Back in 2014, Purcari Wineries Group adopted a new strategy aimed at ensuring its survival under tough geopolitical conditions after Russia blocked market access to Moldovan wine. 10 years later, with years of profitability and a Bucharest Stock Exchange (BVB) listing under its belt, the winemaker has unveiled a new strategy to further hike profits and pursue aggressive expansion in the Central and Eastern Europe (CEE) region. 

The strategy was announced ahead of the 200th anniversary of Chateau Purcari, the group’s flagship winery in southern Moldova, which is coming up in 2027. The group, which now has vineyards in Romania and Bulgaria as well as Moldova, is aiming to double its key financial metrics by its bicentennial year. 

The strategy, named 2X by 200, was revealed at an investor day on October 4. Purcari is targeting sales of over RON600mn (€120mn) and Ebitda exceeding RON200mn by 2027, roughly double the figures from 2023. 

At the time of the IPO in 2018, Purcari set the goal of building a regional champion. “For more than five years we did well as a public company, and succeeded in our strategy of building a regional champion. Today, Purcari is the largest winery in Central and Eastern Europe,” Purcari founder Victor Bostan told the winemaker’s investor day on October 4. 

“Today we are very excited because we are again looking to reinvent ourselves. We will be 200 years old around three and a half years from now. We want to build a company that will last another hundred years.” 

Eugeniu Baltag, investor relations director at Purcari, gave more detail on the need for a fresh strategy in an interview with bne IntelliNews in Chisinau. 

“2027 is a crucial year because our flagship winery will be 200, which is an especially big milestone in a country like Moldova. This is the right moment to issue the strategy with a clear vision of the direction we are going in,” said Baltag. 

“The previous strategy in 2014 was for our survival. After the second embargo from Russia in 2013, we had lost our entire market in that region. Today it is not a matter of survival, but of our commitment to our shareholders … it’s important to show them a roadmap of where we plan to go.” 

Focus on profit and expansion 

The new strategy is based around three key pillars: profitable growth, winemaking excellence and commercial excellence, according to the company’s presentation to investors. These objectives will be supported by improvements in digital tools, talent, and culture, with the CEE region remaining a focal point for growth.

Purcari already sees itself as a champion in Emerging Europe, and its aim is to solidify its footprint in the region while expanding globally, the company said. 

“Our focus is on New Europe, for both production and sales. We first plan to position ourselves as champions in New Europe, and then plan to expand globally. To grow organically is not sufficient, and we will have to continue with M&As,” Baltag told bne IntelliNews. 

Key markets include Romania, Moldova and Bulgaria, where it already has vineyards, as well as the broader CEE area, the UK, US and Asia. 

To fuel growth, Purcari will continue its premiumisation efforts, promoting high-end ranges like Purcari Nocturne and pursuing mergers and acquisitions to strengthen its market position. This follows on from takeovers in recent years such as the Angel’s Estate Winery in Bulgaria and the purchase of 51 hectares of vineyards close to its Crama Ceptura winery in Romania’s Dealu Mare region. 

Purcari's plans also include expanding production capacity and planting new vineyards to ensure a steady supply of high-quality grapes. The group is particularly committed to promoting indigenous grape varieties, such as Rară Neagră.

Geopolitical challenges 

Part of the new strategy is adapting to changing conditions. “Purcari has to adapt to realities: geopolitical changes, changes in consumer behaviour, trends in winemaking, even climate change,” commented Baltag. 

Following Russia's market embargo in 2013, Purcari shifted its focus Westward, particularly toward Romania, a move that laid the groundwork for its 2018 IPO. The company's ability to diversify across more than 40 countries proved crucial during subsequent crises, including the COVID-19 pandemic and the war in Ukraine.

Fallout from the war in Moldova’s neighbour was relatively small, as by the time of the invasion in February 2022, its exposure to Eastern markets such as Kazakhstan and Belarus was low. The company did, however, have to adapt to logistical challenges, rerouting its exports through Constanta, Romania, after the port of Odesa in Ukraine was blockaded. This detour, while challenging, helped the company maintain its presence in key markets like Asia and the US.

Changing trends

In addition to navigating political challenges, Purcari is also adapting to changing consumer preferences and the impact of climate change on wine production. Baltag highlighted a growing trend toward lower-alcohol wines, which aligns with consumer preferences for healthier and more sustainable options.

“There are clear changes in consumer behaviour. Red wine consumption is decreasing, while white and rose are growing. People have started to drink less mass market wine, they prefer to drink on fewer occasions but to drink good wine,” said Baltag. 

“There is a trend towards lower alcohol wines as the younger generation are very attentive to what they are consuming. People also want bio wines – 25 hectares of our vineyards have already been converted to sustainable agriculture.” 

Climate change has made winemaking more complex, with warmer weather resulting in higher sugar content in grapes and, consequently, higher alcohol levels in wines. To counteract these effects, Purcari has introduced innovative irrigation systems, including sub-surface irrigation technology from Israel, which is helping the company mitigate the risks posed by changing weather patterns.

Overcoming perceptions

While Purcari has been highly successful in international wine competitions, it continues to fight against lingering perceptions of Moldovan wine as being of lower quality. Baltag pointed out that the company has made significant progress in promoting Moldovan, Romanian and Bulgarian wines as high-quality alternatives in global markets.

“If you look at how many awards we have won in international contests, we have nothing to prove; we can produce high quality wines, and are doing so in a sustainable and consistent way,” he said. 

“But we have to convince regular consumers. There are still some perceptions that Moldovan wine is sweet and poor quality, which is not true. We are one of the pioneers to promote Moldovan, Romanian and Bulgarian wines as better wine.” 

As the company approaches its 200th anniversary, it aims not only to change perceptions of wines from the region, but to grow into a dominant player in the global wine industry.