‘At any given time, we are looking at 4 to 8 buyouts’ | business | Hindustan Times
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‘At any given time, we are looking at 4 to 8 buyouts’

business Updated: Mar 31, 2011 21:59 IST
Vivek Sinha
Vivek Sinha
Hindustan Times
Highlight Story

A Godrej surname does not guarantee top management position in the Rs 11,800 crore Godrej Group, even if one hails from the owner’s family. Professional qualification and performance only matters. Adi Godrej, chairman Godrej Group, tells Hindustan Times about the group’s focus areas and business plans. Excerpts:

Godrej Consumer Products Ltd (GCPL) acquired a number of companies during the last fiscal. How have these acquisitions helped?
We are running at a sales growth of over 80% for this year and profit growth is over 40%. This is partly because of strong growth in the domestic economy and partly because of our acquisitions. Overall the acquisitions have added a lot to our sales growth and after the interest cost of acquisitions — we borrowed money to acquire them — our profits have definitely grown at a healthy pace.

Are more acquisitions by GCPL on the cards?
Well I would not say ‘on the cards’, but at any given time, we are looking between four to eight acquisitions. So we will continue to acquire in the future and hope to announce some new acquisitions in the financial year 2011-12.

What could be the deal size?
The deal size could vary anywhere between Rs 50 crore and Rs 700 crore.

What are your expectations from the real estate business?
Real estate is our fastest growing business and we think in 10 years this will be the single biggest business in Godrej Group. In fact, I would be very disappointed if, over the next 10 years, our real estate business does not grow at 30 to 40% per year.

What makes you so confident?
Our model is very different from other real estate companies such that we generally do not buy land ourselves rather get into a joint-venture with landowners. Also we look towards roping in private equity at the project level. So our model is not affected by fluctuations in land price.

What is the succession plan in the Group?
We have a family council, which meets regularly and several family members are involved in the business. But we have a very strict rule that any family member who joins the business must, at least, be as qualified as professionals who join our business. So having a Godrej surname does not guarantee anything.