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Subject category: Marketing
Published by: IBS Research Center
Published in: 2009

Abstract

United Spirits Limited (USL) is the largest spirits manufacturer in India, and the world's number three. This Indian start-up has a strong domestic, as well as international presence. However, in the state of Tamil Nadu (a state in India), which accounts for 18% of its beer business, it does not have its own manufacturing unit, but has had a contract manufacturing unit, Balaji Distilleries for the last 25 years. BDL was declared unviable by BIFR (Board for Industrial and Financial Reconstruction) for posting losses consecutively for four years. In December 2008, as an expansion initiative, USL acquired BDL in Tamilnadu. It remains to be seen whether this acquisition would yield the envisaged synergies for USL. What will be the prospects and challenges of this backward integration move?
Location:
Industry:
Other setting(s):
2009

About

Abstract

United Spirits Limited (USL) is the largest spirits manufacturer in India, and the world's number three. This Indian start-up has a strong domestic, as well as international presence. However, in the state of Tamil Nadu (a state in India), which accounts for 18% of its beer business, it does not have its own manufacturing unit, but has had a contract manufacturing unit, Balaji Distilleries for the last 25 years. BDL was declared unviable by BIFR (Board for Industrial and Financial Reconstruction) for posting losses consecutively for four years. In December 2008, as an expansion initiative, USL acquired BDL in Tamilnadu. It remains to be seen whether this acquisition would yield the envisaged synergies for USL. What will be the prospects and challenges of this backward integration move?

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Location:
Industry:
Other setting(s):
2009

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