Globus Spirits’ Samalkha Production Halted for 23 Days Due to Flooding

Image Source: Dr. Vijay Malik

Globus Spirits Limited has reported a significant disruption in its manufacturing operations at the Samalkha unit in Haryana owing to severe flooding that impacted the facility for 23 days. This unexpected environmental challenge has temporarily affected the company’s production capacity, supply chains, and overall operational rhythm. Despite the disruption, the company is actively managing the situation with remedial measures to resume normal operations and mitigate any long-term impact on its business.

Key Highlights
- Flooding at Samalkha unit in Haryana caused a 23-day operational shutdown.
- The disruption affected production activities including IMFL (Indian Made Foreign Liquor) manufacturing, ethanol production, and other by-products.
- Samalkha facility has a significant capacity role in Globus Spirits’ overall manufacturing network with a production capacity of approximately 47.6 million liters annually.
- The company has initiated corrective steps to restore operations and minimize supply chain disruptions.
- Globus Spirits’ geographically diversified manufacturing footprint, including facilities in Rajasthan, West Bengal, Bihar, and Jharkhand, provides operational resilience.
- Despite flood-induced setbacks, Globus Spirits continues to witness strong demand for its products and maintains healthy relationships with key customers.
- The company expects to return to normal production levels in the near term as recovery efforts progress.

Impact of Flooding on Operations
The flooding, triggered by heavy rains and waterlogging in the Samalkha region, inundated the factory premises and disrupted critical production lines. The affected operations primarily include the production of IMFL brands, ethanol used for blending and industrial purposes, and associated by-products that contribute significantly to Globus Spirits’ revenue.

This disruption temporarily halted manufacturing, delayed product dispatches, and led to under-utilization of the Samalkha plant capacity. The company communicated the situation promptly to stakeholders and is prioritizing workforce safety alongside operational restoration.

Strategic Measures and Recovery Plans
Globus Spirits has mobilized resources for rapid damage assessment, equipment maintenance, and infrastructure repairs to expedite the restart of production. Contingency planning involves optimizing output from other distilleries to partially offset the shortfall and maintaining supply commitments.

The company’s strategy of maintaining multiple state-of-the-art manufacturing units across India has proven beneficial in cushioning the impact of such natural calamities. Plants in Behror (Rajasthan), Panagarh (West Bengal), Hajipur (Bihar), and Baharagora (Jharkhand) allow for operational flexibility and volume supplementation.

Industry and Market Context
The Indian spirits industry has faced multiple challenges recently including regulatory changes, excise duty hikes, and environmental disruptions like floods and COVID-19 related lockdowns. Globus Spirits’ ability to navigate these obstacles while sustaining financial and operational performance reflects its robust risk management and diversified operational model.

The government’s push towards ethanol blending as part of sustainability goals also adds complexity and opportunity to production dynamics. Globus Spirits is strategically expanding its ethanol production capacity alongside value and premium liquor segments to capitalize on evolving market trends.

Looking Ahead: Resilience and Growth
While the flooding disruption is an immediate hurdle, Globus Spirits is confident in its recovery trajectory backed by sound operational planning and stakeholder support. The company’s emphasis on innovation, capacity expansion, and market penetration remains unchanged.

Management reaffirms commitment to high utilization levels across plants, maintaining product quality, and delivering customer satisfaction. The Samalkha facility plays a crucial role in this vision and its restoration is a top priority in the company’s operational roadmap.

In summary, the recent flooding at the Samalkha unit has posed short-term operational challenges for Globus Spirits Ltd, but the company’s diversified presence, quick responsiveness, and strategic initiatives position it well for a strong recovery and ongoing growth in the competitive spirits industry.

Sources : Globus Spirits official statements, company annual reports 2023-24, The Hindu Business Line, Moneycontrol, Business Standard Economic coverage.