 In the decade since he found himself in his father's large shoes, Kumar Mangalam Birla has forged a career that could make him the biggest Birla of them all.
When his father, Aditya Vikram Birla, died of prostrate cancer 10 years back, very few people thought this shy and obsessively low-profile young son would be able to take over from his father.
Today, when Kumar Mangalam Birla, 38, talks about his dream of the Aditya Birla Group entering the Fortune 500 league, the world sits up and listens. Consider the figures: the turnover of the group, which has 16 companies and joint ventures in India and 22 separate international companies, mostly in South-east Asia, was worth Rs 15,000 crore (Rs 150 billion) in 1995.
It has more than doubled to Rs 33,000 crore (Rs 330 billion) today, with a market capitalisation of Rs 30,000 crore (Rs 300 billion). The journey has been long and in the process, Birla has razed many ancient financial practices and power centres within the group.
His doting grandparents Basant Kumar and Sarla Devi were always convinced that he was destined to succeed. Sarla Devi has an interesting story to tell: The Birlas organised a religious conclave attended by 180 religious leaders in Kolkata when the young Birla was only three and a half years old.
Present at the conclave was a Muslim religious leader from Sri Lanka who wrote a letter to BK making two forecasts - that his grandson would be seriously ill at the age of seven, but would be Birla number one eventually.
Kumar Manglam Birla did suffer from meningitis when he was seven, so Sarla Devi says she saw no reason why the second forecast wouldn't be correct as well.
And well it may, considering the scorching pace Birla has set for his group, shaping and reshaping his companies relentlessly. The result?
The group is today the world number one in viscose staple fibre; the world's largest single-location palm oil producer; Asia's largest integrated aluminium producer; a globally competitive, fast-growing copper producer; the world's third-largest producer of insulators; globally the fourth-largest producer of carbon black; the world's eighth-largest producer of cement and the largest in a single geography; India's premier branded garments player; among India's most energy efficient private sector fertiliser plants; India's second-largest producer of viscose filament yarn; the number two private sector insurance company and the fourth-largest asset management company in India.
"Our focus is to attain the leadership position in every business we are into. That is to be done through capacity expansion and cost reduction. Every business has been categorised according to the geographical leadership roles they can play and the focus is very much on profitability and growth rather than size or footprint," says D D Rathi, wholetime director and CFO of Grasim Industries.
On capacity expansion, the group is going to spend Rs 26,000 crore (Rs 260 billion) on Grasim in the next two years. Grasim has a 23 per cent share of the viscose stable fibre market and is the most profitable such company in the world.
"The aim is to reinforce the company's edge in the cellulosic man-made fibre sector through fully integrated operations, virtually from the forest-to-fabric," he says. In cement, Grasim, along with its subsidiary UltraTech, is the world's eighth-largest player.
Hindalco's alumina capacity is being raised from 350,000 tonnes per annum to 650,000 tpa and its high-value special alumina is being ramped up from 91,000 tpa to 167,000 tpa. The company is augmenting the power generation capacity from 67.5MW to 317.5 MW.
WYD Team
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