The Hindu Business Line : Empee to make second foray into brewery biz

Chennai, May 4 Empee Distilleries Ltd plans to enter the brewery business for which it is in discussions with international brands, according to Mr Shaji Purushothaman, Managing Director, Empee Distilleries Ltd. For the company, this will be a second foray into the brewery business, which it exited a few years back.

According to Mr Shaji, the company is currently in talks with leading international brands for a joint venture, which is likely to be finalised in a month or two. Empee has applied for licences to set up breweries in Tamil Nadu and Andhra Pradesh.

It may be recalled that Marco Polo, Empee’s brand, was among the market leaders in beer, he said. The company had exited the business because it could not achieve a big enough market size — the brewery business is the preserve of big players. Empee is this time looking at a capacity of over 5-lakh cases a month at each of the plants (This capacity is twice what Empee had in 2002 when the UB group acquired the entire stake in the brewery business).

IMFL expansion

Mr Shaji said that the company is on schedule to completing the expansion of its Indian Made Foreign Liquor (IMFL) and bottling plants and hopes to launch new brands and revamp existing ones in this segment. Empee will enter the medium segment, a new niche for the company which has a strong presence in the premium and regular segments in IMFL. It will launch flavoured vodka in the medium segment.

Empee also has in the pipeline 3-4 new brands including Empee’s Premium Whisky which is to be launched in Tamil Nadu and Karnataka in a couple of months. Existing brands are also to be revamped with a new look and packaging, he said.

On the expansion plans, for which the company came out with a public issue last November, he said that Empee’s IMFL plant in Tamil Nadu is working to full capacity of 3.19 lakh cases a month. The expansion programme that will add an additional 1.81 lakh cases taking its capacity to 5-lakh cases a month will be in place by June-July, he said.

Alcohol output

In line with its IMFL expansion, the company is also expanding its alcohol output. The existing distillery is being expanded to 70 kilolitres per day (klpd) from the present 20 klpd.

The 60 klpd grain based alcohol plant coming up at Nellore is expected to start production in 2009. The facility can also handle molasses as a raw material. This facility will give the company a strong market access in Andhra Pradesh and Karnataka — strong whisky markets, he said.

Empee Distilleries is a part of the Empee Group, which also has interests in sugar and hotels.