Sula Vineyards reported a 3% year-on-year revenue increase to ₹121 crore for the quarter ended June 30, 2026, continuing the positive momentum from the previous quarter. The growth was primarily driven by a 6% expansion in its Elite & Premium portfolio and double-digit gains in its Wine Tourism segment, which saw revenues rise 12% to ₹15.5 crore. Despite the top-line growth, gross profit contracted by 5% compared to the same period last year.

The decline in gross profit was attributed to two main factors. First, a shift in procurement mix towards wine grapes, which accounted for nearly 100% of total grapes procured in harvest 2026 compared to 80% in previous years, impacted margins by approximately 150 basis points. Second, an adverse geographical mix, with stronger sales in lower-margin markets like Telangana and Haryana relative to core markets, reduced gross margin by another 200 basis points. Management noted that these higher costs are temporary and expected to normalize from Q4 FY27 onwards as the grape mix rebalances.

Operational Highlights

The company’s Own Brands business grew by 2%, led by the Elite & Premium portfolio, which now constitutes 78% of Own Brands sales, up 310 basis points from the prior year. Flagship brands The Source and RASA delivered double-digit growth, accounting for an all-time high of 16% of Own Brands sales. In contrast, the Economy & Popular portfolio faced pressure due to competitive discounting.

Wine Tourism emerged as a key growth driver, contributing approximately 13% to overall revenue. Growth in this segment was fueled by a 21% increase in room revenues following the launch of the third resort, The Haven, and higher spend per guest. Resort occupancy stood at around 63%, excluding The Haven, it was over 70%.

Financial Performance

Operating expenses declined by 3% year-on-year, aided by a 6% reduction in employee benefit expenses and lower ESOP costs. This cost optimization helped partially offset the impact on EBITDA. Depreciation increased by 12% due to new assets including The Haven resort, while interest costs fell by 4% driven by lower average debt levels.

Net debt stood at ₹319 crore as on June 26, 2026, down from ₹345 crore a year earlier. Management expects net debt levels to continue trending lower through FY27. Working capital signals showed WIPS receivables at ₹88 crore as on June 26, reducing to approximately ₹80 crore after a ₹10 crore payout in July.

What the Numbers Show

The divergence between revenue growth and gross profit contraction highlights a significant margin compression event. While revenue grew 3%, gross profit fell 5%, indicating that the 350 basis point combined impact of raw material mix and geographical sales distribution severely eroded profitability. This suggests that current volume growth is not yet translating into proportional earnings power, making the upcoming normalization of grape costs in Q4 FY27 critical for margin recovery.

Looking ahead, management indicated that table grape prices are likely to decrease meaningfully from the spike seen in harvest 2026, where prices reached ₹35 per kilo compared to the typical ₹15-16 per kilo. This normalization is expected to benefit the Popular & Economy portfolio margins starting FY28. Additionally, preliminary approval for five additional brand listings in the CSD channel is expected to drive further growth, with CSD currently contributing around 4% of FY26 revenues.

Sula Vineyards Limited has released its unaudited financial results for the quarter ended June 30, 2026. The company conducted an earnings call on August 7, 2026, to provide details on its operational performance and financial standing for the period. This disclosure ensures transparency for shareholders and stakeholders regarding the company's recent business activities.

The announcement was made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Sula Vineyards submitted the notice to both the National Stock Exchange of India Limited (NSE) and BSE Limited. The filing confirms that the audio recording of the earnings call is accessible to the public via the company’s official investor relations portal.

Key Disclosures

The primary focus of the communication was the availability of the earnings call transcript and audio recording. Investors are directed to the company’s website at https://sulavineyards.com/investor-relations.php to access the full discussion. No specific financial metrics such as revenue, net profit, or EBITDA were included in this specific filing notice; rather, it serves as a regulatory compliance document directing users to the detailed discussion.

Regulatory Compliance

Gayathri Iyer, Company Secretary and Compliance Officer, signed the disclosure. Her membership number is A38069. The notice was addressed to the Listing Department of the NSE in Mumbai and the Corporate Relationship Department of BSE Limited. The company’s ISIN is INE142Q01026, with NSE symbol SULA and BSE Scrip Code 543711.

Sula Vineyards Limited, formerly known as Sula Vineyards Private Limited, maintains its registered office in Mumbai and its winery operations in Nashik, Maharashtra. The company continues to adhere to strict listing obligations to ensure timely dissemination of material information to the market.