Shares of Sula Vineyards Ltd surged over 10% on Tuesday to trade at ₹328.45, marking one of the sharpest intraday gains among liquor-linked counters. The rally comes in stark contrast to the broader spirits sector, where stocks like United Spirits and Radico Khaitan declined following Maharashtra’s cabinet decision to hike excise duties on Indian Made Foreign Liquor (IMFL) and country liquor.
So why is Sula soaring?
Market participants attribute the rally to one key detail: wine has been excluded from the excise duty hike. While IMFL and country liquor will now face significantly higher taxes — with IMFL excise duty rising from 3x to 4.5x of manufacturing cost — wine was not mentioned in the updated tax structure. That omission has sent a strong signal to investors that wine, as a segment, may escape near-term pricing pressure.
Maharashtra is India’s largest wine-producing state and also a key market for Sula. The exclusion suggests a possible continuation of state-level support to the sector, especially given its linkages with agriculture, tourism, and premium beverage consumption.
Sula shares have been underperforming for several months and are down nearly 40% from their all-time highs. Tuesday’s rally is also being viewed as a relief rebound with valuation support and fresh buying interest returning amid improving outlook for wine demand.
As of 9:48 AM, Sula Vineyards was trading at ₹328.45, up ₹31.45 or 10.59%, with a market cap of ₹27,720 crore.
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