Tamil Nadu: Liquor Politics?

UB Group’s fortunes on a seesaw ride in Tamil Nadu

Liquor Sales See Rise, Dip With Change In Political Situation

TIMES NEWS NETWORK

Chennai: The fortunes of Vijay Mallya’s United Spirits Ltd (USL) has been fluctuating with the political situation in the state.
USL, which held 20% share of the state’s liquor trade until the AIADMK came to power in May 2011, found its share drop to 12.38% by December even as Midas Golden Distilleries, owned by close associates of Sasikalaa, saw rising sales. When the relationship between chief minister Jayalalithaa and her friend Sasikalaa turned sour, Midas Distilleries managing director Mohan was arrested on charges of cheating and sales to the state procurer of liquor tanked.

An indent issued by the state-run Tamil Nadu State Marketing Corporation (Tasmac) shows USL’s sales in December last hovered around nine lakh cases of Indian-made foreign liquor (IMFL), which was about 19% of total sales in the state. Tasmac has exclusive rights to sell liquor in the state and is the department responsible for purchase of stocks.
Midas, which enjoyed 7.2% market share during the DMK regime, more than doubled its market share to 16.62% after the AIADMK came to power, at the cost of USL. Between December 2011 and March this year, USL was a gainer.

However, in April, when the tide changed with Sasikalaa patching up with chief minister Jayalalithaa, Midas bagged orders for about six lakh cases. On the other hand, USL, which procured orders for about 9.90 lakh cases (about 20% of total sales) in March 2012, suffered subsequently with sales dipping to just 7.51 lakh cases (17.8%) in April 2012.

Ten distilleries and four breweries supply all of Tamil Nadu’s liquor requirements – about five crore cases annually. The state is among the top five liquor markets in the country, but entry licenses are hard to come by.

The AIADMK government has changed the managing director of Tasmac twice in the last five months. Sandeep Saxena was replaced by D Vivekanandan in May soon after the AIADMK came to power. He was replaced by Apoorva Verma in July, who soon made way for T Soundiah.
timeschennai@timesgroup.com