‘Young’ RPG bets on new overseas markets for growth | business | Hindustan Times
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‘Young’ RPG bets on new overseas markets for growth

business Updated: Sep 02, 2012 21:41 IST
Manu P Toms
Manu P Toms
Hindustan Times
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The Rs 15,000-crore RPG group is eyeing overseas acquisitions, especially in information technology, power and infrastructure, to position itself as a global business major. The company is also banking on its young talent to drive growth.

The group, which plans to increase the contribution of overseas business in its revenue books to 50% in four years from the current 40%, is also looking at a younger and vibrant management.

Earlier this month, Wipro’s BPO business head 39-year old Manish Dugar joined RPG as group CFO. Five months ago, Anant Goenka, the 31-year old son of Harsh Goenka, became the managing director of Ceat.

“At the management board we are averaging 50s. We want it to make younger and vibrant. These two will bring down the average,” Harsh Goenka, chairman, RPG Group, told HT.

Globalisation seems to be the group’s new mantra. “One of the important strategic step we have taken is that we are globalising our businesses,” said Goenka. “We have taken over three companies in IT. Two based out of US and one based out of Japan. We bought transmission business which is based in the US. We are looking at more acquisitions.”

About Zensar, the group’s IT firm, he said: “We are now No.15 (in India). The immediate goal is to reach top ten.”

On the group’s flagship tyre business, Goenka said: “We have a plant in Sri Lanka. We are putting up a large one in Bangladesh.” The group’s tyre firm Ceat is looking to increase its stake in its Sri Lankan subsidiary from the current 50%, said sources.

RPG group’s infrastructure arm KEC is looking to expand into water resource management and railway signalling systems.

However, the group will remain conservative in its approach to growth, said Goenka. “We may not be the fastest growing but we will be one of the most sure-footed business groups in India. In the first quarter, when most business groups have floundered, we have grown in operating revenue by 20% operating profit by 87%.”
“If we see the companies that have grown so rapidly in the last four or five years, 90% of them are in deep trouble because they leveraged themselves and market is not supporting them. I don’t know how with a leverage of R30,000-60,000 crore these companies can sustain,” he said.