Sula Vineyards Soars 4% on Strong Q2FY24 Sales

Sula Vineyards Soars 4% on Strong Q2FY24 Sales

VoM News Desk | October 12, 2023 | 12:53 PM IST | Breaking News | Follow on Google News

Sula Vineyards Soars 4% on Strong Q2FY24 Sales

Sula Vineyards Soars 4% on Strong Q2FY24 Sales

In early trading on Thursday, Sula Vineyards, India’s largest wine producer, witnessed a remarkable uptick in its stock price, surging by approximately 4% to reach ₹485 per share. This surge was in direct response to the company’s robust Q2FY24 sales update.

In an exchange filing made on Wednesday, Sula Vineyards reported substantial revenue growth from its own brands, estimated at 14% year-on-year (YoY), reaching ₹116.2 crore. Additionally, the company posted a notable YoY increase in revenue from its wine tourism business, amounting to ₹12.1 crore, marking a surge of 26%. For the first half of FY24 (H1FY24), the company achieved a 22% YoY surge in revenue from its own brands, reaching ₹209.3 crore, and a 19% YoY improvement in revenue from wine tourism, totaling ₹23.3 crore.

Expansion and Positive Momentum

During the quarter, Sula Vineyards expanded its iconic Nasik Winery Tasting Room, aligning with the continuous increase in visitor numbers. Commenting on the Q2 trading update, Sula CEO Rajeev Samant expressed his satisfaction with the double-digit growth achieved in both their Own Brands and Wine Tourism businesses. The company’s focus on premiumization proved fruitful, with their Elite and Premium wines leading the way, registering an 18% YoY growth in Q2 and 24% YoY growth in H1. This is particularly significant in light of the slowdown in discretionary spending in the overall economy during Q2.

Rajeev also announced the launch of Sula’s first Pinot Noir from The Source range, their fastest-growing premium wine brand, now available in Maharashtra and set to be introduced in other key markets in FY25. He further highlighted the remarkable performance of their world-renowned wine tourism business, which grew by 26% in Q2. There was a remarkable 43% surge in tastings, with over 49,000 recorded in the quarter over Q2 FY23. The future appears promising as they recorded their highest-ever footfall on October 1, 2023, with a record 38,501 wine enthusiasts passing through their gates.

A Growing Success Story

Sula Vineyards engages in the manufacture, purchase, and sale of premium wine and other alcoholic beverages. Their shares were listed on the exchanges in December 2022 at ₹331.2 apiece, 7.2% lower than the issue price of ₹357. However, the stock rapidly rebounded the following month, registering a 14% gain and continuing its winning streak for the next seven months, eventually reaching a new all-time high of ₹535 per share. At present, the stock is trading 36% higher than its IPO price.

In August, domestic brokerage firm Hem Securities initiated coverage on the stock with a buy recommendation, setting a target price of ₹587 per share. Sula Vineyards aims to leverage the potential of the under-penetrated wine industry in India by offering the widest product range in the Indian wine market, a significant step as wine consumption in India represented less than 1% of alcohol consumption in CY21.

VoM News Desk

VoM News is an online web portal in jammu Kashmir offers regional, National & global news.