QUARTERLY MAGAZINE February 2023 Vol 12
QUARTERLY MAGAZINE February 2023 Vol 12
Spotlight 
The RPG Annual Conference 2022 was back in its in-person avatar after a brief hiatus of two years. The two-day interactive conference was held in Mumbai on the 17th and 18th of November with participants from all over the world.
The conference included sector updates from the heads of respective companies; talks by guest speakers Harsh Mariwala, Chairman, Marico; Vineet Jaiswal, Former Group Chief Digital and Technology Officer, Vedanta; and Anish Shah, Managing Director & CEO, Mahindra Group along with updates on RPG group HR and group Finance, followed by a gala Awards night.
CEAT COO Arnab Banerjee shared an overview of the company’s growth and key milestones with the audience. The tyre major continues to register the fastest growth in its industry, with a CAGR of 10% over the last five years. The brand is trending at No. 1 position in motorcycles, while improving its market share in the PCR segment, and registering a 49% growth in the off-highway tyres business.
Arnab also shared an update on the company’s expanding geographical footprint. CEAT is making greater inroads across Brazil, Saudi Arabia, and Europe, with plans to enter the US market. CEAT Sri Lanka has continued to maintain margins and its hold on the market with a 50+% share, despite the economic turmoil in the country.
On the current EV market evolution, he spoke about the company’s growing market shares in this segment. CEAT is now making tyres for 2-wheelers, passenger cars, as well as truck radials, with plans to increase its market share in 2W EVs, and expand its footprint in the US markets.
A recent noteworthy achievement is the Lighthouse Certification for CEAT’s Halol plant by the World Economic Forum for the company’s implementation of Industry 4.0 practices on its shopfloor. CEAT is now working towards extending this application to the Chennai and Nagpur plants.
CEAT is diversifying beyond tyres, with exciting offerings that range from home fitment of tyres to fleet advisory services.
KEC’s MD & CEO Vimal Kejriwal outlined the growth trajectory of the infra major. Over the last five years, the company has expanded its diverse portfolio of offerings from five to 25, to include complex and high-velocity sectors such as oil and gas pipelines, metro rail, high-speed rail, etc. In the last five years, the company has registered a CAGR of 12% in revenues, 8% in PAT, and 16% in its order book. Revenues from its non-T&D businesses grew from 17% to 50%.
He shared that by 2027, KEC aspires to leapfrog into the league of large global players known for their engineering capabilities. The company has undertaken a transformation exercise with a leading management consultant, enabling it to build digital and technological capabilities, drive innovation, and develop capabilities to deliver complex projects that set industry benchmarks. Additionally, KEC has developed several in-house digital tools that help with planning, and monitoring of quality and safety in its projects, thereby adding to its digital prowess.
KEC continues to work on various sustainability-driven initiatives across areas such as health and safety, circularity, a water positive approach, energy consumption, carbon emissions, etc. The company has received various awards and recognition for its sustainable practices that include being ranked among the Top 50 by BusinessWorld magazine, and India’s Best Managed Companies for 2022 by Deloitte for the second year in a row.
Key trends that present an opportunity for KEC:
Anant Goenka, Vice Chairman, Zensar shared updates about the IT company. The company operates in the key verticals of high-tech manufacturing, banking, financial & insurance services, and consumer services for key global clients such as Cisco, Microsoft and Macys.
He detailed some of the key offerings across the five critical practices that Zensar operates in:
Anant also took the audience through some of Zensar’s important projects to showcase the vast scale of operations. One such project was to help Microsoft reimagine its future through design thinking and devise strategies for its Fortune 100 clients across industries. For Mastercard, Zensar has helped restructure its 400 websites to create a unified platform that could be leveraged globally, resulting in reduced customer go-to-market time by 25%.
Finally, sharing a few key milestones, Anant mentioned that the company has become a 1 billion ZAR company in South Africa, and has been recognised as a Top Employer for the second year running. It has also set up a new engineering studio in Chennai to help clients build lean teams for new products, and leverage AI, ML and futuristic capabilities for themselves.
RPG Life Sciences’ Managing Director, Yugal Sikri spoke about some of the recent wins and accomplishments of the pharma company. RPGLS has been profitable in all the three segments it operates in – domestic formulations, international formulations, and API, and has consistently outperformed the market, growing at 2x the industry average. He mentioned that the mid-size pharma company ranks amongst the top compared to its peers on aspects such as margins, liquidity, return, and leverage ratios. Yugal attributed this to some of the key initiatives undertaken such as transformation of the product portfolio, modernisation of its API and formulations plants, enhanced digital capabilities that have enabled better doctor-support connects, and happy employees who are committed to outperform and grow the business.
Vivek Venkatachalam, Managing Director, Raychem RPG, outlined the vast expanse of the company. Raychem RPG is currently operating under four key verticals.
The company has continued its growth trajectory with revenues increasing by 15% in FY22 to ₹1,188 crore. This was achieved through efficient cost management and enhanced product price points, which led to margin expansion.
Raychem RPG aims to
Harrisons Malayalam’s Chief Executive Officer (SBU-B), Cherian George, spoke about how the plantations company has been growing despite the various setbacks that it continues to encounter. The agri company is a primary producer of tea and rubber, and produces a sizable volume of pineapple and spices such as tea and cocoa. He shared some of the key focus areas for the company, such as improving the quality of tea, a higher focus on cost efficiencies that would lead to better productivity, leveraging digital technologies to improve produce, and investing in alternative crops and tourism to add to the bottom line.
Pramod Menon, Group CFO, shared updates on the Group Financial Performance, and targets for the current year. He spoke about how RPG Group has been managing growth amidst challenging economic conditions. In FY22, CEAT recorded the maximum topline growth at 23%, and KEC continues to be the largest company within the Group with a share of 47% in RPG’s total turnover. In H1 FY23, the Group continued to perform well at a 24% growth rate. Pramod shared the remarkable journey of pharma company RPGLS, which has shown a steady performance for the past 10-12 quarters. In addition to growing consistently above market levels, RPGLS' share price has also risen 5X in the period April 2020 to November 2022.
CFOs at all the Group companies have focused on leveraging digital capabilities across their businesses, such as the use of Blockchain to improve efficiency and increase transparency.
Rajat Bhargava, CEO – Speciality Sector and Head-Group Transformation, spoke about the impact of Digital at RPG. Over the last 12-18 months, the Group has undertaken over 150 digital projects, two big digital transformation exercises by CEAT and KEC, and initiated a digital-led business, Taabi. He shared that over 100 non-digital employees from the Group have been leading the digital transformation along with the strategic digital team, a key indicator of the programme’s success.
RPG Group has also made significant progress in leveraging robotic process automation and image analytics, and is assessing various opportunities in AI, ML, and Blockchain. Citing some examples of mature deployment in image analytics across the group, he shared that CEAT is using it for tyre inspection and claims processing; KEC for land topography analysis, PPE/safety compliance and monitoring; Raychem RPG for cable jointing, and QR code for safety gloves and other products; HML for leaf counting, colour sorting for coarse analysis; and RPGLS for quality control at its packaging lines.
With the metaverse being in the news globally, RPG too has undertaken three ongoing projects in KEC, CEAT, and Group HR, each holding the distinction of being the first-of-its-kind in the industry. Sharing insights from some exciting blockchain-related projects currently underway, Rajat said that the group is in the process of developing a blockchain based happiness coin.
S ‘Venky’ Venkatesh, President - Group HR, spoke about how RPG is “living the future of work”. He shared key highlights of the industry-first initiatives undertaken, especially in the last two years.
In terms of employee benefits, several policies and initiatives have been launched to help build a people-first brand. At the peak of the pandemic, a perpetual remote working policy was launched. FraternitE, a freshers’ hiring programme at Zensar was introduced, which gave an opportunity for the employee's next of kin to participate in the programme. Most recently, a 24x7 anti-harassment helpline against all kinds of harassment was also introduced within the Group.
On talent, the Group has continued to focus on offering growth opportunities to its internal talent first. The coveted Future Leaders Board is now present across all Group companies. The Group has also set up a unique alumni circle, which helps funnel boomerang hires. In addition to hiring transgender employees across its companies, RPG Group has set new benchmarks in corporate India by launching the country’s first LGBTQIA+ and heterosexual partners policy.
Radha Goenka, Director, RPG Foundation shared key updates on its work with the audience. The Foundation has installed 150+ Fever Clinics across Maharashtra, in collaboration with the National Health Mission and the state government. The initiative, aimed at supplementing the state’s rural health model, has so far serviced over 10 lakh people.
To provide English education access to more children during the pandemic, the Pehlay Akshar team created unique digital classrooms called Magic Classrooms that aired on Doordarshan. The show became the highest watched programme on the TV channel. This year, the Foundation has also developed physical learning rooms in municipal corporation schools across Mumbai, where children have access to all the digital content created by the team.
After the success of the Banganga intervention, the Foundation’s heritage arm, The Heritage Project – is now working on transforming the Worli Koliwada, an 800-year-old urban village surrounding the historic Worli fort. The Foundation’s employability programme, Swayam, has helped train over 12,000 candidates in the healthcare sector, and around 16,000 women across commercial driving, digital and construction sectors.
Harsh Mariwala shared his incredible journey since founding Marico well over three decades ago, and the learnings over the years. This session was a veritable masterclass on how to develop successful businesses and leaders.
He listed the three cornerstones of success – innovation, talent and a digital mindset. Innovation, he said, does not require huge resources but rather a risk-taking appetite and the right mindset to lead. It is essential to create an engine of innovation across products and processes, and encourage everyone to participate in driving this change.
Talent plays a very important role in any business. He stressed on the importance of selecting, training and retaining the right talent, while also encouraging leaders to embrace diversity.
Mariwala also spoke about the importance of having a roadmap for digital adoption and transformation. He urged leaders to proactively track emerging technologies, which may help create new business models and open up new avenues for growth.
As someone who helps large businesses navigate through complex technology-led change, Vineet Jaiswal had plenty of insights on how organisations can successfully become digitally-driven. Cultural transformation, he said, lies at the core of every successful transformational exercise. Organisations must therefore inspire their employees to adopt digital tools, make sure to lead by example, and finally support them by providing the required skillsets and freedom to succeed.
Jaiswal also narrated a few success stories of digital transformation during his tenure at Vedanta, along with some failures and the learnings from these. One such was the Paperless Logistics initiative, which covers four mines, 13 railway sidings and three ports in Odisha. The entire process was made completely touchless between the transporter and the company, by building a mobile app to allocate and assign assets. Moreover, Vedanta leased out GPS-enabled devices to drivers and transporters who did not have access to them. He explained how this initiative helped provide end-to-end visibility for the company.
Anish Shah spoke about the power of agility and collaboration in driving success across large organisations.
He emphasised that the critical capabilities needed to drive growth are being bold and making hard choices. Another important factor was inculcating a growth mindset. He said that while many of the big businesses are comfortable taking big bets, smaller and mid-size companies often become comfortable with the status quo. It is important for leaders to break this cycle, and take bold bets to grow their businesses.
The key to achieving this is collaboration. Businesses and teams need to work together to bring about cultural change within the organisation. Leaders, he stressed, need to focus on making this happen by incentivising collaboration, and creating a positive work environment where they are encouraged to take risks.
