Tipplers in Tamil Nadu are spending more money on liquor since the retail sales of Indian Made Foreign Liquor (IMFL) was taken over by the state government in October 2003. |
The volume of IMFL sales in the state has increased to 14 lakh cases a month from an average of 11.5-12 lakh cases before the state-owned TASMAC took over the retail sale of IMFL. |
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Today, Tamil Nadu accounts for 19 per cent of the total IMFL sale in India, with Andhra Pradesh notching up the number one position with 18 lakh cases a month. |
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IMFL companies believe that the 20 per cent jump in the IMFL sales is due to three reasons. One, the sale at TASMAC outlets is at the fixed MRP price, while the private retailers used to sell with a margin of Rs 3 to Rs 5 on every 180 ml bottle. Two, the quality of the consumers' 'favourite' brand is above board. |
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At least that is what the IMFL manufacturers would like to believe. Three, there are 8,162 retail outlets controlled by TASMAC against 5,000-odd outlets under the private network that prevailed before retail sale was taken over by the state. |
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Trade, however, does not expect Tamil Nadu to overtake Andhra Pradesh. B S Ranganath, assistant vice-president of Radico Khaitan Limited, said: "The 'O' category in Andhra Pradesh accounts for almost 60-65 per cent of the total volume of IMFL sale in the state. In Tamil Nadu, this category accounts for only 35-40 per cent of the total volume." |
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The 'O' category consists of brands priced below Rs 235 per case. Ranaganath said that no brand is sold below Rs 340 a case in Tamil Nadu, which explains why the 'O' category takes a chunk of IMFL sales in Andhra Pradesh. |
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The surge in IMFL sales does not excite the premium brand owners. Balajirao Ch, deputy general manager of Shaw Wallace, said: "Our estimate is that the 1.91 lakh case surge in monthly sales is predominantly in the lower price categories." |
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These brands are priced between Rs 45 and Rs 54 per nip (180ml). This segment is dominated by the local brands such as Power, Superstar, Diamond and MGM. |
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While acknowledging the surge in sales, S Subramaniam, president of Empee Distilleries Limited, said: "The growth has not been restricted to low cost brands only. The mid-segments have benefited and here too the concentration is not with just to one or two companies. All the major IMFL companies have witnessed growth in Tamil Nadu." |
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The last few months have witnessed the entry of a large number of brands into Tamil Nadu across all categories of IMFL. Shaw Wallace, Radico Khaitan and Empee Distilleries are some of the national players that have launched their premium brands in the market in the past six months. |
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