At 63, Marico Ltd’s patriarch Harsh Mariwala is a hands-off boss, leaving day-to-day operations of the Rs 5,000-crore FMCG firm to a CEO. A golfer, he is busy writing a book, managing the company’s CSR initiatives and its investment arm. Excerpts from an interview with Sanjay Vijayakumar and Piyush Pandey.
How is the FMCG sector performing?
If you ask whether the FMCG sector has grown at a higher rate when compared to the past, the answer is no. It has maintained growth expected for rural demand, which has been impacted partly by the monsoon and partly because the maximum selling price has not been as aggressive. I believe the NREGA scheme has not been covered as extensively as before.
How do you plan to double Marico’s revenue to Rs 10,000 crore by 2020?
We have registered a consistent 15 per cent growth over a period of time, but are still at the building-blocks stage in terms of growth. I am confident that with time, the target of Rs 10,000 crore will be achieved. To some extent, we are providing for inorganic growth, as long as we get a good deal, mainly in the beauty and wellness space.
Do you consider Baba Ramdev’s Patanjali Ayurved as a potential threat?
I don’t know how sustainable it is. To maintain quality and drive innovation is tough. There are areas where the brand is closely associated with certain other ones. Most of them are me-too products offered at lower price points. I am not sure as to what extent they can continue with these and become a Rs 5,000-crore company. I have my doubts.
Why is the impact of reforms not being felt?
There are two schools of thought – one holds that India is a part of the global economy, which is not doing well. This has impacted our exports, and is impacting consumer goods in turn. On the other hand, the government has taken various initiatives on various fronts, including ease of doing business, relaxation in FDI norms, the new package for bank capitalisation, and on the power and distribution companies’ front.
However, these initiatives are taking their own time to become a part of the economy, where the growth rate is stagnant. Due to reforms in the pipeline and the perception of India internationally on account of the Prime Minister’s visits, the economy should do better after some time, maybe in six months or a year.
Will the Bihar election results derail the reforms process?
With inflation, fiscal and current account deficit under control, Indian macros are in good shape. We have to accelerate reforms. Some of them have been held back because of the Opposition, but there are areas in which the government doesn’t need the Opposition’s help, where it can actually move forward, such as judicial and administrative reforms and in ease of doing business.
The government should take bolder steps, like privatising loss-making units. Why, for example, does the government have to run Air India? It is a good time to get out of Air India and concentrate on other things, but it needs a bolder reforms stance to do that. This will send out the right signals. I believe there will be some mention of this in the new budget, which will have the stamp of the PM’s thinking. Rationalisation of benefits and lowering corporate tax rates is a good move, but the government should also simplify personal tax.
What takes up most of your time?
I am looking after Marico as its chairman and Kaya as its CMD. Two CEOs at Kaya are reporting to me. I am also looking after Marico’s CSR activity.
This takes up 60 per cent of my time. The remainder is devoted to initiatives I have taken up, including in mental health. For this, we have associated with the Tata Institute of Social sciences and are offering advice over the telephone and by email.
Around four years ago, we launched Ascent, a skilling enterprise where we help entrepreneurs to scale up.
What do you do in your free time?
I am reading a book named ‘The Inner Game of Golf’ by W Timothy Gallwey on how to improve golf through mental adjustment. A lot of golf is mental. I play golf on weekends. On Saturdays I play at the Willingdon Sports Club and at the Bombay Presidency Golf Club on Sunday.
You are also writing a book. What’s it about?
The book will focus on my journey. It is about building a small business into a large one, and the role of an entrepreneur at different growth stages of the business. Entrepreneurs have to make big shifts at the personal level.
You have set up a family office. What will its focus be?
In our family office, 80 per cent of investments go to the capital markets and the rest to non-capital markets, which includes direct investment in companies, funds, venture capital, technology funds and a combination of these.