Dec 23, 2011, 04.02 PM IST | Source: CNBC-TV18

See 20% growth in volumes this year: Tilaknagar Inds

In an interview to CNBC-TV18, Amit Dhanunkar, chairman and managing director of Tilaknagar Industries says, the volumes will grow around 20% this year.

See 20% growth in volumes this year: Tilaknagar Inds

In an interview to CNBC-TV18, Amit Dhanunkar, chairman and managing director of Tilaknagar Industries says, the volumes will grow around 20% this year.

He further says, The company would look at expanding its business. We have fairly strong, solid position in the South right now. We want to expand our business both in South and slowly and steadily build the national print also.

Below is the edited transcript of his interview with CNBC-TV18's Ekta Batra and Reema Tendulkar. Also watch the accompanying video.

Q: Tilaknagar Industries has won a legal battle to retain its flagship brand Mansion House Brandy after Bombay High Court dismissed a suit by Dutch spirits company UTO. Can you take us through the legal battle that you have won in the Bombay High Court? Is it just a dismissal of a case by a Dutch company or have you won a case?

A: The Dutch company had filed a suit against Tilaknagar Industries (TI) in 2009. Along with the suit, they had also moved a notice of motion seeking to restrain us from using the marks Mansion House Brandy in India, seeking an interim injunction against that. They were trying to injunct us from using these marks. It is that notice of motion that has been dismissed by the High Court yesterday. We await the official judgement copy.

Q: Any indication that you have got from the Dutch spirits company UTO? What they plan to do further? Are they planning to go to the higher authorities to contest this or is it a closed chapter now?

A: We do not have any such information at this point in time.

Q: With regards to this Dutch company, what was the point of contention exactly? Why did this emerge in the first place?

A: We had started a business relationship in 1983. This is about three decades ago. Around the year 1989 via understanding they had ceded these marks to Tilaknagar Industries. As far as we understand, the marks were ceded to us. Post ceding, we have adopted the marks rightfully by registering the marks in the year 1993.

Q: While this whole case was on and under litigation were you continuing to use the brand name or was there a halt in any of the business operations on account, till this judgement as passed?

A: We continue to use the marks. There was no effect on our operations. We have continued to grow the brand over the past four-five years. I think thats the second largest selling brandy in the world.

Q: Some time back in December, there was some news that you are contemplating a joint venture with European liquor company.  Can you take us through the developments on that front? What could we expect?

A: There are a lot of opportunities in terms of international collaboration and partnerships. The Indian Alco Bev (Alcoholic Beverage) has witnessed good growth over the past 10-12 years. It continues to be very attractive market space for a lot of international players. So, we are also in talks with a couple of players in terms of how best we can synergise and capitalise on this opportunity jointly. But there is nothing definitive at this point in time. It will be too premature to make any remark at this stage.

Q: Have you at least narrowed down on any European company. Will it only take place in FY13, nothing in the next few months?

A: Its difficult to comment at this stage.

Q: Will it only be any kind of equity arrangement or are you planning to perhaps invest more into the business?

A: We would look at expanding our business. We have fairly strong, solid position in the South right now. It emerges as leading brandy players in the south and of course we want to expand our business both in South and slowly and steadily build the national print also. So, we will be working in that direction in terms of strengthening our brands, our product portfolio, geographic reach and our manufacturing setup.

Q: How much are you planning to put money into the company to grow and expand?

A: I would not like to make any definitive remark on this at this stage. But we have already made investment of more than Rs 200 crore in our distillation set-up in our home state of Maharashtra where we have setup two distilleries. One is molasses based distillery with capacity of 50,000 liters per day and another grain distillery of a capacity of 100,000 liters per day. So, the total investment involved is to the tune of Rs 250 crore. This project was also classified as a mega project by the government of Maharashtra against which we will be availing a VAT subsidy in the next financial year.

Q: What you are doing in terms of volumes? How exactly input prices are affecting you in terms of margins as well?

A: In terms of volumes, we are fairly confident of closing the year with growth upwards of around 20%. The input costs have gone up in this year.

Tilaknagar Ind stock price

On April 21, 2014, Tilaknagar Industries closed at Rs 63.50, up Rs 0.35, or 0.55 percent. The 52-week high of the share was Rs 74.60 and the 52-week low was Rs 44.85.


The company's trailing 12-month (TTM) EPS was at Rs 4.76 per share as per the quarter ended December 2013. The stock's price-to-earnings (P/E) ratio was 13.34. The latest book value of the company is Rs 40.53 per share. At current value, the price-to-book value of the company is 1.57.

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