USL licenses economy brands to local bottlers
United Spirits (USL) has started licensing out economy brands such as Bagpiper whisky and Celebration rum to regional bottlers in return for annual royalty payments, according to media reports.
The reports said USL is offering the big volume brands on a five-year, extendable contract beginning with markets where profitability is under strain, they added.
USL has struck deals with local bottling chieftains like Tilak Raj Sharma for Rajasthan and Chhattisgarh, Ponty Chadha family in Uttar Pradesh, K P Kedia family in Madhya Pradesh and Magunta Srinivasulu Reddy of Balaji Distilleries in Goa, Andhra Pradesh and Kerala. The brand spin-offs will lead to USL reducing the contracted production footprint, as the company looks to protect profit margins in an industry under siege from tightening regulations and trade restrictions.
