying

Allowing a blended whisky time in large containers which can be oak or stainless steel.
This happens before the bottle of the Whisky

Mashing

Cooking grains to release the starch content.

Mouth Feel

The effect that a whisky has on the palate of the mouth. Lingering is just one effect
whisky can have when your are tasting

Neat

A whisky served neat is when no water or other liquid is added and that includes no ice.

Nose

The aroma of the whisky

Oak

The wood used to make barrels for ageing whisky. This is how the whickey receive it's
flavours and develops it's smoothness, finesse, colour and tannin.

Pot Still

The traditional style of still used for distilling whisky. The Pot Still operates in a batch
distillation process.

Rocks

A whisky served "on the rocks" is not diluted, and served over ice cubes.

Tails

This is low in alcohol and is the "tail end" of the distillation. Can be known as feints.
Yeast

This is a living organism that is vital for the fermentation process. It feeds on sugar, and
produces alcohol and carbon dioxide as by-products, but is so important to the whisky
making process.
DIFFERENT ALCOHOLIC DRINKS

1. WHISKY
Whisky is amongst the most popular distilled liquor known all over the world. It is made
of malt and molasses spirit, which is obtained by distillation of mash or cereal grains like
maize, rice barley malt. Better the malt better the whisky. Large quantities of IMFL are
manufactured in India and is the maximum sold alcohol. The content is whisky is 42.8%.

2. RUM
Rum is a distillate from the fermented juice of sugarcane of molasses. RUM is
characterized with its taste and aroma. Best rums are known to come from Jamaica,
West Indies etc. The alcohol content of Rum is 42.8%.

3. BRANDY
Brandy is generally obtained from fruits, thought the most commonly used fruit is
grapes. The best quality of brandy is cognac, which is made in France.

4. VODKA
Vodka is a sprit resulting out of distillation at very high proof. This results in virtual NPN
existence of flavor in the resulting sprit,. This is neutral, even after dilution required for
palpability. The traditional source of making vodka has been potatoes.

5. BEER
Beer is not a distillate like the drinks mentioned above but it is a beverage made by
fermentation of malt obtained form carbohydrate rich material barley. Hops are used to
add taste while yeast is used to ferment the beer.

Beer is to two types:

1. Pilsner or Lager

2. Draught

Lager Beer is the most common bottled Beer found in almost all the retail shops in the
country. This Beer is served chilled and is of two types. Mild Beer alcohol content
6.75%. Strong Beer alcohol content 8.75%.
Draught Beer is served chilled in mugs and is generally available in Pubs only. It can be
stored for 72 hours only and does not have any brand name. Mohan Meakins supports
Draught Beer.

6. GIN: It is sweetened or unsweetened grain spirit flavored with essential oil juniper
berries and some other product including angelica roots, orange peel, cardamom, bitter
almonds give it a kick and taste.
INTRODUCTION ABOUT COMPANY

Simbhaoli Sugars Limited (SSL), formerly known as The Simbhaoli

Sugar Mills Limited (SSML), a 75 years old company is reinventing
itself as a growth oriented, innovative and customer facing enterprise.
A culmination of a process that started at the turn of the century, SSL
has transformed itself into a leaner, fitter and stronger corporation.
The Company has evolved a de- risked growth model that mitigates
the volatility of the commodity market by investing in the diversified
revenue streams, stringent quality and branding, in a cost effective
manner.

Origin

Simbhaoli Sugars Limited (SSL) was established as a partnership firm in 1933 with a
400 TCD (tones of sugarcane crushed per day) sugar unit at Simbhaoli in Western
Uttar Pradesh region of India. It was incorporated in 1936 as a private limited
company. The company went public in 1989 and has followed a stable growth
strategy in its business. In the year 1992 it acquired a distillery and converted its
Simbhaoli sugar plant into a sugar complex.

As we celebrate the 75th birthday of our Simbhaoli Sugar plant, its matter of great
pride to look back on the defining milestones in our seven decades plus existence.
Established by Sardar Raghbir Singh Sandhanwalia in the village that goes by its
name, Simbhaoli was one of the earliest sugar plants to be set up in western Uttar
Pradesh. Over the years, SSL set industry trends for technology, professional
management, product quality, research and innovation efforts, and covenant with
farmers, corporate social responsibility initiatives and welfare schemes for
employees.

Vision

"To be an environment friendly, stakeholder centric, innovative, professionally

managed, integrated sugar refining company with low cost global technologies
producing range of value added products."

Operating Segments
Sugar

SSL has three sugar plants (Simbhaoli and Brijnathpur, western UP and Chilwaria,
eastern UP) with a combined, crushing capacity of 20,100 TCD. It is capable of
producing a wide range of world-class sugars i.e. white crystal refined sugar,
pharmaceutical grade sugar, EU grade sugar (foe exports), superfine sugars, sugar
cubes and candy sugar.

Distillery

SSL has three alcohol distilleries (at Simbhaoli, Chilwaria and Brijnathpur) with a
combined capacity of 210 kilo liters of alcohol/ ethanol per day (KLD). It includes 180
KLD of ethanol/ rectified spirits/ extra neutral alcohol (ENA) capacities. Simbhaoli
distillery is a potable distillery capable of producing a million cases of quality potable
spirits.

Cogenerated Power
Simbhaoli and Chilwaria sugar complexes house bagasse based surplus co-
generation facility of 30 MW/ hour. Biomass-based co-generation projects are
accredited by UNFCCC under the Clean Development Mechanism programme.

Bio-Manure

Each of the sugar complexes house bio-manure facilites with aggregate capacity of
44,000 MTPA. The bio-manure is distributed both to farmers and domestic
consumers across northern India. The Company's research has shown that the use
of organic manure increases crop yields. Further, the Company distributes the
organic manure to its cane farmers at cost or below, for increasing the farm
productivity.

ALCOHOL

Background of Alcohol Business

The first alcohol distillery of SSL was established in 1943 by the same promoters as an
independent company in the name of Simbhaoli Industries Pvt. Ltd. It was merged with
SSL in 1992. This became the foundation of the new line of business for the Company.
AGRI INITIATIVES

The Company has an over 75-year track record of engaging with the rural communities
in improving their quality of life. During this period, It has made purposeful interventions
in infrastructure development, education, healthcare and in generating employment
opportunities, specially in the vicinity of its sugar plants and sugarcane catchments.
Computerization of the cane procurement and payments system commenced way back
in 1988. Company's Farmers Service Center, cane purchasing centres and offices have
direct connectivity with farmers, thereby delivering services at their door-step. SSl has
over seven decades track record of agri- initiatives in the fields of education, healthcare
and infrastructure development in rural areas in the vicinity of Simbhaoli sugar plant.

Improvement in the sugarcane yields is being emphasized by improved agri practices

and seed replacements. This will benefit both the farmer and the Company. Schemes
are implemented alongwith banks having presence in the area to facilitate credit to
farmers for meeting their credit requirements for these purposes. SSL is already acting
as a catalyst to rural growth through channel partners with various banks in its cane
areas. SSL is proposing multi cropping of a number of crops including oil seeds with
sugarcane cultivation in an area of over 10,000 hectares which will result in an increase
in the earnings of farmers by 50 to 75% in its reserved cane area. The Company is
leveraging its strong relationship with over 1,20,000 growers to develop various Agri
products in fertile areas of all the three sugar units. With the growing urbanization and
increase in personal house hold earnings, Agri initiatives are in sync with the present
retail and farming revolution in the country.

Empowering Farmers through Technology

Simbhaoli Sugars's aim is to elevate crop quality and productivity by empowering

farmers to adopt the best agricultural practices. The sugar units are working closely with
their farmers, providing them with valuable advice on each facet of the crop cycle
including agricultural advice on soil and seed management, fertilizer and insecticide
uses, ratoon management, selection of agri inputs, maintaining the proper balance
between the early, mid and late ripening varieties and harvesting cycles. In order to
improve the earnings of the farmers, the Company has initiated intercropping of various
other agri products along with sugarcane in the command area of it's Brijnathpur sugar
plant on pilot basis.

Sugarcane Management

At SSL sugar factories, the entire system of field survey planning, bonding, scheduling
of supply tickets, procurement and delivery of the harvested crop and payments has
been made systematic, transparent and computerized. Payment is credited directly in
the bank accounts of farmers, thereby ensuring a speedy and fair settlement of dues.
SSL is also engaged in promoting new technologies amongst cane growers. Radio base
station is deployed for providing connectivity at all the divisional offices in the cane
areas. This network provides all information regarding farmers at farmer service
centers. It will also help farmers to get their land holding, cane variety wise area, supply
ticket details, payments and loan adjustment details. This avoids waiting in the long
queues at factory gate and all the information is at the click of finger.

Sugarcane Development Activities

SSL sugarcane development activities include:

a) Programme for Varietal Balance

• Switch over the area under early ripening high sugared varieties with incentives
schemes on the propagation of desired varieties.
• Organizing programme under Institute-Industry-Interface.

b) Programme for Increasing the Yield

• Encourage farmers for achieving higher productivity

• Ratoon Management in cane crop.
• Organising Demonstration trials at farmers’ fields.
• Organise training program to farmers.
• Arranging the facilities for soil testing, setting up mobile soil testing labs.
• Organising the trials on the application of micro nutrients/ bio manure.

c) Programme for Selection of High Quality Clones

• Check the suitability of high sugared clones in the local environment.

• Organizing the varietals trials with variety-wise cane growth observations.

d) Effective Control Measures of Insect-Pest and Diseases

Through insecticides and pesticides

• Arranging insecticides and pesticides to farmers at subsidized rates.

• Conducting various campaign time to time for effective control.
• Giving cash subsidy to Cane Development Council for distribution of insecticides,
pesticides and agriculture equipment.

Through Biological Control e) Research and Development Programme

• Establishment of biological lab for rearing the parasite / fungal to control various
borers and diseases.

f) Other Rural Development Initiatives

• Regular cleaning of drains (100 kms) at Simbhaoli sugar plant area to over come
the water logging problem in the command area.
• Laying of Hume pipes for the repair and constructions of passage / culvert on
village roads.
• Constructions of approach link roads.
• Family health camps and providing drinking water.
• Working towards providing micro credit to the farmers.
• Running a school at beginning level.
Present Activities:

The Simbhaoli facility houses a distillery with a capacity of 90 kilo-litres per day (KLD),
which is capable of producing up to 60 KLD of ethanol and 45 KLD of extra neutral
alcohol (ENA). The plant has a capacity to produce 1 million cases of the potable spirits.
In addition, 30 MT per day of carbon dioxide is also recovered and sold. ENA is a raw
material used for manufacturing high quality potable liquor, including whisky, rum,
and gin. This potable liquor is sold in northern India under the brand names,
Hunters/Simbhaoli XXX (rum), Seven Knights (Whisky), Seven Knights Lemon flavour
dry Gin, Gorki (Premium Vodka) and Ice Blue Tango. These brands have been
developed after extensive research (product and packaging) and as per the choice and
taste of consumers. Under the country liquor category the Company is creating brand
awareness of its 'Dildar' brand for sale in the state of Uttar Pradesh.

Raw material used in distillation process is molasses from the sugar mill and balance
requirement is procured from the nearby sugar mills. Quality of the spirits is excellent as
it is distilled from four columns distillation process. The Simbhaoli distillery is supplier of
bulk sprits to most of the market leaders of IMFL products in India.

The technologically advanced ethanol plant is fully automated and employs the new
generation molecular de-hydration sieve technology. The Chilwaria and Brijnathpur
distilleries have a capacity to produce 60 KLPD of fuel ethanol with an optionality to
produce high quality spirit of same quantity.

Simbhaoli distillery has a maturation capacity of 6 lakh liters of spirits for manufacturing
of premium bottled liquor. Presently, it is selling the potable liquor in the states of Uttar
Pradesh, Rajasthan, Haryana, Kerala, West Bengal, Nagaland, Punjab, Delhi etc. It is
also catering to the requirements of paramilitary forces. The market acceptability of the
SSL spirit brands is encouraging. Now planning to re- enter the market with premium
brands and also propose to introduce White Rum, Dark Rum in semi premium
segments.
 FUEL ETHANOL

ETHANOL- AN EMERGING DIVERSIFICATION

Ethyl alcohol is one of the co- products of the sugar industry. It is either made directly
from sugarcane or from Molasses, which still contain some sugar, but this sugar cannot
be extracted using current technologies. These Molasses are fermented with yeast to give
ethyl alcohol. The mixture is then distilled to separate the alcohol from the mixture. Thus
separated alcohol is about 95% pure and finds uses in pharmaceuticals, potable uses,
industrial uses, and it can be further purified to about 99.5% purity to give Fuel Ethanol

Fuel Ethanol

SSL has three fuel ethanol plants having an aggregate capacity of 180 KLD. The
technologically advanced ethanol plants are fully automated and employ the new
generation molecular de-hydration sieve process. These plants have the option to
produce ENA with minor modifications, if desired. The fuel ethanol is supplied to
petroleum marketing companies in India.

The ethanol-blending program announced by the Government of India in December 2002

has opened an additional revenue stream for the sugar industry in India. Currently, only
5% ethanol-blending of fuel is mandated by the central government in entire country
(other than North Eastern States), which would be increased to 10% from October, 2008.
This presents a large potential demand for ethanol in India

The Ministry of Petroleum has estimated demand for ethanol-blended fuel to be

approximately 1.2 billion litres at 10% blending in the year 2008-09.Presently, at 5%
blending the ethanol demand is estimated at 600 mn ltr per annum.

Global Scenario:

Various Governments are providing incentives to expand Ethanol production and use.
Brazil and United States use large quantities of Ethanol as a fuel. Some Canadian
provinces promote Ethanol use as a fuel by offering subsidies of up to 45 cents per gallon
of Ethanol. In France, Ethanol is produced from grapes that are of inferior quality for wine
production. Prompted by the increase in oil prices in the 1970s, Brazil introduced a
program to produce Ethanol for use in automobiles in order to reduce oil imports.
Brazilian Ethanol is made from sugar cane. Pure Ethanol (100% Ethanol) is used in
approximately 40 percent of the cars in Brazil. These cars are known as Flex Fuel cars
since they provide an option of using petrol or Fuel Ethanol or both in any proportion. The
remaining vehicles use blends upto 24 percent Ethanol with 76 percent gasoline. Brazil
consumes nearly 4 billion gallons of Ethanol annually. In addition to consumption, Brazil
also exports Ethanol to other countries.

Brazil and the United States are the largest ethanol producers, accounting for roughly
38% and 29% of the world market, respectively. In the United States , over 3.6 billion
gallons of ethanol are blended with gasoline every year. On January 31, 2006 in his
policy statement the US President recognized the future of ethanol as not only a blending
component, but as a mixture of 85% ethanol and 15% gasoline.

Indian Scenario:

The ethanol-blending program announced by the Government of India in December 2002

has opened an additional revenue stream for the sugar industry in India. Currently, only
5% ethanol-blending of fuel is mandated by the central government in entire country
(other than North Eastern States). It is believed that they may increase this to 10% in
entire Country by next year. This presents a large potential demand for ethanol in India.
This, coupled with the additional demand for industrial and potable alcohol, will require
sugarcane production to grow at 8-10% annually during fiscal 2005-08. The sugarcane
production has grown by only 1.5% annually during fiscal 1999-2004.

The Indian government has recommended that approximately 10% of all total energy
produced should come from renewable sources and has made sale of ethanol-blended
unleaded petrol recommendatory. The Ministry of Petroleum has estimated demand for
ethanol-blended fuel to be approximately 12 billion litres by 2007-08, which would mean
an ethanol requirement of approximately 600 million litres (at 5% blending) or 1.2 billion
litres (at 10% blending).

Simbhaoli Sugars foray into fuel Ethanol:

The SSL has two Fuel ethanol plants having an aggregate capacity of 120 KLD. This will
further go up to 180 KLD by March 2007 with the commencement of Brijnathpur Distillery.
The technologically advanced ethanol plants are fully automated and employ the new
generation molecular de-hydration sieve process. These plants have the optionalty to
produce ENA with minor modifications, if desired, meeting the international standards.
The Fuel Ethanol is to be supplied to petroleum companies in India.
TECHNOLOGY INITIATIVE

DRPIE Technology

In the year 2003, SSL successfully replaced the conventional double sulphitation
manufacturing process at its Simbhaoli sugar plant with the revolutionary Defeco
Remelt Phosphatation and Ion Exchange (DRPIE) technology. DRPIE is an
internationally accepted refinery process that eliminates the use of sulphur and other
harmful chemicals. DRPIE Sugar is 100 per cent pure, refined and sparkling white -
totally free from suspended solids and impurities.

The Company has adopted various energy economy measures, which have led to
reduction in the steam consumption. Simbhaoli Distillery Division has also expanded its
rectified spirit capacity to 90 Kl/day and ethanol capacity to 60 Kl/day without spending
major amounts on steam generation equipments.

QUALITY CONTROL

Our quality control systems extend from the laboratory to the farmland and on to the
manufacturing floor. Research farms at Simbhaoli and Chilwaria grow specifically
approved cane varieties, which are closely monitored for disease and pest resistance.
The results are regularly communicated to farmers.

On the shop floor, we conduct detailed analysis to measure the colour, sediment level,
ash content, particle size distribution and bacteria levels in the sugar. The aim? To
produce 100 per cent pure, sparkling white sugar. That’s why Simbhaoli Sugar
conforms to the European quality standards with an ICUMSA of less than 45.

INTERNATIONAL QUALITY CERTIFICATION

Simbhaoli Sugars has adopted integrated management system comprising of ISO 9001:
2000 for Quality Management System, 14001:2004 for Environment Management
System and HACCP for food safety for its Simbhaoli sugar and distillery complex. ISO
9001: 2000 is the international quality management system standard to improve
customer orientation and overall quality system, ISO 14001:2004 certifies that the
Company is a responsible corporate entity and respects the environmental issues, and
the HACCP Certificate ensures highest product quality to all the customers. It is the only
sugar company in India having all the three international quality certificates in a single
year. During the year 2008, the Company has got status of "Start Trading House" from
the Ministry of Commerce for performing excellence in international trading.
BRAND BUILDING

Trust Sugar

SSL was amongst the first to introduce branded sugar in Indian markets during the
year 1994. The product brand was introduced under the name of `TRUST` in 1 Kg. and
5 Kgs consumer packs. The product is different from the other ordinary sugar in the
following respect:

• Sparkling white
• Uniform grain size
• Un-touched by human hands
• Free flowing
• Pure and Hygienic. Certified by FDA
• No sulphur is added in the processing
• Meets European standard of refined sugars ( can be exported to any country
including European Union)

The strategy behind introduction of Trust brand is to offer a product to the consumer,
which meets stringent standards of hygiene, convenience and quality. The research
showed that the branded sugar has a good market potential. Keeping this in view SSL
introduced other sugar related products like sugar cubes, sugar sachets, icing sugar,
golden brown, breakfast sugar and specialty sugars.

Potable Liquor

A comprehensive marketing policy is being pursued to mark a space in the premium

potable liquor market. SSL alcohol division is taking steps to promote branding activities
to strengthen its presence in the states of Uttar Pradesh, Kerala, Delhi, Punjab,
Rajasthan, Uttaranchal and West Bengal. It has also entered into new markets of North
Eastern States of India.

SSL has a brand portfolio comprising six brands of liquor. It has added four new brands
to its IMFL product basket in theyear 2007- Gorki Vodka, Seven Knights Whiskey,
Seven Knights Dry Gin and Blue Tango, making the total number of brands equal to ten.
Following are the premium brands under the potable liquor segment:

Ice Blue Tango - This splendid Gin is mixture of high of high quality smooth spirits,
natural herbal extracts and the purest from of sugar syrup. This gives a youthful effect
with sweet taste of orange flavour in Gin.
CORPORATE CITIZENSHIP

SSL has developed the practices to fulfill its corporate and social responsibilities to
various stakeholders and believes in adopting good governance, which is founded upon
the principles of transparency, monitoring, accountability, growth-oriented approach,
trusteeship, corporate citizenship and environmental consciousness. The corporate
governance process consists of various business practices, which not only results in
working towards sustainable and least risk earning model and enhancing shareholders
wealth but also enables the Company to fulfill its obligations towards its suppliers,
customers, employees, lenders and to the society in general.

SSL corporate governance norms fulfill business ethics as an enabling and facilitating
process encompassing all its functions at different levels. The management follows the
policies of compliance, protection of the rights and interests, equality in dealing with all
the shareholders, act as a trustee of shareholders capital, transparency in business
dealings, timely disclosures, effective internal and external communication, strategic
guidance and monitoring and the accountability to the Company and its shareholders.
MANAGEMENT TEAM AT SIMBHAOLI

The Board of Directors of SSL is responsible for overall management, control and
supervision. The Chairman and Managing director (CMD) is assisted by the Deputy
Managing director (DMD), Executive Director (ED) and Director Finance (DF) for
carrying out day-to-day management under the supervision, direction and control of the
Board. The Company has employed a number of professionals in various areas of
management.

Mr. Gurmit Singh Mann, Chairman and Managing Director

Mr. Mann is a member of the promoter group. He has over 42 years of experience
including 34 years with Simbhaoli Sugars Limited and 8 years with the marketing
department of M/s Smithkline Beecham Consumer Healthcare Limited (formerly HMM
Ltd.). He has been the President of the Indian Sugar Mills Association, and Chairman of
the Indian Sugar & General Export Corporation Limited. He has been the Managing
Director of Simbhaoli Sugars Limited since 1972 and became Chairman of the
Company in the year 1989.

Mr. Gurpal Singh, Deputy Managing Director

Mr. Gurpal Singh is a member of the promoter group. He has over 22 years of
experience in the management of the various functional areas of the Company and its
divisions. He joined the Board in the year 1986.

Dr. G.S.C.Rao, Executive Director

Dr. Rao, a professional, is the Executive Director of the Company. He has 29 years of
experience at senior levels. He joined the Board in 2000. He has a Masters degree in
Science and a Doctorate degree in the field of sugarcane physiology and biochemistry
breeding. He also holds a postgraduate diploma in management. He is a member of
sugar technology mission advisory committee and a special invitee to the governing
body of the Uttar Pradesh council of sugarcane research.
Mr. Sanjay Tapriya, Director (Finance) & Company Secretary

Mr Tapriya is the Director (Finance) & Company Secretary of the Company. He has
over 20 years of experience in the fields of secretarial, legal, commercial, accounts and
finance with Simbhaoli Sugars Ltd. He joined the Board in 2003. He is a member of The
Institute of Chartered Accountants of India and The Institute of Company Secretaries of
India.

Experienced Management Team

(As on December 31, 2009)

The Company is led by an experienced management team under the guidance of its
Chairman and Managing Director, Mr. Gurmit Singh Mann, who has over 30 years
experience in the Indian sugar industry, is ably supported by his talented executive
team.

Board of Directors
Name of Director Directorship
Mr. Gurmit Singh Mann Chairman and Managing Director/ Promoter
Mr. Gurpal Singh Executive/ Promoter
Dr. G.S.C. Rao Executive, Chief Operating Officer
Mr. Sanjay Tapriya Executive, Cheif Financial Officer
Mr. S. K. Ganguli Independent
Mr. S. C. Kumar Independent/ Non-Executive
Mr. Yashwant Varma Independent

Key Managerial Personnel

The Board of Directors is responsible for overall management, control and supervision.
The Chairman and Managing director is assisted by the Deputy Managing director,
Executive Director and Director Finance for carrying out day-to-day management under
the supervision, direction and control of the Board. The Company has employed a
number of professionals in various areas of management:

Name Functional Role

Dr. G. S. C. Rao Chief Operating Officer
Mr. Sanjay Tapriya Chief Financial Officer
Mr. Indeep Singh Bhatia Unit head Simbhaoli Sugar Plant
Mr. Naveen Tyagi Unit head Brijnathpur Plant
Mr. Ajay Verma Unit Head, Chilwaria Plant
Mr. R. K. Singh Unit head Simbhaoli Distillery
Mr. A. K. Srivastava Corporate head, Technical
Mr. S. C. Reddy Corporate head, Agriculture and sugar cane
Mr. Sunil K. Gupta Corporate Head Accounts and Finance
Mr. A. P. Singh Corporate head, Cogeneration
Mr. Shiv Sinha Head Marketing (Premium Spirits)
Mr. Rajiv Bhatia Head Marketing (Sugar)
Mr. Dilip Jain Head Project Development
Ms. Gursimran Kaur Mann Head Business Promotion
Mr. Kamal Samtani Company Secretary

Share Holders Information

Listing on Stock Exchanges

Equity shares

National Stock Exchange of India Ltd. ISIN Code: 270C01017

Plot no. C/1, G Block,
Bandra-Kurla Complex
Scrip Code: SIMBHSUGAR
Mumbai - 400 051.
Web site: www.nseindia.com
Tel No: 91-022 26598100 - 8114
 Fax No: 91-022 26598120
E-mail : cc_nse@nse.co.in

Bombay Stock Exchange Limited Scrip Code: 507446

Phiroze Jeejeebhoy Towers, Dalal Street,
Mumbai.
Web site: www.bseindia.com
Tel: 91-22 2272 1234 /33,
Fax: 91-22 2272 3677

Foreign Currency Convertible Bonds

Singapore Exchange Limited ISIN Code: XS0246465560
2, Shenton Way, # 19-00,SGX Centre,
1, Singapore 068804
Web site: www.sgx.com
Tel (65) 6236 8888
Fax (65) 6535 6994

Depositories

i) National Securities Depository Limited Tele. Nos.:022-24994200

Trade World, 4 th Floor, Kamla Mills Compound, Fax No. 022-24972993/ 2497
Senapati Bapat Marg, Email : info@nsdl.co.in
Lower Parel, Mumbai – 400 013. Website : www.nsdl.co.in

ii) Central Depository Services ( India) Limited: Phiroze Tele. Nos:022-2272333

Jeejeebhoy Towers, Fax No.:022-22723199
28 th Floor, Dalal Street, Email: investors@cdslindia.com
Mumbai – 400 023. Website: www.cdslindia.com

International Securities Identification Number is ISIN- INE 270C01017

COMPETITIORS PROFILE

Today’s world is the competition. In every filed there is competition and the success of
any company or product largely depends upon competition. Competition provides a
good quality of product to the customer. If a company has to survive in the market, then
it has to face throughout competition. In liquor industry too the competition is there. The
increasing awareness and exposure to beer among consumers and the removal of
quantitative restrictions gives big boost to the beer industry. It saw the emergence of
new companies like future wine and spirit brand (P) Ltd (FWSB), set up recently by two
Non-Resident Indians (NRI’s) from USA. ‘WHISKY’ consumption in the country
increased 12-14 % per year

The major player in alcohol market and the competitors of Simbhaoli are as follows:-

Radico khaitan:- Radico Khaitan is one of India's oldest and largest liquor
manufacturers. Formerly known as Rampur Distillery which was established in 1943. It
was only in 1999, that Radico decided to launch and market its own brands, thereby
embarking on a period of phenomenal growth. To further boost its production capacity
of bottled and branded products, the company has tied up with bottling units in various
parts of the country.
The Brand Story

Radico Khaitan Ltd today has three millionaire brands in its portfolio. Radico's flagship
brand, 8 PM Whisky, launched in 1999, was a runaway success. In the first year alone, it
sold one million cases - a record for any Indian or foreign brand operating in India. This
also made it the first brand in the liquor industry to make it to the Limca Book of
Records. The other millionaire brands are: Contessa Rum has won the prestigious
Monde Selection award for its overall quality for the past three executive years. It has a
large market share in the defense market. Old Admiral Brandy has also won the Monde
Selection award for its overall quality in 2008. Today, Radico Khaitan has brands that
straddle almost every market segment - whisky, rum, brandy, vodka & gin - and price
category. Our fine blends, consistent quality, distinctive

Rampur Distillery

Rampur Distillery is one of the largest distilleries in India and a leading manufacturer of
Extra Neutral Alcohol (used in
manufacturing Indian Made foreign Liquor) it also manufacturers Rectified Spirit (used in
manufacturing of lower
segments Country Liquor) and manufacturing of Anhydrous Alcohol or Ethanol or
Gasohol (used in Petrol Mixing) and
the recent addition of grain distillery . Today with a production capacity of 60 million
liters p. a and with the recent
addition of the grain distillery which has taken the capacity upto 90 million lit p.a it is one
of the largest distilleries in
the country The Unit has a series of firsts to its credit:

• It is the first Indian distillery to obtain ISO 9001:2000 certification

• t has achieved capacity utilization of over 100% in the alcohol plant
• It is the first environment-friendly distillery in the country

Capacity

Molasses Distillery 60 million litres per annum

Grain Distillery 30 million litres per annum
Malt Distillery 460 thousands liters per annum
The overall licensed capacity has been increased to 125 million liters per annum

Effluent Treatment Plant

The effluent Treatment Facility in Rampur Distillery is unique in nature when compared
among and in the Industry. The Distillery complies with Zero Discharge concept set up
by CPCB. The treatment has varied by products, which not only improves operational
stability of the plants but also adds on to company's profitability. Primary Treatment of
the Effluent yields Bio Gas, which is used as fuel in Cogen Boiler to generate steam and
then Power through a backpressure Turbine. The backpressure steam is used again in
the Distillation Plant to produce Extra Neutral Alcohol and Rectified Spirit.

Environmentally Friendly

Meeting out 100% Pollution Control norms, the Treated Effluent is not discharged
outside and in turn is mixed and cured with organic mass like Press Mud of Sugar Mills
and suitable organic manures to manufacture Bio Manure or Bio Compost, a bio
fertilizer used successfully in growing the crop of sugar canes etc.

Cogeneration Plant

The cogeneration plant of Rampur Distillery consist of 26 MT capacity India's first stand
alone Bio Gas fired steam boiler and 2 MW Turbine Generator in tandem to make
Radico Khaitan self reliant on its requirement for power for its normal operation.

Backward Integration

The very first backward integration project has come in the form of setting up a fully
automatic 750 ml Kidney shape PET bottle manufacturing plant in low cost and tax
benefited area like Uttranchal. The unit started with production rate of 85 lacs bottle per
year in October 2004 and is now geared up to produce 255 lacs PET bottles to cater
Radico's own captive consumption of approx. 150 lacs bottle per year and rest is being
sold to outside clients in similar businesses. The unit has not only eliminated the
pressure of PET bottle suppliers but has also provided a kind of diversified
manufacturing base for future business exploration.

Major brands of RADICO KHAITAN

2007-08 13.07 million cases

2006-07 13.05 million cases
2005-06 12.00 million cases
2004-05 10.00 million cases
2003-04 06.30 million cases
2002-03 04.70 million cases
2001-02 03.6 0million cases
UB GROUPS:- United Spirits Limited (USL) - the INR 5700 crore spirits arm
of the UB Group – is India’s largest and the world’s third largest spirits company. USL
was earlier McDowell and Company Limited. USL has a portfolio of more than 140
brands, of which 19 are millionaire brands* (selling more than a million cases a year)
and enjoys a strong 59% market share for its first line brands in India. United Spirits
recorded global sales of 90 million cases for the fiscal year that ended on March 31,
2009.

United Spirits’ brands have won the most prestigious of awards across flavors, ranging
from the Mondial to International Wine and Spirit Competition (IWSC) to International
Taste and Quality Institute (ITQI); a total of 108 awards and certificates (as of June
2009). The company is known to be an innovator in the industry and has several firsts to
its credit such as the first pre-mixed gin, the first Tetrapack in the spirits industry in
India, the first single malt manufactured in Asia and the first diet whisky in the world.
USL has constantly revamped itself and its brands to keep pace with the changing
business dynamics and global competition. The company's ultimate objective of
becoming the largest spirits company in the world received a major shot in the arm
during 2007 with the acquisition of internationally renowned brands (companies) such
as Whyte & Mackay, Bouvet Ladubay and PinkyVodka.

And yes. with such a head start, the excitement continues as USL is geared for an
action-packed year, which will drive it further closer to becoming the No. 1 spirits
company in the world.

Besides Whyte & Mackay and Bouvet Ladubay being 100% subsidiaries of USL, the
company has 19 millionaire brands (selling more than a million cases a year) in its
portfolio and enjoys a strong 59% market share for its first line brands in India. United
Spirits' brands have won the most prestigious awards for flavors, ranging from Mondial
to International Wine and Spirit Competition (IWSC) to International Taste & Quality
Institute (ITQI); more than 99 awards & certificates.

The Company is known to be an innovator in the industry and has several firsts to its
credit like the first pre-mixed gin, the first Tetrapack in the spirits industry in India, first
single malt manufactured in Asia and the first diet versions of whisky and vodka in India.

USL has a global footprint with exports to over 18 countries. It has a sizeable presence
in India with distilleries and sales offices all across the country, and a committed team of
over 7500 people dedicated to the fulfillment of the company's mission. It has
established manufacturing and bottling plants in every state of India. In addition, to
deliver its products to customers located anywhere in India, USL has established a
robust distribution network covering the whole country.

USL Millionaire Brands (Those that sell more than a million cases per annum)
Particulars Total Number Comments
Brands 140 19 of these are millionaire brands and there are about 151 brand
variants
SKUs 2992 Distillery-State-Brand-Pack combinations
Distilleries / Bottling Units 74 27 Owned Manufacturing facilities;40 contract manufacturing units

Depots 48 Break-bulk points for finished goods distribution

Retail Outlets 64000 Inclusive of both on and off premise outlets

Whisky Brandy Rum Vodka & Gin

• Bagpiper • McDowell’s No.1 • McDowell’s No.1 • • Celebration Rum • White Mischief •
• Director’s Special • Old Tavern Honey Bee • John • Old Cask Rum • Old Romanov
• Haywards • McDowell’s Green Label • Gold Ex-Shaw Adventurer Rum • Blue Riband
Riband • Royal Challenge • DSP Black •
Signature
MOHAN MEAKIN;- A saga that began over a century and a half ago, continues on
its path of service to the world with dedication, courage and an unflinching commitment
to quality. Over the years the Company has embraced modernity and adapted to
changing times. Yet, its basic values remain the same--Integrity, Craftsmanship, and
Tradition. From old tradition sprang Mohan Meakin where the sanctity of ancient culture,
technological development and craving for quality are artfully blended into the products.

The origin of Mohan Meakin traces back to Edward Dyer from United Kingdom who set
up the first-ever brewery and made indigenous beer available to the Indians as well as
Britons. He set up more Breweries at Solan, Simla, Murree, Rawalpindi and Mandalay.
Another entrepreneur H G Meakin came to India from Britain and bought the old Simla
and Solan Breweries from Edward Dyer and added more at Ranikhet, Dalhousie,
Chakrata, Darjeeling and Kirkee.

A distillery was then set up at Kasauli instead. Another distillery was set up in the
historic city of Lucknow. In addition to meet the increased demand of Mohan Meakin
Products an Industcrial Complex on 150 acres of land was set up in the year 1960 near
Dehli in Ghaziabad Distt. of Uttar Paresh. Mohan Meakin have established fully
equipped labratories at its various manufacturing centers manned by highly qualified
and experienced technical persons to ensure the maintenance of high standard quality
products.

MAJOR BRANDS OF MOHAN MEAKINS:-

Solan No. 1 Malt Whisky
Summer Hall
Colonel’s Special Malt Whisky
Golden Eagle
Diplomat Deluxe Malt Whisky
Black Knight Malt Whisky
King Castle
Celaar 117
M.M.B. Whisky
Old Monk Supreme
Old Monk Gold Reserve
Old Monk White Rum
Black Beauty
Old Monk XXX Rum

SHAW WALLACE:- Established in Calcutta in 1886, Shaw Wallace bears a legacy

that is drenched in the spirit of India for the last 116 years. The company came into
existence at a time when the country was in the thick of its struggle for freedom against
colonialism. It was an era of cataclysmic change, powered by the crystallization of the
social, political, cultural and economic ideologies that would define the very future of
India.

The Indian Nationalist movement came to the fore under the leadership of W. C.
Bannered in Bombay barely a few days after Shaw Wallace was founded. If 1886
marked the inception of the remarkable Rama Krishna Mission by Swami Vivekananda
following the demise of one of the greatest Indian saints, Ramakrishna Paramhansa it
also witnessed the release of Rabindranath Tagore's literary masterpiece Kari-o-Cool.
Set against a backdrop of changing ideas and structures that governed India's
germination into an independent entity, Shaw Wallace after a modest beginning
blossomed into one of the forerunners in the alcohol and beverage industry.

Throughout its long and rich journey, Shaw Wallace has had many a first to its credit.
The company was one of the first importers of motor cars in India during the beginning
of the 20th century. Shaw Wallace was also the first agent in India of a wireless
company- Marconi's Wireless Telegraph. In 1926, it acted as an agent of an airline, the
'Imperial Airways'.
Shaw Wallace marked another milestone in 1987, when the company came under the
dynamic leadership of the Jumbo Group, spearheaded by the late Mr. M R Charier. His
boundless vision and business acumen has further cemented the position of the
company, taking it to dizzying heights of success.

The Shaw Wallace motto has been to live and breathe innovation with the consistent
launch of new products and variants to cater to emerging needs of its consumers. In the
last century, the company has risen consistently to the challenges that have come its
way establishing a niche that cleverly captures the varied and ever-changing taste of
alcohol consumers the world over. Today Shaw Wallace has a host of liquor and beer
brands that have become synonymous with the highest quality and the best of times.
MAJOR BRANDS OF SHAW WALLACE:-

ROYAL CHALLENGE

DIRECTOR SPECIAL

DIRECTOR SPECIAL BLACK

ANTIQUITY PREMIUM WHISKY

SEAGRAMS:- Seagram India, a Pernod Ricard Group Company, the world's

second largest wine and spirits conglomerate, the name that's synonymous with world
renowned wine brands such as Jacob's Creek ( Australia), Montana (New Zealand) &
Mumms Champagne, and the finest spirit brands like Royal Salute, Chivas Regal, The
Glenlivet & 100 Pipers.

Royal Stag is an Indian-made foreign liquor. It is a blended whisky and is a blend of

imported Scotch Malts and selected Indian Grain Sprits. Seagram’s markets it in India. It
is produced in several distilleries, some are company-owned and others bottler-owned.
One of the key reasons for the brand’s success is its quality that is always same.
Seagram has launched this brand especially for Indian market and it’s a big hit. The
Royal Stag (RS) is one of the species of deer that is famous for its antlers soaring over
all other species of deer. Like the deer this blended whiskey has emerged as one of the
major players in Indian alcoholic beverage market.

It is a blend of the best scotches malts from Scotland and Indian grain spirits. ROYAL
STAG Deluxe whisky is a full-bodied whisky.
Seagram is now part of Pernod Ricard due to worldwide takeover. Pernod Ricard
produces and distributes many prestigious brands in many categories of alcoholic
beverage. Some of world famous brands of this group are: Ricard, Seagram’s
Gin, Chivas Regal, Royal Salute, Larios, Clan Campbell, Havana Club, Jameson,
Martell, Ramazzotti, Wyborowa, Wild Turkey, Jacob’s Creek and Wyndham Estate.
These brands are either global leader or one of the top selling brands of a select
market. This list is from their website, I have tested only the highlighted one.

Pernod Ricard group is marketing more than 100 famous brands around the globe.
Royal Stag is one such brand being marketed in India and Nepal as per requirement of
these markets

Market Scenario

Royal Stag is the leading whisky in the Indian market. It is placed in prestige category
and priced to target the common man. As per their website it enjoys 27% of Indian
market. Reasons behind its fast growth are Price and Quality. It is a Herculean task to
match its price and quality. It seems to be the fastest growing brand in Indian market.
Annual sales of Seagram’s Royal Stag whisky have crossed over one million cases.

Royal Stag is the only second brand from a multinational liquor house, after Green
Label whisky, to achieve the `Millionaire’ status in Indian market for whiskey. It has
made rapid progress in the Indian market in the last five years and pulled up its sales
from around four lakh cases in 1997 to the present ‘Millionaire’ status.

MAJOR BRANDS OF SEAGRAMS:-

ROYAL STAG

IMPERIAL BLUE

BLENDERS PRIDE

100 PIPERS

CHIVAS REGAL

PASSPORT

GOLD CLASSIC

BOSTON CLUB

MASTER BLEND

CROWN ROYAL
AMRUT DISTILLERIES:- The history of Amrut Distilleries is as old as the history of
independent India itself. Indeed, just as India itself, after six decades of notable
progress, is now noted as among the global economic leaders, so too has Amrut
Distilleries grown both in stature and in size. Among the earliest to enter the then
arcane field of liquor making, Amrut Distilleries Limited began in 1948 under the name

and style of Amrut Laboratories, with an initial investment of barely a few lakhs. The
founder was the late Shri J.N. Radhakrishna, J.N.R as he is fondly called to this day.
Much of this fascinating story was made possible by the resolve of successive
generations of the Jagdale family to embrace value and to discount form for substance.
Under the leadership of the founder, Amrut Distilleries made rapid strides to entrench
itself as a significant, for many the preferred, supplier of Indian Made Liquor (IML) in the
Defence Market. In its state of origin, Karnataka, too, Amrut Distilleries grew to be one
of the dominant suppliers, especially in the old Mysore area. After the untimely demise
of J.N. Radhakrishna Rao Jagdale in 1976, the mantle devolved on his son, Shri
Neelakanta Rao, the present Chairman and Managing Director. Building on the solid
foundations laid by his later father, his stewardship has seen Amrut Distilleries blossom
into a multi-national brand respected as much for the superlative quality of its products
as his campaign for transparent practices by the IML industry.

His penchant for innovation and technology-upgrade has been the ideal foil for the time-
tested traditions enshrined by the founder. From its beginning as single bottling unit
catering primarily to the Canteen Stores of the Ministry of Defence and to local
customers in and around Bangalore, Amrut Distilleries has now grown into a trans-
national player with:-

a) A re-distillation plant to produce superior extra neutral alcohol for captive

consumption.

b) Two bottling units – 1 each in Karnataka and the neighboring state of Kerala.

c) Local bottling arrangements with know-how provided by Amrut Distilleries in five other
states of India.

d) A portfolio of dozens of products including several that are appreciated by the

connoisseurs across the world.

e) An established market spanning the length and width of the country,and

f) A nascent but burgeoning market across the European Union.

Growth in the product portfolio and in its market size has brought concomitant growth in
the financials too. With a paid-up share capital of Rs. 20 million, the company sports a
financially healthy look with accumulated reserves exceeding Rs. 250 millions. Turnover
has grown astronomically from a mere few lakhs to Rs. 1500 millions a year today. To
manage and deliver on its present status as noteworthy national player, the company
has also taken on board external talent in substantial numbers and boasts today of a
more than thousand-strong workforce of professionals and skilled staff at its various
units.
MAJOR BRANDS OF AMRUT:-
AMRUT INDIAN SINGLE MALT WHISKY
AMRUT INDIAN SINGLE MALT WHISKY (cask strength)
AMRUT PEATED INDIAN SINGLE MALT WHISKY
AMRUT FUSION SINGLE MALT WHISKY
AMRUT TWO CONTINENT SINGLE MALT WHISKY
AMRUT PEATED INDIAN SINGLE MALT WHISKY (cask strength)
MAQINTOSH WHISKY
MAQINTOSH PREMIUM WHISKY
MAQINTOSH SCOTCH WHISKY
DIAGEO
Diageo is the world's leading premium drinks business with an outstanding collection of
beverage alcohol brands across spirits,wine and beer categories. These brands
include: Smirnoff, Johnnie Walker, Captain Morgan, Baileys, J&B, José Cuervo,
Tanqueray, Guinness, Crown Royal, Beaulieu Vineyard and Sterling Vineyards
wines, and Bushmills Irish whiskey.

Diageo is a global company, trading in over 180 markets around the world. The
company is listed on both the London Stock Exchange (DGE) and the New York Stock
Exchange (DEO).

We employ over 22,000 talented people worldwide with offices in around 80 countries.
We have manufacturing facilities across the globe including Great Britain, Ireland,
United States, Canada, Spain, Italy, Africa, Latin America, Australia, India and the
Caribbean.

Diageo was formed in 1997, following the merger of GrandMet and Guinness, and is
headquartered in London. The word Diageo comes from the Latin for day (dia) and the
Greek for world (geo). We take this to mean every day, everywhere, people celebrate
with our brands.

MAJOR BRANDS OF DIAGEO:-

JOHNNIE WALKER

SMIRNOFF

CAPTAIN MORGAN

J&B
BAILEYS

BLACK & WHITE

VAT 69

How SIMBHAOLI can launch its new brand in semi premium range of
whisky?

As we have seen there are various competitors of SIMBHAOLI in the market, so for
launching a new brand in the market in semi-premium range of whisky, company have
to work extensively in forming marketing strategy for launching a new brand.
There are various mode of promoting a new brand for that company has to form a good
sales promotion technique.

Sales Promotion:

Definition:
It covers marketing activities other then advertising, publicity and personal selling that
stimulate consumer purchasing and dealer effectiveness. Such activities are displays,
shows, exhibitions, demonstrations and many other non routine selling efforts like spot
selling. Sales promotion tries to complement the other means of promotion given above.

All kinds of promotion play the role of communication channels between the marketer
and the consumer. Promotion as on element of marketing mix has three broad
objectives: (a) Information, (b) persuasion, (c) reminding.
The overall objective of promotion is, of course, influencing the buyer behavior and his
predispositions (needs, attitudes, goals, beliefs, values and preferences).

According to the American Marketing Association, the sales promotion can be defined
as “Those marketing activities other then personnel selling advertising and publicity, that
stimulate consumer purchasing and dealer effectiveness, such as displays, show and
exhibition, demonstration and various non-current efforts not in the ordinary routine”.

Objectives of the Sales Promotion:

There are many ways by which sales can be increased and more orders can be
obtained. This can be done by increasing advertising publicity and market research. The
major objective of sales promotion are :-
• To increase the sales.
• To make the customer aware of the product.
• To persuade non-users to try it once.
• To sell the new product.

Advertising :

“Any paid form of non-personal personal presentation and promotion of ideas, goods or
services by an identified sponsor.”
It is paid communication because the advertising appears. Advertising appears in
magazines, radio, TV, film and transit (car cards).
According to Russel and Veril “Advertising is a message paid for by an identified
sponsor and delivered through some medium of mass communication”

Classifications of Advertising :
They can be classified as :
(1)Audiences, (2) Types of Advertisers and (3) Media

Marketing Activities:

Sales:
• Making personal calls to concerned agents.
• Generating orders for products.
• Reporting on product movements or problems.
• Obtained special displays, features etc.
• Gaining new accounts.
• Checking of pricing, material and product availability in stores.

Publicity:

Publicity can be defined as the activity of “Securing editorial space, as divorced from
paid space, in all media which are read or heard by the company’s customers or
prospects, for the specific purpose of assisting in the meeting of sales goals. In other
words, publicity refers to an appeal made to a mass of people publicity in making goods,
“Publicity known”. It constitutes a mass approach. Publicity can also defined as the first
communication about the product and its detailed history through the media, radio and
so on before the actual manufacture and launching of the product to get the response of
the users or consumers. Usually Sugar Industry requires no advertising publicity.

Marketing Activities of Public Relation:

• Generation news, features about the business, its people and its products.
• Handing press inquiries and interviews.
• Preparing statement and releases.
• Helping counter in-favorable publicity.
• Preparing and distributing communications to special interested groups such as
stock-holders suppliers.
• Handling product and regularly public

Distribution Channels:

Distributional channels those systems of economic institutions through which a producer

of goods delivers them into the hands of their users. As society shifted from producing
things in the home to buying goods manufactured in centralized locations, there arose a
need for some means to distribute the products from the central points of production to
the dispersed populace. Channels of distribution furnish this bridge between the
producer and the consumer.

Tremendous amount of time and money would be expended in just acquiring the
minimum amount of goods one would need for survival. Marketing channels funnels the
goods demanded by the consumer to the place where he wishes to purchase them, and
create three basic utilities, viz.
1. Place
2. Ownership, and
3. Time
Marketing institutions must move the goods from point of production to the point of
purchase i.e. consumption. This creates place utility, because goods will have no value
to the buyer If they are still in hands of manufacturer Marketing channels arrange for the
transfer of title of the goods from the manufacturer to the buyer. This creates ownership
utility.
Marketing channels must have arranged goods available to the user when he wants
them, this creates time utility. In great part of US bathing suits gave little value to the
consumer in the month of January, in fact, the manufacturer Of swimming apparel must
make them during the winter because a substantial amount of lead time is necessary to
ensure that ample merchandise is on hand at that time is demanded. Channels of
distribution frequently absorb much of this difference in time between production and
consumption. This statement does not imply that all marketing activities do not have a
bearing on the creation of these utilities. Although advertising may stimulate ownership
utility by making a person want something, the actual ownership utility is created on the
transfer of title from the retailer to the individual The title does not always automatically
follow the actual trail of the merchandise.

Channel Originated Behavior:

It should not be assumed that marketing channels are passive institutions moving only
at the order of manufactures. Most aggressive middleman will institute the economic
behavior of their own when they see a need for it market place. Many retailers and
wholesalers have originated their own brands with which they compete in the market
place side by side.
Often in conflict with the promotional program of the manufacturers with whom
middleman deal they originate promotions of their own. A food manufacturer have a
certain promotion under way which requires a man floor display in super market, but the
super market owner may have promotional plan of this own that do not provide for such
display. In fact middlemen have learned through their bitter experiences of business that
the interests of the manufacturer are not always identical with theirs. Often middlemen
modify a manufacturer product in an attempt to make it more appealing to the
consumer. Ready-to-wear stores will frequently change the labels and alter some of
accessories of the apparel they sell. Intact, middlemen are influential in determining the
actual location at which the merchandise will be delivered to the customers. Although
manufacturers have some degree of control over location through their selection of
outlets but in fact, it is the dealer who will make the final decision concerning where the
merchandise should be sold to customer.

Channel Arrangement:
Four major alternative channel arrangement have been described below which differ
significantly in their capability for creating sales, in their costs of operation and their
susceptibility to control. Once they are choose, the firm must adhere to them for a
substantial period of time.

• The first channel consist of direct sales of goods by producer to ultimate

• The seconds marketing channel shows one selling intermediates between the
producer and the ultimate consumer. If the middlemen is retailer, his function is
to purchase the producer’s goods and resale them at a profit. They deal with
many producers. P-R-C
• The third marketing channel shows two different selling intermediaries. The most
common example consists of wholesaler and retailer. This is known as the
linkage. P-W-R-C
• The last channel consists of three selling intermediaries where a jobber usually
intervenes between the wholesalers and the retailers. The linkage is P-W-J-R-C.
The jobber buys from wholesalers and sells to small retailers, who generally are
 not serviced by the large wholesalers P = PRODUCER, W=WHOLESALER,
J=JOBBER, R=RETAILER, C=CUSTOMER

Sales promotion is a tool used to achieve most of the five major promotional objectives
discussed in the Promotion Decisions tutorial:

Building Product Awareness – Several sales promotion techniques are highly effective
in exposing customers to products for the first time and can serve as key promotional
components in the early stages of new product introduction.
Additionally, as part of the effort to build product awareness, several sales promotion
techniques possess the added advantage of capturing customer information at the time
of exposure to the promotion.

In this way sales promotion can act as an effective customer information gathering tool
(i.e., sales lead generation), which can then be used as part of follow-up marketing
efforts.
Creating Interest – Marketers find that sales promotions are very effective in creating
interest in a product. In fact, creating interest is often considered the most important use
of sales promotion. In the retail industry an appealing sales promotions can significantly
increase customer traffic to retail outlets. Internet marketers can use similar approaches
to bolster the number of website visitors. Another important way to create interest is to
move customers to experience a product. Several sales promotion techniques offer the
opportunity for customers to try products for free or at low cost. Providing Information –
Generally sales promotion techniques are designed to move customers to some action
and are rarely simply informational in nature. However, some sales promotions do offer
customers access to product information. For instance, a promotion may allow
customers to try a fee-based online service for free for several days. This free access
may include receiving product information via email.
Stimulating Demand – Next to building initial product awareness, the most important
use of sales promotion is to build demand by convincing customers to make a
purchase. Special promotions, especially those that lower the cost of ownership to the
customer (e.g., price reduction), can be employed to stimulate sales.

Reinforcing the Brand – Once customers have made a purchase sales promotion can
be used to both encourage additional purchasing and also as a reward for purchase
loyalty.
Promotional Strategy

1. Deciding Promotional Mix

Personal selling, advertisement and sales promotion are some of the promotional
methods. During most of the situations two or more promotional methods are to be used
for each campaign. Generally with the help of a single method it is not possible to
succeed. Advertising needs the support of personal selling or display to increase the
sales. Sometimes even the personal selling alone cannot be successful without the
support of advertisement. An ideal promotion mix is that situation where the total
expenditure incurred for various promotion methods is minimum and sales by such mix
is maximum.
Promotion mix means finding out the proper ratio of usage of different methods of
promotion. The management must find out, how much amount should be spent on each
promotional activity. Promotional mix is influenced by the following factors.

(a) Nature of the product

Nature of the product will be decide the promotional mix. For consumer goods
advertisement and dealer display will have more effect. Industrial goods with high
technology will need much of personal selling and cosmetics, blades etc, will require
more of advertisement than personal selling and display

(b) Nature of the Customer

If the communications are mostly to middlemen, then personal selling will be more
effective and very little spending on advertisement will do. If information are to be
passed to consumers and when the number of consumers is large, it is better to
advertise. Especially if customers are scattered, then advertisement alone can be
successful.

(c) Nature of the Market

If market for a product is only local then personal selling alone will be sufficient.
The Marketing MIX: Ingredients for Success

The marketing mix, earlier known as the 4 P’s,(but now has a few more),is a vital part of
any marketing strategy. This is a tool whereby the marketer takes decisions on what
and how a product should be, where it can be sold, how it should be priced, how it will
be promoted, how to equip the people who are responsible for selling the product…and
so on. Getting the marketing mix right is equally important for the large corporation and
the small business owner. One of the most critical marketing management decisions is
that decision of setting the marketing mix values, and selecting and employing strategy
that periodically change that marketing mixes in response to changing business
environment.

Product
1. No.1 selling product in its segment.
2. Good quality raw material is used to maintain the quality standards.
3. Consistency of product quality is high.
4. Always tastes fresh due to good quality and well developed distribution network.

Place-
1. It is available in many states.
2. Company location
3. Transportation facility
4. Availability of raw material
Price-

Pricing strategy should be of such type, that it gives a strong competition to the existing
leader in the market. Pricing should be favorable for the consumer. Pricing plays an
important role in promoting a new product in the market. In the initial stage price should
be low and as the product gains reputation in the market the price should be hike a little.
Pricing always should attract the customer and customer should never feel cheated by
the price, customer should feel happy for the price he have paid fro the product.

Promotion

Promotion includes advertising and other forms of sales presentations, designed to

encourage fast consumer or trade up-take of a product or service. The form of any
promotion depends on the product, the marketing plan and its objectives, and on the
imagination of the product management team. It can vary from a simple in-store
demonstration, or sampling, or a tie-in with on premises. A range of promotional tools,
techniques and activities are mixed and matched to meet the needs of individual
marketing campaigns.

Major Tools in Marketing LIQUOR

Publications: Companies rely extensively on published materials to reach and

influence target markets, including annual reports, brochures, articles, printed and on-
line newsletters and magazines, and audiovisual materials.

Events: Companies can draw attention to new products or other company activities by
arranging special events like news conferences, on-line chats, contests and
competitions, and sport and cultural sponsorships that will reach the target publics.

News: One of the major tasks of PR professionals is to find or create favorable news
about the company, its products, and its people. The next step is getting the media to
accept press releases and attend press conferences.

Websites: Website is a major tool of advertising as it is free from any kind of

restriction in posting ads and any type of content. A company can post its ad in any
website for promotion. A massive group uses internet and by posting ads on website
company can easily communicate with the customer and can promote a new brand.

On premise advertising: On premise advertising is also a good mode of

promoting a brand, as all the customers purchase liquor from the retail outlet only, so
company can post there hoardings and banners in the retail outlets.
Factors Influencing Company Marketing Strategy
There are various forms of marketing which are used for promoting the product in
market.

Marketing Activities

Brand Advertising
Promotional Activities in on & off trade
Experiential marketing
Consumer planning
Relationship marketing
Consumer PR
Brand Website & online activities
Packaging

Relationship between PLC & Marketing Strategies

Product life cycle management is the succession of strategies used by management

and as a product goes through its product life cycle. The conditions in which a product is
sold changes over time and must be managed as it moves through its succession of
stages.

The product life cycle goes through multiple phases, involves many professional
disciplines, and requires many skills, tools and processes. Product life cycle (PLC) has
to do with the life of a product in the market with respect to business/commercial costs
and sales measures; whereas product life cycle management (PLM) has more to do
with managing descriptions and properties of a product through its development and
useful life, mainly from a business/engineering point of view. To say that a product has
a life cycle is to assert four things:

• that products have a limited life,

• product sales pass through distinct stages, each posing different challenges,
opportunities, and problems to the seller,
• profits rise and fall at different stages of product life cycle, and
• products require different marketing, financial, manufacturing, purchasing, and
human resource strategies in each life cycle stage.

Like human beings, products also have life cycles. That is, they're born, and then over
time—their sales grow, mature, and finally decline. The strategies with which you
market a product need to change with each of these life-cycle phases. The table below
shows a few examples of how this might work:
PLC STAGE CHARACTERSTICS MARKETING OBJECTIVE MARKET STRATEGIES
PRODUCT INTRODUCTION Low sales, high cost per Create product Offer a basic product,
customer, no profits, few awareness and trial Use heavy promotions
competitors to entice trial
Product Rising sales and profits, more Maximize market Offer product
Growth and more competitors share Extensions
Product Peaking sales and profits, Maximize profit while Diversify brands
Maturity stable defending market Intensify promotion to
or declining number of share encourage switching to
competitors new brands
Product Declining sales, profits, and Reduce expenditure Phase out weak
Decline number of competitors and "milk" the brand Products,
Cut price;
Reduce promotion

Request for Deviation

In the process of building a product following defined procedure, an RFD is a request for
authorization, granted prior to the manufacture of an item, to depart from a particular
performance or design requirement of a specification, drawing or other document, for a
specific number of units or a specific period of time.

Market Identification

A "micro-market" can be used to describe a Walkman, more portable, as well as

individually and privately recordable; and then Compact Discs ("CDs") brought
increased capacity and CD-R offered individual private recording...and so the process
goes. The below section on the "technology lifecycle" is a most appropriate concept in
this context

In short, termination is not always the end of the cycle; it can be the end of a micro-
entrant within the grander scope of a macro-environment. The auto industry, fast-food
industry, petro-chemical industry, are just a few that demonstrate a macro-environment
that overall has not terminated even while micro-entrants over time have come and
gone.

Lessons of the product life cycle (PLC)

It is claimed that every product has a life period, It is launched, it grows, and at some
point, may die. A fair comment is that - at least in the short term - not all products or
services die. Jeans may die, but clothes probably will not. Legal services or medical
services may die, but depending on the social and political climate, probably will not.

Even though its validity is questionable, it can offer a useful 'model' for managers to
keep at the back of their mind. Indeed, if their products are in the introductory or growth
phases, or in that of decline, it perhaps should be at the front of their mind; for the
predominant features of these phases may be those revolving around such life and
death. Between these two extremes, it is salutary for them to have that vision of
mortality in front of them.

However, the most important aspect of product life-cycles is that, even under normal
conditions, to all practical intents and purposes they often do not exist (hence, there
needs to be more emphasis on model/reality mappings). In most markets the majority of
the major brands have held their position for at least two decades. The dominant
product life-cycle, that of the brand leaders which almost monopolize many markets, is
therefore one of continuity.

In the criticism of the product life cycle, Dhalla & Yuspeh state:

Clearly, the PLC is a dependent variable which is determined by market actions; it is not
an independent variable to which companies should adapt their marketing programs.
Marketing management itself can alter the shape and duration of a brand's life cycle.

Thus, the life cycle may be useful as a description, but not as a predictor; and usually
should be firmly under the control of the marketer. The important point is that in many
markets the product or brand life cycle is significantly longer than the planning cycle of
the organizations involved. Thus, it offers little practical value for most marketers. Even
if the PLC (and the related PLM support) exists for them, their plans will be based just
upon that piece of the curve where they currently reside (most probably in the 'mature'
stage); and their view of that part of it will almost certainly be 'linear' (and limited), and
will not encompass the whole range from growth to decline.
Limitations

The PLC model is of some degree of usefulness to marketing managers, in that it is

based on factual assumptions. Nevertheless, it is difficult for marketing management to
gauge accurately where a product is on its PLC graph. A rise in sales per se is not
necessarily evidence of growth. A fall in sales per se does not typify decline.
Furthermore, some products do not (and to date, at the least, have not) experienced a
decline. Coca Cola and Pepsi are examples of two products that have existed for many
decades, but are still popular products all over the world. Both modes of cola have been
in maturity for some years.

Another factor is that differing products would possess different PLC "shapes". A fad
product would hold a steep sloped growth stage, a short maturity stage, and a steep
sloped decline stage. A product such as Coca Cola and Pepsi would experience growth,
but also a constant level of sales over a number of decades. It can probably be said that
a given product (or products collectively within an industry) may hold a unique PLC
shape, and the typical PLC model can only be used as a rough guide for marketing
management. This is why it’s called the product life cycle.
RECOMMENDATION

From the survey of retailer and wholesaler it is clear that not only brand positioning,
brand image and consumer demands are the not only controlling factors of the sale of
product of the company but the wholesaler and the retailer also play a major role.
SIMBHAOLI should thus focus on the following points.

AVAILABILITY

It is necessary for the company to maintain a regular supply of its products and brands,
They should fulfill the demand of the wholesaler so that product can be available in the
retail market. The consumer should get the brand he demands otherwise he shifts to
other brands and frequent shifting affect the sales of company and the consumer could
even change the preference of his brand.

PROFITABILITY

As we have seen form the wholesalers and retailers view that they sell those products
which earn them greater profit margins. Therefore the company should give the
wholesaler greater profit. Margins so that has more profit and in turn retailer also gets a
greater profit margin.

EXTRA BENEFITS

Since there are many firms operate in the market it is essential for the company to give
extra benefits and gift to the wholesaler and salesman at retail outlets to maintain good
relation with them. The company can offer them free gift like playing cards, Key-Rings,
Wine, glasses and T-Shrits. In return the salesman at the retail outlet creates the
demand of the company’s brand. The company should send its marketing team into the
market regularly so that the performance of the company’s different brands could be
studies and a follow through action plan be developed. This will also help the company
to maintain good relation with Beer & Hotels and the wholesalers and retailers.

Steps undertaken in launching new brand

• Detailed analysis of market conditions

• Brand sales analysis and interpretation
• Category analysis and development
• Distribution objectives and sales targets
• Competitive review and analysis
 • Pricing efficiencies and options
• Advertising and promotion strategies
• Product packaging examination
• Recommendation and action plan

QUESTIONNAIRE FOR CONSUMER

Ques.1- Do you drink liquor?

a) Yes b) No

Ques. 2- You take liquor in form of...

a) Beer b) Whisky c) Rum

Ques. 3- Your age is………

a) 15-25 yrs. b) 25-35yrs.

c) 35-45yrs. d) 45 & above

Ques. 4- Who introduced you to drink Whisky?

a) friends b) Advertising

Ques. 5- You consume Whisky…….

a) Once a week b) 3-4 times in a week

c) Every day d) occasionally

Ques. 6- How often do you drink Whisky?

a) Occasionally b) Regularly

Ques. 7- Which type of Whisky do you prefer?

a) Cheap b) Semi premium c) Deluxe d) Scotch

Ques. 8- How much quantity of Whisky is consumed by you at one time?

a) 1 quarter b) 2 quarter c) 90ml d) 60ml

Ques. 9- You drink usually at?

a) Home b) Restaurant c) Bar d) Open space

Ques. 10- What are the key factors that affect your purchasing decision?

a) Price b) Brand c) Taste d) Status

Ques. 11- How was it, as compared to other existing brands?

a) Good b) Poor c) Satisfactory d) Equivalent

Ques. 12- You feel after drink………

a) Relaxed b) Happy c) Tensed d) Angry

Ques. 13- Your preference for packaging?

a) Glass Bottle b) Plastic Bottle c) Tetra packing

Ques. 14- Are you brand loyal?

a) Loyal b) Switcher

Ques. 15- Any suggestions for SSL?

………………………………………………………………………
………………………………………………………………………
Personal information
Name-…………………………….
Address-...…………………………………………………………..
………………………………………………………………………
………………………………………………………………………
Gender-………………………………
Age-…………………………………..

This questionnaire has given an insight about the taste and preferences of the customer
ranging from high class to low working class. It helps me to understand the market size
of various whiskies and other alcoholic drink. I sincerely thank the entire person who
helps me by filling up the questionnaire. The conclusions of the questionnaire are as
follows
QUESTIONNAIRE FOR RETAILER

Ques.1- What different types of liquor are sold by you?

a) Beer b) Whisky c) Rum d) Other

Ques.2- Which type of Whisky is mostly demanded?

a) Regular b) Semi premium c) Deluxe

Ques.3- In semi premium range Whisky, what are the different brands available with
you?

a) Royal stag b) Mc Dowell No. 1 c) Directors special

d) Aristocrat e) Any other………………

Ques.4- Which brand of SSL is mostly demanded?

a) Hunter Rum b) Xing vodka c) Old tavern d) Any other.

Ques.5- How much quantity of SSL whisky is sold daily?

a) 10 Cases b) 10-20 Cases c) > 20 Cases

Ques.6- Do you agree with advertising program of Whisky?

a) Yes b) No

Ques.7-Are you satisfied with the distribution system of SSL?

a) Yes b) No

Ques.8- Do you think that sale can be increased by providing scheme to retailer and
consumers?

a) Yes b) No

Ques.9- Who is the biggest competitor of SSL in the market?

…………………………………………………………
Ques.10- Would you like to give some suggestions to SSL for improvement?
………………………………………………………………………
………………………………………………………………………

Personal information
Name-………………………………………..
Name of the shop-…………………………………………………….
…………………………………………………………………………
Address of retailing-…………………………………………………..
…………………………………………………………………………
The retailers have also give a helpful insight of the product and also help me to
adjudged the consumption pattern of the various product of alcohol. During the interview
of retailers and distributor I have made various facts and finding about the liquor and its
consumption.
BIBLIOGRAPHY:

TEXTBOOKS REFERRED
Marketing Management, 13th Edition Philip Kotler, Kevin Lane Keller Marketing
Research, 3rd Edition.
AMBROSIA

WEBSITES REFERRED
www.google.com
www.vikipedia.com
www.economicwatch.com
www.reportliker.com
www.amrutdistilleries.com
www.simbhaolisugars.com
www.segramsindia.com
www.radicokhaitan.com
www.mohanmeakin.com
www.scribd.com
www.usl.com