Sunder Genomal believes the best of Page Industries is yet to come
In the summer of 1993, it was business as usual for 40-year-old Sunder Genomal in Manila—where he ran his family business of manufacturing and distributing Jockey products in the Philippines—when Rick Hosley, then president of the US-based innerwear brand, made him an offer. Hosley wanted Genomal to become the brand’s exclusive licensee for manufacturing and distribution in India.
Genomal had not seen this coming despite having accompanied Hosley to India a few months earlier to help him scout for a partner to operate in the country. Hosley’s reason to fall back on Genomal isn’t far to seek. The company was making a second attempt at entering India. Constrained by regulatory requirements under the Foreign Exchange Regulation Act (Fera), which required multinational companies (MNCs) to dilute their ownership in Indian ventures to 40 percent, Jockey had to end its decade-old manufacturing and distribution partnership with Associated Apparels in 1973. Now, in 1993 (post-liberalisation, Fera rules were relaxed to allow MNCs at least a 51 percent stake in their Indian ventures, and were eventually repealed in 1998), Jockey was looking to enter the market again, and Genomal—whose family had a similar relationship with the brand in the Philippines since 1959—could be relied upon to be the trusted lieutenant.
“Jockey was approached by some well-known large companies for the licence in India. They surprised us by asking if our family would be interested in taking the licence since they did not sense the right quality and marketing culture in any of the companies that showed an interest in the brand,” recalls Genomal, managing director of Page Industries, the company he founded in 1994 to manufacture and distribute Jockey products in India.
Although Hosley saw merit in entrusting Genomal with the task, Genomal himself dithered. The size of the Indian market was daunting; it was 10 times the area and 14 times the population of the Philippines in 1993, and would be a different demon to tame. Besides, the Genomal family—although originally from Hyderabad—had never had any business in India. “We had neither lived in India nor done business there. They [Jockey] said we can live with that, and have partners whom we know and trust,” says Genomal, sitting in a conference room at the company headquarters in Bengaluru, where the walls are adorned with plaques and certificates from business partners.
In the 23 years since its launch, Page Industries has dwarfed Indian innerwear brands. The company’s profit last fiscal, ₹266 crore, was more than the cumulative profit clocked by VIP Clothing Ltd (loss of ₹5.79 crore), Rupa and Co Ltd (₹77 crore), Lux Industries (₹63 crore) and Dollar Industries (₹43.47 crore). Its revenue of ₹2,154 crore was more than double of what any of these companies posted. Among one of the most expensive stocks to trade on the bourses, Page Industries has seen its share value appreciate by 55 times to about ₹20,011 since going public in 2007 at ₹360 apiece. Earnings per share (EPS) for FY17 were ₹238.74, more than the combined EPS of information technology majors Infosys, Wipro and Tata Consultancy Services.
In the process, the Genomal family’s fortune has grown manifold. Led by brothers Sunder, Ramesh, 68, and Nari, 76, the promoters hold a 49 percent stake in the ₹22,320-crore company, culminating in a net worth of ₹11,360 crore ($1.75 billion). Sunder Genomal and family are ranked 87th on the 2017 Forbes India Rich List.
The association between the Genomal family and Jockey dates back to the 1950s, when Sunder Genomal’s father Genomal Verhomal ran a textile and garment import and wholesale business, V Lilaram & Co, which, among others things, imported Jockey innerwear to cater to the US military personnel stationed in the Philippines. It wasn’t long before the brand caught the fancy of the locals, prompting Jockey to offer Verhomal a manufacturing and distribution licence in 1959.
An astute businessman, Verhomal ensured that his sons, Nari, Ramesh and Sunder, got a solid understanding of the business before they took over; whenever the boys would get time off from their studies, they would be at the offices and shop floors of the business. Genomal recalls stepping into a Jockey manufacturing unit owned by his father when he was 10, and spending his teenage years running errands—packing cartons, taking stock of the inventory, and going on sales rounds. After completing his engineering in industrial management from De La Salle University in the Philippines, Genomal formally joined the family business in 1976.
In 1993, it was time to make all this experience count by entering an unchartered territory like India, where the women’s innerwear segment was dominated by brands such as Lovable, Daisy Dee, Libertina, Neva and Feather Line, among others, and men had to choose from among mass-market brands such as VIP, Rupa, Amul, Lux Cozi and Dollar. Jockey aimed to fill the void in the premium segment. Back then, retailers barely focussed on innerwear. More often than not, stocks were piled in store rooms or shoved under a counter. There were limited design and colour options. Let alone in-shop advertisements, even displaying the products alongside apparels was unthinkable.
This was the market that Genomal entered with the aim of selling a brand that was high on design, packaging and marketing. Founded by Samuel T Cooper in 1876 in St Joseph, Michigan, Jockey claims to be the first innerwear brand to display products on the sales floors of major retailers in the 1910s, and the first innerwear brand to be endorsed by sports stars such as baseball legends George ‘Babe’ Ruth Jr, Jim Palmer and Peter ‘Pete’ Rose; it even hosted an innerwear fashion show in 1938, and introduced the concept of stitching the brand name onto the waistband of products.
Genomal had to find distributors who would buy into his dream; those who would devote time and resources to meet Jockey’s global marketing standards. “We couldn’t have our products displayed and sold the way innerwear was being sold at that time. My biggest fear was how retailers in India would accept our model for selling and marketing the brand,” he says.
Genomal started by employing consultancy firm Marg to conduct a market research, based on sample products he sent to India from the Philippines; Marg’s report contained rave reviews of the products. Genomal’s brothers-in-law and their acquaintances, who ran businesses in India and were familiar with the textile industry, helped him understand the supply chain complexities in the country.
By early 1994, Genomal had laid out the blueprint of setting up shop in India. Page Industries (then called Page Apparel Manufacturing) would source raw material, operate their own manufacturing facilities and supply finished products to distributors across the country. Over his frequent trips to India, during which Genomal would visit factories and fabric manufacturers, he had identified Mumbai as the city in which to set up the company’s headquarters. But that was not to be.
Employees work at Page Industries’ facility in Hassan, Karnataka. The company says it only hires women at its factories as their hands are more nimble
On one such trip to India in June 1994, this time accompanied by his wife Madhuri, Genomal decided to visit his sister in Bengaluru for the first time. What was initially planned as a two-day break from work, stretched to 10 days. Genomal spent most of the time in identifying a location for a factory and stitching deals with suppliers of raw materials.
“Real estate was much cheaper in Bengaluru than in Mumbai. You could get sprawling properties here, which would be just 35 to 40 minutes away from the centre of the city. In fact, we were also planning to source a lot of raw material from down South, from Tiruppur, Chennai, Bengaluru and Hyderabad. Labour was also plentiful here,” says Genomal.
By early 1995, Genomal’s core team, led by his first hire GP Albal, who now serves as an independent director on the company’s board, had covered enough ground to mark Jockey’s re-entry into India. The suppliers had been identified, the factory at Bommanahalli on the outskirts of Bengaluru was fixed with state-of-the-art equipment from Japan and an army of women workers—a rarity in India’s garment factories of the 1990s—was hired. (In the Philippines too, Genomal hired only women at his factories. “We hired only female operators because their hands are more nimble, and it is easier for them to handle smaller garments,” he explains.) Factory managers from the Philippines were also flown in to train the local workforce.
Meanwhile, Genomal organised conferences for top retailers in seven cities, including Delhi, Mumbai and Bengaluru, to gauge their interest in selling Jockey products. The response was “overwhelming”, he says. The company was set to roll with about 10 distributors and 120 retailers. The factory started commercial production in August 1995, with Jockey products reaching Bengaluru stores in November, followed by Mumbai, Chennai and Delhi. In December, the brand made an ad splash in newspapers: “Burn your briefs, Jockey has arrived.”
But that’s not quite what happened. Jockey was expensive. While an average Jockey product was priced between ₹50 and ₹60, with the highest price tag touching ₹120, local brands sold for about half the price. The company earned ₹2.3 crore in 1995-96, and sales weren’t growing very fast.
But the next decade was one in which the purchasing power and patterns of middle-class India saw a dramatic shift.
Since its launch in 1994, Page Industries has dwarfed Indian innerwear brands
Between 1996 and 2006, India’s per capita gross domestic product doubled from $396 to $792, and urban Indians began to flock to multi-brand retail outlets (MBOs) such as Shoppers Stop and Lifestyle. Consumers were willing to spend more for global brands.
“Around 2004, we were able to stock in MBOs. It was a turning point, in the sense that since we were in MBOs, the hosiery stores started respecting us a little more. They realised this was not regular innerwear that we were selling,” says Vedji Ticku, a Page Industries veteran since 1997 and the current chief executive officer. “It wasn’t very easy even then. It isn’t easy even now. You need to reach a threshold point where you are well accepted as a brand. It was between 2004 and 2006 that things started changing.” It was a decade after starting out that Page Industries crossed the ₹100-crore sales mark.
“Jockey has successfully created a mid-to-premium segment in the urban area, which was a virgin space. This is unusual because for any other category, this is the most crowded segment, as far as a branded play is concerned. As incremental urban demand got created, Jockey ended up occupying that space,” says Ankur Bisen, associate vice president of retail and consumer products at Technopak Advisors.
Buoyed by the spurt in revenues, Page Industries floated a ₹100-crore initial public offering (IPO) in 2007. Back then, the company had three manufacturing facilities and a presence in 14,000 retail outlets and 17 exclusive brand outlets.
Flush with funds, the company embarked on an aggressive marketing drive and spent the next few years in increasing manufacturing capacity—it now has a workforce of 20,000 people, 15 manufacturing units with one in Tiruppur and the rest in Karnataka—and expanding into smaller towns and cities.
Talking about the experience he gained from the Philippines business where he, along with brothers Nari and Ramesh, continue to be shareholders, and which was renamed GTVL Manufacturing Industries in 1987, Genomal says: “The experience and expertise that evolved over five decades in this business [in the Philippines] has given us our fundamental strengths, both in the back end, where we have mastered the manufacturing processes by maximising operational efficiencies while producing the very best quality products, and in the front end where we are very strong in product design and development, innovative marketing and retail and distribution.”
And he hasn’t looked back since the 2007 IPO. Annual sales have grown by 21 times between FY06 and FY17. Today, Page Industries works with 900 distributors and has a presence in more than 50,000 retail outlets and 370 exclusive outlets. It has also expanded to Sri Lanka (1997), Nepal (1998) and the UAE (2012).
“Page Industries has taken time, and has gone through the struggle of building a brand. But they stayed on course and built the fundamentals of the business, which are product quality, distribution network and brand building, without looking for shortcuts,” says Hemchandra Javeri, chief executive at Forum Synergies (India) PE Fund Managers. “It takes time to build a brand that consumers like, especially one with the scale and size that they have today.”
Genomal—who made Bengaluru his home in 1995 and lives there with his wife and two sons—has been at the forefront of the company’s growth into the largest licensee for Jockey, a brand that sells in at least 147 countries, and standing firm in the face of stiff competition from innerwear brands such as Hanes, Fruit of the Loom, Tommy Hilfiger, FCUK and Calvin Klein, as well as apparel brands like Levi’s, US Polo Association and Van Heusen which launched innerwear. In 2012, the company partnered with swimwear brand Speedo, a ₹34.5-crore segment until FY17, which is overseen by Genomal’s elder son Shamir, 33, the chief strategy officer at Page Industries; younger son, Rohan, 25, is part of the business excellence team.
“The MD is a visionary. He makes investments at the right moment and ahead of time. It takes 12 to 18 months to create infrastructure. Once the investments go in today, products will come out in 18 months. At that time, we should be ready to sell them. He has the vision to understand that. Today, we are already planning till 2020,” says Ticku.
Today, at 64, Genomal runs Page Industries with a fervent zeal.
“I tell my team, keep reaching for the stars but keep your feet on the ground. I truly believe the best of Page Industries is yet to come,” he says.
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(This story appears in the 29 December, 2017 issue of Forbes India. To visit our Archives, click here.)