The manufacturer of Khorta and Morosha vodka is losing its position in the market after a case was initiated against top management

The manufacturer of Khorta and Morosha vodka is losing its position in the market after a case was initiated against top management

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The large producer of Khorta and Morosha vodka, GC Traditions of Success, is losing its position in the market after the initiation of a criminal case against top management. In January-August 2023, the group reduced output by 40%, dropping to fifth place among manufacturers. Competitors expect Horta consumers to switch to other brands.

Traditions of Success Group of Companies (brands Khorta, Morosha, Pervak) according to the results of January-August 2023 dropped from fourth to fifth place among vodka producers in Russia, as follows from data available to Kommersant from market participants. The group’s vodka production during this period decreased by 40% year-on-year, to 2.67 million decaliters, shipments decreased by 37%, to 2.77 million decaliters. In August relative to July, the group’s factories reduced vodka production four times, to 66 thousand decaliters, and shipments decreased by 2.8 times, to 104 thousand decaliters.

The first place among vodka producers was retained by Tatspirtprom (Tundra, Russian Currency brands) with 5.76 million decaliters, second by Novabev Group (Beluga, Belenkaya) with 5.63 million decaliters, third by the Alcoholic Siberian Group (ASG ; “Five Lakes”, “White Birch”) with 4.35 million decaliters. The Rust Group of Companies (Russian Standard, Green Mark) moved up to fourth place, producing 3.23 million dal of vodka. Traditions of Success Group of Companies, Novabev Group and Rust Group of Companies did not provide comments.

The Traditions of Success Group of Companies includes the Russian North and Rodnik and K plants. Kommersant’s interlocutors in the market connected the enterprises with the Ukrainian holding Global Spirits (Khortytsia brand) of Evgeniy Chernyak, but the parties denied this. In April 2022, Alexander Bespalov became the owner of the factories. And in July 2023, it became known that a criminal case had been initiated against Evgeniy Chernyak on suspicion of financing the Armed Forces of Ukraine and charges of bribery had been brought against Alexander Bespalov and the general director of Rodnik and K. Andrei Lazutin (see Kommersant on July 4). The Traditions of Success Group of Companies then denied any connection with Evgeniy Chernyak and Global Spirits and participation in the financing of foreign military units.

A Kommersant source on the market says that the bottling and shipment of Khorta and Moroshi under the contract today is mainly carried out by the Yaroslavl Distillery and Vodka Factory (YALVZ). Federal Accreditation data confirms that YALVZ received declarations to produce vodka under these brands. But, Kommersant’s interlocutor notes, the plant’s capacity is much less than the previous sales volumes of brands. According to data from market participants available to Kommersant, in January-August YALVZ produced 680 thousand dal of vodka – 12% more than a year earlier. The Kaluga Distillery and Vodka Factory (KLVZ) “Crystal”, which also produces “Khorta”, increased its vodka production by 88% year-on-year in January-August, to 1.19 million decaliters. The owner of the Kristall plant, Pavel Pobedkin, says that the volume of orders exceeds the plant’s capabilities, and new offers arrive “literally every week.”

Meanwhile, some of the partners of Traditions of Success Group of Companies have complaints about the group’s structures. YALVZ, it follows from the file of cases, in September filed claims with the Arbitration Court of the Yaroslavl Region for the recovery of 38.8 million rubles. with Standard of Quality LLC and 25.28 million rubles. with Traditions of Success LLC. A Kommersant source in the market believes that we are talking about debts for contract production. With a claim for recovery of 41.9 million rubles. The bottle manufacturer Glanit also turned to Quality Standard, Rodnik and K and Russian North. YALVZ and Glanit did not answer Kommersant.

CIFRRA director Vadim Drobiz notes that most large vodka producers are showing good results given the high base of 2022, and by the end of 2023, sales of the drink may increase slightly. Director for development of the main portfolio of ASG Natalya Nevorotova expects a 4% increase in sales by the end of 2023 due to “White Birch”, “Husky”, Remeslo, Gurman and the strengthening of the position of “Five Lakes”, to which consumers of “Horta” and “ Moroshi.” “The brands are comparable in maturity, reputation, and were launched and developed at the same time,” she explains. Tatspirtprom notes an increase in Tundra shipments by 53% year-on-year, including due to the expansion of the range. As Ms. Nevorotova says, the capacity of the vodka market remains at the level of 2022, when the figure increased immediately by 6%, and 90% of sales come from brands with a price of about 300 rubles. per bottle.

Anatoly Kostyrev

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