The Unusual Billionaires Quotes

“A rupee invested in Page Industries’ IPO in March 2007 is worth Rs 34 presently (in April 2016), implying a compounded annual return of 47 per cent. That same rupee would be worth just Rs 2 if invested in the Sensex, implying a CAGR of 8 per cent. Thus”
― Saurabh Mukherjea, The Unusual Billionaires

“A great company attracts the best talent, commands respect in the business community and, more often than not, trades at a premium in the stock market.”
― Saurabh Mukherjea, The Unusual Billionaires

“An empire that cannot sustain a blow and remain standing is not really an empire.’— Yuval Noah Harari, Sapiens: A Brief History of Humankind (2011)”
― Saurabh Mukherjea, The Unusual Billionaires

“over the past five years have led me to conclude that three factors are central to building a truly great company. Firstly, the management team has to have an obsessive focus on the core franchise instead of being distracted by short-term gambles outside the core segment. Secondly, the company has to relentlessly deepen its competitive moats over the course of time (I’m talking about decades here). And thirdly, the people calling the shots at the company have to be sensible about capital allocation, i.e. refrain from large bets (especially those outside core franchise) and return excess cash to shareholders if the cash cannot be deployed to good effect by the company.”
― Saurabh Mukherjea, The Unusual Billionaires

“stock prices are an effect and not a cause of a company’s greatness”
― Saurabh Mukherjea, The Unusual Billionaires

“Greatness is not a function of circumstance. Greatness, it turns out, is largely a matter of conscious choice.”
― Saurabh Mukherjea, The Unusual Billionaires

“Dhingra compares this focus to golf. He says, ‘My philosophy on capital allocation is similar to what happens in golf—focus on your stance and keep your eye on the ball (which for me is my business). When hitting the shot, don’t lift your head to look at the direction in which you want to hit; instead look at the ball. Then”
― Saurabh Mukherjea, The Unusual Billionaires

“To put this simply: companies which have high-quality accounts also tend to be companies which have high-quality management. These”
― Saurabh Mukherjea, The Unusual Billionaires

“The standard Indian corporate thinking focuses on the promoter’s wealth, not on the shareholders’ wealth. The two are not necessarily the same’.”
― Saurabh Mukherjea, The Unusual Billionaires

“The typical promoter of the companies profiled in the preceding chapters is patient and persevering, even bordering on the boring. He”
― Saurabh Mukherjea, The Unusual Billionaires

“Most companies tend to focus on short-term results and hence that makes them frequently do things that deviate away from their articulated strategy . . . these diversions take them away from the path they have to travel to achieve their long-term goals . . . the willingness to resist the temptation of short-term ‘off-strategy’ profits for long-term sustainable gain is not there in most Indian companies,’ writes Rama Bijapurkar, a leading market strategy consultant and independent director (2015).”
― Saurabh Mukherjea, The Unusual Billionaires

“Reasoning that runs cannot be scored in the pavilion, he sets out to protect his wicket. Curiously, this thought does not seem to occur to many batsmen, a point many a long-suffering coach could confirm.’21”
― Saurabh Mukherjea, The Unusual Billionaires

“Amidst the cacophonous tumult of India, there is a tendency to look for greatness and leadership amongst those who have flair, flamboyance and a certain sense of extroversion. But perhaps because the country is so prone to major upheavals—both social and economic—those who achieve long-lasting success in India are often those who are unflashy, introverted, determined and intelligently tenacious.”
― Saurabh Mukherjea, The Unusual Billionaires

“He was a man with zero understanding of plumbing. It’s a surprise that he learnt the business and built the largest CPVC franchise in India,’ Malwawala told me.”
― Saurabh Mukherjea, The Unusual Billionaires

“Leaving a position (like export or imports) unhedged is risky and can cause forex losses. Astral paid the price in FY09, when a 33 per cent depreciation in the Indian rupee left the firm with a forex loss of Rs 7.7 crore, wiping off 40 per cent of its profit before tax (PBT). Astral’s stock price declined by 84 per cent in March 2009 due to these losses, compared to its peak in January 2008. Finally,”
― Saurabh Mukherjea, The Unusual Billionaires

“Engineer’s fascination with CPVC began in the mid-1990s. During this period, in the construction and plumbing industry, pipes were still made of iron and copper. Engineer saw that corrosion was a major problem with galvanized pipes and India was materially behind the evolution curve in the use of plastics for pipes. In the United States, CPVC was the new anti-corrosion solution for plastic pipes, which was swiftly replacing metal (iron and copper) pipes in industrial applications. CPVC was also a superior product compared to PVC because of higher ductile strength, which gave it the ability to handle hot water up to 200 degrees Fahrenheit (93° Celsius) (PVC can handle hot water only up to 140 degrees Fahrenheit [60° Celsius]). B.F. Goodrich (now known as Lubrizol) held the patent for CPVC resin technology, and Engineer decided to tie up with them to bring CPVC to India. He travelled to the United States to forge a techno-financial joint venture (JV) deal with Thompson Plastics of USA, which provided Astral with the technical know-how for setting up the CPVC plant. Astral also acquired the licence for CPVC resin procurement from Lubrizol (the first Indian company to do so). With a JV partner on board and a licence in his hand, Engineer set up Astral Poly Technik in March 1996. Thompson put up 20 per cent of equity for the company and Engineer approached his uncle to fund another 20 per cent. For his personal equity contribution, Engineer sold his house in Ahmedabad. I met Engineer at Astral’s corporate office located off the bustling Sarkhej–Gandhinagar Highway and behind the prestigious Rajpath Club in Ahmedabad. Recalling those early days, Engineer told me, ‘There was a time when everything my father-in-law and I owned was mortgaged to build Astral.”
― Saurabh Mukherjea, The Unusual Billionaires

“Greatness is not a function of circumstance. Greatness, it turns out, is largely a matter of conscious choice.’ —Jim Collins, Good to Great (2001)”
― Saurabh Mukherjea, The Unusual Billionaires

“H. Srikrishnan, then head of transactional banking and operations, gave me an example, ‘We looked at funds transfer—which was manual—such as MTs (mail transfers) and TTs (telegraphic transfers). When we implemented a centralized banking solution, the key things we could do were to sweep across multiple locations and get the balances of customers or transfer funds from one location to another using core banking. Those were big problems we solved.’ HDFC Bank was thus the first among Indian banks to have a centralized system. Whilst foreign banks like Citibank had centralized systems, they lacked the branch strength to fully leverage them. It is worth remembering that in the mid-1990s, banking didn’t really exist in the form that we know of today. Customers could open bank accounts, but the whole gamut of products (home loan, car loan, etc.) and services (Internet banking) was just not available. Salaries would still be paid by cheque and employees would have to take time off from their jobs to go to the bank, write a deposit slip, hand it over to the teller and then wait for the cheque to get cleared. Also, the employer would have to take time off to sit and sign numerous salary cheques to be given to all the employees. Compare this to the instant, online credit of salary today and a notification by SMS and email at the end of every month! HDFC Bank’s centralized technology platform allowed it to kick-off a revolution in how employees were paid their salaries.”
― Saurabh Mukherjea, The Unusual Billionaires

“Simplicity is the ultimate sophistication.’ —Leonardo da Vinci”
― Saurabh Mukherjea, The Unusual Billionaires

“Each bank has its own culture and while the official version is printed on websites and annual reports, the culture really manifests when you meet employees, insiders and banking sector veterans. For example, ICICI Bank’s aggressive, sink-or-swim culture is legendary. Similarly, HDFC Bank is highly respected for its focus on systems and processes, so much so that one insider called it SOP bank, where SOP stands for Standard Operating Procedure.”
― Saurabh Mukherjea, The Unusual Billionaires

“Nayak came as a big boost to the bank’s image, given Nayak’s reputation as a man of high integrity. Axis Bank’s share price nearly tripled in two months (the period between 30 November 1999 and 4 February 2000), based purely on the news of Nayak taking charge (see”
― Saurabh Mukherjea, The Unusual Billionaires

“One of Bengaluru’s largest innerwear multi-brand retailers told me, ‘Jockey gives me 25–30 per cent margin compared to around 35 per cent for some other brands. However, if I keep other brands and Jockey in front of new customers; out of ten customers, seven will walk out with Jockey. I can guarantee that.”
― Saurabh Mukherjea, The Unusual Billionaires

“Despite initial enthusiasm from Page’s distributors, as an overall category, innerwear remained a low-profile product in retail stores. This would ultimately necessitate a high-pitched, pan-India advertising campaign from Page, but the costs were prohibitive. Competitive intensity from incumbents had already increased substantially during 1995–2000. When the company reached sales of Rs 21 crore in FY2000, Rupa and Maxwell were already at Rs 150 crore each. One level above them, in the mid-premium segment, brands like Liberty, Libertina and Tantex (TTK Tantex) were firmly ensconced. Associated Apparels (Liberty and Libertina) reported sales of Rs 100 crore during the same period. In a stroke of luck for Page, both TTK Tantex and Associated Apparels fell prey to labour strikes. TTK Tantex saw labour-related plant shutdowns in 1997 that lasted for two years, sending the company’s revenues into a steady descent (see Exhibit 55). The TTK Group had twenty companies across many sectors and, due to lack of management bandwidth to handle the crisis, sold the innerwear brand in FY02. In the same year, Associated Apparels had a labour strike in one of its factories that disrupted its supply chain. The exit of both TTK Tantex and the crippling of Associated Apparels played into Page’s hands as all the large innerwear retailers (dealers) in northern and western India shifted to Jockey.”
― Saurabh Mukherjea, The Unusual Billionaires

“Interestingly, Jockey’s first attempt to enter India wasn’t with the Genomals. It was with Associated Apparels in 1962. Through the 1960s, many foreign innerwear brands were launched in India. Associated Apparels introduced the then world-famous Maidenform bras (owned today by Hanes) and tied up with Jockey to launch Jockey underwear in 1962. The international brand, Lovable, entered India in 1966 through a licensing deal and became a huge success. Along with it entered the brand Daisy Dee, through a subsidiary of Lovable, followed by Feelings. In 1971, Maxwell Industries launched VIP-branded innerwear for men in the economy segment, catching the attention of the discerning public with an advertisement featuring a Bollywood actor. In 1973, however, Jockey decided to leave India after the Indian government used the Foreign Exchange Regulation Act (FERA) to force multinational companies to dilute their ownership in their Indian ventures to 40 per cent. After Jockey exited India, its competitors flourished. Associated Apparels continued to focus on mid-premium innerwear during the 1980s and was successful in establishing themselves as a dominant player in the mid-premium innerwear segment through Liberty (men) and Libertina (women). Maxwell Industries, during the 1980s, launched the brand, Frenchie, to cater to the mid-premium innerwear segment. In 1985, Rupa & Co. emerged in the innerwear market, offering products across categories, including men, women and kids, and became one of the biggest manufacturers and sellers of innerwear in India. The success of Rupa was followed by many other domestic brands in the 1980s and ’90s, including Amul, Lux Cozi and Dollar in the men’s category, while Neva, Bodycare, Softy, Lady Care, Little Lacy, Red Rose, Sonari, Feather Line, etc., were the key players in the lingerie market. Then came the liberalization of 1991. With the regulatory hurdles to enter India removed, Jockey decided to return to India. And this time, it chose the right partners.”
― Saurabh Mukherjea, The Unusual Billionaires

“In the 1950s, V. Lilaram & Co. was the first company to charter a Pan American airlines cargo flight with a full load of textiles from New York to the Philippines. The top-selling item, Verhomal noticed, was Jockey undergarments, which catered to the American military which was still present in the Philippines in large numbers after the war. The largest American air and naval bases outside the US mainland were in the Philippines—Verhomal’s main market. From these military bases, Jockey’s market expanded to the local population in the Philippines. Forty years later, in the 1990s, Jockey International (USA) gave the exclusive licence to the Genomals to form a company that would launch and expand Jockey’s presence in India. Within two decades, this company—Page Industries—would go on to become the biggest licensee of Jockey in the world.”
― Saurabh Mukherjea, The Unusual Billionaires

“Nothing contributes so much to tranquillize the mind as a steady purpose—a point on which the soul may fix its intellectual eye.”
― Saurabh Mukherjea, The Unusual Billionaires

“In the late 1990s, Parachute was the market leader with more than 50 per cent market share. Fresh from its success in taking market share in toothpaste away from Colgate using Pepsodent, HUL entered the coconut oil category to take on Marico. Dadiseth, the then chairman of HUL, had warned Mariwala to sell Marico to HUL or face dire consequences. Mariwala decided to take on the challenge. Even the capital markets believed that Marico stood no chance against the might of HUL which resulted in Marico’s price-to-earnings ratio dipping to as low as 7x, as against 13x during its listing in 1996. As part of its plans to take on Marico, HUL relaunched Nihar in 1998, acquired Cococare from Redcon and positioned both brands as price challengers to Parachute. In addition, HUL also increased advertising and promotion spends for its brands. In one quarter in FY2000, HUL’s advertising and promotional (A&P) spend on coconut oil alone was an amount which was almost equivalent to Marico’s full year A&P budget (around Rs 30 crore). As Milind Sarwate, former CFO of Marico, recalls, ‘Marico’s response was typically entrepreneurial and desi. We quickly realized that we have our key resource engine under threat. So, we re-prioritized and focused entirely on Parachute. We gave the project a war flavour. For example, the business conference on this issue saw Mariconians dressed as soldiers. The project was called operation Parachute ki Kasam. The leadership galvanized the whole team. It was exhilarating as the team realized the gravity of the situation and sprang into action. We were able to recover lost ground and turn the tables, so much so that eventually Marico acquired the aggressor brand, Nihar.’ Marico retaliated by relaunching Parachute: (a) with a new packaging; (b) with a new tag line highlighting its purity (Shuddhata ki Seal—or the seal of purity); (c) by widening its distribution; and (d) by launching an internal sales force initiative. Within twelve months, Parachute regained its lost share, thus limiting HUL’s growth. Despite several relaunches, Nihar failed against Parachute. Eventually, HUL dropped the brand Nihar off its power brand list before selling it off to Marico in 2006. Since then, Parachute has been the undisputed leader in the coconut oil category. This leadership has ensured that when one visits the hair oil section in a retail store, about 80 per cent of the shelves are occupied by Marico-branded hair oil.”
― Saurabh Mukherjea, The Unusual Billionaires

“The cost of labour involved in painting a home has increased to approximately 65 per cent of the project cost for a household from around 10 per cent in 1980. This is because labour costs have grown at 9–10 per cent CAGR over FY06–15 versus a mere 3 per cent CAGR in paint prices. With this trend likely to continue, there is a high likelihood that fifteen to twenty years from now, labour costs will be around 90 per cent of the overall paint project cost. Thus, in the future, it might make more sense to buy paint from a store and paint a home yourself rather than employ painters and labourers. Indeed, this is the practice in developed economies. Once”
― Saurabh Mukherjea, The Unusual Billionaires

“This approach of building the business from rural to urban India, and delivering on untapped consumer demand helped the company reach an annual turnover of Rs 23 crore with only 2 per cent PBT margins10 in 1952, a decade after it was founded.”
― Saurabh Mukherjea, The Unusual Billionaires

“Persistence is what makes the impossible possible, the possible likely, and the likely definite.”
― Saurabh Mukherjea, The Unusual Billionaires