 "Roshini Sanah Jaiswal")
Most people don't give Roshini Sanah Jaiswal much of a chance. The company she wants to turn around, Jagatjit Industries, is in decline: volumes are down, and losses are up, while its flagship brand, Aristocrat, has no zing left in it - youngsters see it as the whiskey imbibed by their fathers at home. Investors have lost interest in the stock: its market cap of less than Rs 200 crore is less than half of what Kumarmangalam Birla recently paid for a house in south Mumbai.
Jaiswal, the granddaughter of the company's founder, Ladli Prasad Jaiswal, and daughter of Karamjit Jaiswal, joined the company in November as its chief restructuring officer and hopes to end the current year with an operational profit. Jaiswal claims that she has, in the last few months, fixed accountability among employees, downsized the corporate office, linked salaries to performance, fixed targets and plugged gaps in human resources.
She has shut down a loss-making bottle-making factory, ended at least one franchise in order to get a better grip on quality, signed on Kalki Kochelin as brand ambassador for Ice vodka (Sunny Leone endorses AC Black) and introduced variants like Kinky Chilly (her plain vodka is called Bare It All after Naked was disallowed by the authorities), redesigned some bottles and packages with help from Sedley Place of England, hired a new master blender from Scotland, and decided to set up a bottling unit in Assam to feed the large northeast market better.
She is on the lookout for brands to partner, or even acquire, in the rum and brandy segments. The corporate grapevine has it that she could be working on some kind of a marketing alliance with Tilaknagar Industries that owns the popular Mansion House Brandy and is in talks with Kishore Chhabria to induct him as a sizeable shareholder.
To bankroll her plans, Jaiswal is negotiating with private equity funds to sell some equity. The family owns 75 per cent of Jagatjit Industries, which gives her enough headroom to get a partner. (The family is fairly conservative: none of its shares are pledged and it hasn't given any personal guarantee.)
It is an interesting and challenging time to be in the liquor business. Consumers are going premium - rapidly. People drink less for a kick and more to make a lifestyle statement. This has aroused the interest of global giants like Diageo and Pernod Ricard.
At the same time, the Vijay Mallya affair has given the industry a bad name. Each state has its own liquor policy, which makes the industry a regulatory nightmare. In many states, there is a full-fledged distribution mafia in place. Advertising is banned, so brands have to make do with surrogates. Says Jaiswal: "Thanks to Mallya, people think liquor is glamorous and highly profitable - it is not."
Small liquor companies, which do not have enough financial muscle, face an uncertain future. Many in the business believe Jagatjit Industries is one of them. Jaiswal wants to save it from that fate.
It wasn't meant to be like this. Much before Independence, Ladli Prasad Jaiswal was jettisoned from the distillery in Karnal that he ran with his brother. When his father-in-law, the Divan of Kapurthala, recounted his travails to his employer, Jagatjit Singh, the ruler granted Jaiswal 300 acres at a small place called Hamira on the road to Amritsar. Jaiswal put up a distillery there and named it after the king: Jagatjit Industries. Aristocrat came in the late 1960s.
Success followed. Ladli Prasad Jaiswal became a part of Delhi's upper crust. When Bhai Mohan Singh took the baraat of his eldest son, Parvinder Singh, to Beas in Punjab, Ladli Prasad Jaiswal arranged the food on the way. In later years, he relocated to London. A business partner who would meet him every quarter recounts that Ladli Prasad Jaiswal lived in great style there: he had a serviced apartment at Grosvenor House, a small army of servants and at least one Rolls Royce. And, from London, he would call every day at 9:30 am (India time) to keep tabs on his company.
In the early 1990s, Jagatjit Industries formed a 50/50 venture with Hiram Walker but it ended in a few years. This was followed by a similar partnership with Brown-Forman but that too met with the same fate. It appears that both the overseas companies had offered to buy out Jagatjit Industries, but Ladli Prasad Jaiswal quoted a price that was more than double of what they were ready to pay.
In later years, Bacardi had initiated similar talks but in vain. "When we had initiated discussions, India was the flavour of the season. By the time he got back with a price, the enthusiasm had begun to wane," says one person who was involved in these negotiations.
These failed partnerships were attempts by Jagatjit Industries to go premium. At the end, it was left with Aristocrat, with its many variants including ACP Neat and ACP Sexy, which catered to the mass market. The upscale segment remained out of its reach. Somewhere, the company lost momentum. Peers say that it totally vanished from the various industry forums. Its volumes slid from 12 million cases in 2011 to 8.5 million last year.
Jaiswal, after studying at Modern School in Delhi, was sent to Badminton School in Bristol (it was founded in 1858) because "Indira Gandhi had studied there". Later, she went to New York University for her undergraduate course.
Her first venture was a lounge bar called 180 Proof in Bengaluru. Builder Jitendra Virwani owned a heritage building on MG Road which he offered to Jaiswal. She spent Rs 1.5 crore to do up the place.
The only hitch was that it was sandwiched between the Book Society and Bible Society. The night her lounge was to open, candle marches were held in protest. She pressed on. On nights, she manned the gates. On some nights, she took position behind the bar. And one night, when the police came to pick up the staff for working into the curfew hours, she insisted they take her along.
Bars, lounges and pubs are a tough business. One has to deal with the authorities, musclemen, police and drunks. "Thank God it was in gentle Bengaluru," says Jaiswal . "I shudder to think what would have happened in Delhi." But Delhi is where she moved next, where she, along with her husband Jay Singh, set up the F Bar.
Many more such ventures followed for JSM Corporation, set up by Jaiswal, Singh and Sanjay Mahtani, including the Hard Rock Cafe. Subsequently, Azim Premji invested $25 million in it for a 22.5 per cent stake.
Jaiswal says she is still invested in the venture, though the JSM Corp website contains no reference to her. This, she says, has happened because she has separated from her husband, though she continues to serve on the board of directors.
Strangely enough, Jaiswal and no member of the family are on the board of Jagatjit Industries. Jaiswal was inducted as an additional director for a month or so last year. She says the issue will be fixed in the next two years.
At the moment, her priority is to get a full portfolio of products and brands at premium prices. Her company has taken some steps in that direction. Thus, it has come out with Royal Pride blended (Scotch with Indian) whiskey, King Henry VIII Scotch whiskey and Clan Sinclair Single Malt. While King Henry VIII is bottled in India, Clan Sinclair is bottled in Scotland. Jaiswal has also decided to make AC Black from grain instead of molasses in order to give it a premium spin.
But all of this is yet to improve her market share. At one of our meetings in Three-sixty Degree at The Oberoi, I ask if the bar at the popular restaurant stocks her brands. "No," Jaiswal replies, without even bothering to check.
She has her task cut out. She can only hope Leone and Kochelin create enough buzz for her in the market.
