Forbes India 15th Anniversary Special

5 Unlisted Marwari Entrerprises Worth Noting

The business community from Rajasthan has traversed the country and even spread its wings overseas—all in the quest for enterprise

Published: Mar 24, 2014 06:56:36 AM IST
Updated: Mar 28, 2014 10:47:35 AM IST

Jahan na jaaye bail-gaadi, wahan jaaye Marwaadi. (A Marwari [businessman] reaches even where a bullock-cart cannot) This phrase, or versions of it, has been a part of folklore in many Indian towns. Its essence—that the Marwari will find opportunity even in the most seemingly unreachable places—effectively highlights the ubiquity of the trader community from Rajasthan that has dominated India’s trade and commerce over centuries.

What has helped has been the ease with which the traders have integrated with the locals, taking up their language, customs and names. In places such as Kolhapur, for instance, they say that they don’t even identify themselves as Marwaris. But, elsewhere, they have retained their links with the mother state as well as their social and cultural uniqueness. In some clans, like the Maheshwaris, marrying outside the community has long been considered uncommon—to that extent, they uphold their particular identity. But for others, like the Agarwals, it has been easier to “belong” where they settled.

But, either way, their ability to build has ensured commercial success, irrespective of geography. So it is that the Marwaris from Rajasthan form a substantial part of the entrepreneurial pool in India. They straddle the business spectrum—from small shopkeepers to the big guns of corporate India. And this section of the issue, specifically, showcases a cross-section of unlisted companies promoted by the community.

Forbes India spoke with five entrepreneurs, all worth over $100 million this year. Some, like private seed major Mahyco, are well known; others such as Famy Care, are not as famous but their products are used widely. It is a sign of our times that three of these unlisted companies are global ventures, manufacturing and selling their products worldwide.

The selection of these five companies was made from a master-list generated through research involving conversations with Marwari community groups in various parts of India. We reached out through people who are well-networked socially. For instance, some like Pramod Kasat, head of investment banking at Pioneer Investcorp, used their networks in other cities to identify interesting names. Other veterans such as Vimal Bhandari, CEO of IndoStar Capital, helped us understand the community from the social and historical prism.   

Some of the people we have chosen are representative, often, of dozens of others in similar businesses. Mahaveer Lohiya of Lohiya Oils is one such: An edible oil trader who has slowly built a business brand through sheer chutzpah. He expects a turnover of Rs 1,800 crore this year. Traders such as him deal in dal, tobacco, timber (in the north-east), turmeric and just about any commodity you can think of, often doing business upwards of Rs 1,000 crore.

Others such as the Barwales of Mahyco  emphasise the use of successful partnerships with a large multinational (Monsanto in their case), even while operating in a very risky line of business.

There were many who we could not feature but they make for equally compelling stories. We hope to be able to share those with you later. But for now, here are five tales that were worth narrating.

Anurang Jain says, “Ups and downs of the past decade have also taught me a few hard truths”
Anurang Jain says, “Ups and downs of the past decade have also taught me a few hard truths”

Anurang Jain / 51
Founder and managing director,
Endurance Technologies,

Why He Matters
Starting from scratch in 1985, Jain has grown the company into one of the largest component suppliers to two- and three-wheeler makers in India. He also exports components for commercial and passenger vehicles to premier car marques Daimler, Audi, Fiat and Porsche.

The Endurance group now has 19 manufacturing facilities in the major auto hubs in India and subsidiaries in Germany and Italy.


Rs 3,853 crore in FY13 with margins of 4.5 to 5 percent. Top line grew by 10 percent in the last year, despite the downturn in the auto industry.

Starting Up

Inspired by maternal uncle Rahul Bajaj, Jain set up an auto components company, Anurang Engineering, with twin brother Tarang in Aurangabad in 1986. They started in the aluminium die-casting business, supplying mostly to Bajaj Auto. Aurangabad was a notified backward area at the time; consequently, it had great incentives including a 10-year sales tax break for industry. By the mid-’90s, the brothers decided to chart their separate course and Tarang split to form Varroc Engineering. Anurang changed track, moving to proprietary products in four main areas—suspension, transmission, braking and aluminium casting. He also began building his own tools and tied up with European companies for research.

Turning Points
Till 2004-05, Bajaj Auto was Anurang Jain’s company’s foremost customer, dominant by far. Moving to a more diverse clientele—thereby de-risking the business—became critical for Anurang. He did this by expanding—building new units at Manesar and Chennai to serve customers like HMSI (Honda Motorcycles), Bosch and Hyundai.

This was a period of rapid growth at the end of which Anurang Engineering was merged into the new Endurance Technologies, in 2006. Business also moved overseas with two European acquisitions. And there was venture capital interest with Stanchart PE taking a 13 percent stake in 2006 (Actis picked this up in 2011).

Turnover had scaled up to Rs 2,400 crore by 2009.

Hairy Moments
The slowdown of 2008-09 hit Endurance pretty hard. Business from global manufacturers such as Daimler and Audi reduced as luxury car sales dropped. A tough period was to follow. Jain had gone the whole nine yards in the previous few years, acquiring debt of close to Rs 900 crore. The aggressive growth had come at a very high cost. “Despite a decent turnover, the company made a book loss in 2008-09; the only way out was drastic financial control and discipline,” he says.

The next few years were marked by a painful scale back. The company’s net worth was wiped out and it had revalue its assets. Jain stopped all new investments, let go of loss-making businesses and re-aligned his company. For example, the plant at Chakan was shut down and all production was brought to a single location at Aurangabad. “Customer demand would keep growing and the only way to service it was to relentlessly improve quality through R&D,” Jain says. Through cut-backs and consolidation, he was able to bring Endurance back to black in 2009-10. Non-critical operations have been outsourced to third-party vendors. Endurance today does about Rs 150 crore of exports. “The mantra is to only take on business that brings in cash,” says Jain who is far more cautious now. An outcome of this prudence is that manufacturing activity is concentrated in fewer plants, and there is economy of scale in each unit. The strategy is to stay focussed on the two- and three-wheeler business which he says has fewer players and is more stable. About 80 percent of the group’s activity is in this segment. The European subsidiaries, on the other hand, cater exclusively to passenger car-makers. Bajaj Auto remains the anchor customer and accounts for about 60 percent of Endurance’s business in India. “I would like to diversify further but I also don’t want to lose out on any growth coming from Bajaj,” he says.

Being Marwari
Jain says that he has inherited his Marwari acumen—particularly, risk-taking—from his mother, who takes a keen interest in his enterprise. His father, a Jain businessman, has played a key role in helping him navigate the often cunning landscape. As young men, both brothers apprenticed with uncle Rahul Bajaj for 18 months at his Pune plant and were inspired by him too. “Ups and downs of the past decade have also taught me a few hard truths,” he says.

JP Taparia (centre)with sons Sanjeev (left)and Ashutosh
JP Taparia (centre)with sons Sanjeev (left)and Ashutosh

JP Taparia / 69 and Sons
Founder and chairman,
Famy Care, Mumbai

The company is now managed by sons Sanjeev (46) and Ashutosh Taparia (41).

Why He Matters
Started in 1990, Famy Care has grown to become one of the world’s largest feminine oral contraceptive manufacturers. The Taparias are also, globally, the biggest producer of Copper-Ts. In fact, about 15 percent of all women in the world who are on oral contraceptive pills consume Famy Care products.

About Rs 400 crore in 2013-14; the company is debt-free.

Starting up
Taparia’s extended family was in the hand tools and engineering business but he wanted to start something of his own. His inspiration was his grandfather, who had started off as a first-generation entrepreneur. Taparia says he saw opportunity in the pharma business. The government of India was, at the time, importing IUDs (intra uterine contraceptive devices) for the family-planning programme and, needless to say, in huge quantities. The potential was obvious to Taparia who then set up Famy Care in 1990. He began with a technology tie-up with Finnish company LierasOy. Later, in 1991, he started to rapidly indigenise the products and soon became the first Indian supplier to the Union health ministry.

His sons got into the business in 1996 and looked for opportunities beyond IUDs. Famy found a new niche in oral contraceptive pills, which were also in great demand from the government. Thus was born the seemingly ubiquitous Mala-D brand. As opportunities emerged, the Taparias began exporting the contraceptive to other Asian countries and Africa. Volumes grew and they quickly scaled up. In 2010, PE firm AIF Capital invested $40 million to pick up 17.5 percent in the company.

The strategy was clear: First injectable contraceptives, then moving into oral pills, and later condoms. The idea was to provide all the options.

Turning points
The first overseas supply contract from the United Nations Population Fund in 2001 provided a major boost. PE investment brought a professional edge to a family-owned business. A second line of managers is now in the making. Three independent directors have steered the company with a broader vision than that solely of the promoters. The company now has stricter audit processes and corporate governance.

Being Marwari
“Entrepreneurship runs in our blood,” says Sanjeev. “We’ve grown in a business environment and are constantly looking for opportunities to expand.” Taparia senior says, it is their risk-taking ability that sets the community apart. They have the willingness to trust their instinct and put in the hard-work needed to make their plans work, he says.

Future plans
To increase its presence in the US market. The Taparias are into Para IV litigation in the US courts (this legal recourse allows generics companies to introduce more affordable products, before the patent expires.), and expect to be able to introduce new brands in the market.

Sitting (L-R): Rajendra Barwale, BR Barwale and Usha Barwale
Zehr. Standing (L-R): Aashish Barwale and Shirish Barwale
Image: Hemant Parab for Forbes India
Sitting (L-R): Rajendra Barwale, BR Barwale and Usha Barwale Zehr. Standing (L-R): Aashish Barwale and Shirish Barwale

BR Barwale / 82
Maharashtra Hybrid Seeds Company (Mahyco)

The company is run by his children Raju Barwale (58), managing director and Usha Barwale Zehr (52),
chief technology officer.

Rs 800 crore (expected) for FY 14.

Why They Matter
The Barwales are recognised globally as India’s seed family. In the last 50 years they have helped millions of farmers boost their yields through improved seed varieties. Their efforts have contributed in no small measure to the growth in India’s agricultural production—distribution of high-quality seed is up 40-fold since the 1950s. The distinction won BR Barwale the World Food Prize in 1998.

Starting up
BR Barwale began Mahyco in 1964, though he was already in the seed business from the late 1950s. He started with two kilos of disease-resistant Okra seeds (Pusa Sawani) procured from an agri-exhibition in Delhi. At a time when India was grappling with drought and low food production, he was quick to spot the demand for high-yielding hybrid seeds. Over the years, he has worked with the Centre and state governments, agriculture universities and foreign collaborators, to broaden the research and production of such seeds. Mahyco today produces 350 hybrid seed varieties, including cereals, oilseeds, vegetables and fibre crops. Barwale started the contract farming of seeds since the company’s inception. Today over a lakh cultivators grow seeds for Mahyco. It has 15 production centres and about 2,500 dealers across India. In 1998, the Barwales established the Mahyco Research Centre near Jalna, Maharashtra, to conduct biotechnology research in crop improvement.

Turning points
Raju Barwale’s entry into the business catalysed its entry into transgenic food—the introduction of GM crops. Monsanto had been looking for an Indian partner for years. The US seed giant started by licensing the use of the Bt technology for cotton to Mahyco. In 1998, it paid $43 million for 26 percent stake in the Indian company. Mahyco-Monsanto Biotech, a 50:50 joint venture between the two companies, is currently the Indian licensee for Bt cotton.

Indian farmers were quick to see the advantage of using bollworm resistant Bt cotton seed within just a few years after its introduction. Rapid use of the seeds followed. About 95 percent of the total cotton crop in India is now GM. The impact on production has been immense and India has replaced the US as the second-largest cotton producer in the world. It has also become a net exporter of the commodity. “Bt cotton yields up to 500 kgs of lint per hectare, compared with 300 kg for the non-Bt variety,” says Barwale. Given the demand, Mahyco has licensed several other companies to produce these seeds.

Raju Barwale’s sons Shirish and Aashish have now joined the business. Shirish is looking at new business opportunities in Africa and Indo-Chine, while Aashish looks after Seven Star, a group company that is into fruit and vegetable exports.

Hairy moments
In February 2010, the ministry of environment and forests imposed a moratorium on the commercialisation of Bt Brinjal, until all concerns expressed by the public, NGOs and stakeholders were addressed adequately. Bt Brinjal is the first GM food crop in India to reach the approval stage for commercialisation. Mahyco was leading the trials and had hoped to repeat the success of Bt cotton with brinjal and other food crops. However, the Genetic Engineering Approval Committee, which had approved trials earlier, revoked its decision.

Being Marwari
“We are in the genetics business. And, through that, I realise that I have surely inherited some things, by being a Marwari,” says Barwale senior. The journey with the seeds business has been full of risks—first growing the seeds, and then marketing them to the farmer who will only buy it if he can see value in it. “I was able to absorb the risk, also because I looked at it as part of nation-building,” he says.

The understanding of the cost of money has been significant—knowing how much a Rs 50-crore loan costs, what it means if this loan is repaid to the bank a day early or one day after it was due.

“Along with wealth-creation, we have always been taught to look at philanthropy. We have tried to do this in a small way by setting up an eye-hospital, Shri Ganapati Netralaya in Jalna, which offers treatment to about 500 patients daily,” he says.

Future plans
There is still a huge opportunity to improve crop production in India, Barwale senior feels. “We can have the same benefits as cotton in other crops like chana and rice. India can turn from a chana importer to exporter if we improve our seeds.”

At Micro Labs, expenses are always based on actual rather than expected income. “Problems start for business groups who do not follow this rule,” says Dilip Surana
Image: Vivek Mathew for Forbes India
At Micro Labs, expenses are always based on actual rather than expected income. “Problems start for business groups who do not follow this rule,” says Dilip Surana

Dilip Surana / 48
Chairman and managing director,
Micro Labs, Bangalore

Why He Matters
Micro Labs is among the top 20 pharma companies in India. It is still 100 percent owned by the Suranas. It is in many ways representative of an entire class of family-run businesses that have been able to achieve scale without diluting equity.

Rs 2,500 crore in 2013-14 with profit of Rs 350 crore.

Starting Up
Micro Labs was started in 1973 by the late GC Surana, a pharmaceutical dealer who moved from Rajasthan to Bangalore a decade earlier. The first steps were to bring in new products from Europe as India then did not have a patent act. Much of the business was based in south India. This grew slowly, with plants in multiple locations (such as Karnataka, Goa, Baddi in Himachal Pradesh and Pondicherry) as well as through investment in research. Then, in the 1990s, Surana’s sons, Dilip and Anand, who is also a director, joined the business and have since helped grow it to its present stature.

Micro Labs is in the active pharmaceutical ingredients (raw materials) and finished formulations business with a marketing and distribution network in both India and overseas. Multinational pharma companies Pfizer and Mylan had made a play for it, but the deal has never materialised as the brothers are reluctant to sell out.

Business is divided between the brothers—Dilip focuses on the domestic market, while Anand manages exports which account for about 40 percent of the revenue, and this is expected to rapidly grow in the coming years. “International volumes will soon be bigger than domestic,” says Dilip. The group has notched a compounded average growth rate of 14 percent.

Turning points
According to Dilip, the group’s philosophy has always been “high quality, high price”. Micro Labs focuses on formulations, and not so much on bulk drugs. It sells branded products around the world, except in regulated markets like the US.

The Suranas are considered pioneers in India in speciality marketing and were among the first to create specialised business units (SBUs) focussed on different health problems. Micro Labs has 14 such divisions, which allows complete focus on research and marketing of molecules for the specific problem. There is a separate sales force and accounting team for each SBU as well.

Being Marwari

Though his business is far away from desh (home state Rajasthan), Dilip’s cultural identity is immediately obvious to anyone who calls him. His cellphone caller tune is a Marwari bhajan dedicated to Lord Adinath. “I spend a fifth of my time on religious activities,” he says and is well-connected to his village in Pali district, a 100 km from Jodhpur. The entire family visits Pali at least twice a year.

Keeping costs low has been the group’s mantra. Expenses are always based on actual rather than expected income. “Problems start for business groups who do not follow this rule,” says Dilip. Working on low costs means never being a high-cost borrower. The group bargains hard to get the extra 0.5-1 percent benefit from banks. Anand is the financial whiz in the family, and has often been able to figure out the best structure for borrowings.

Future plans
Sun Pharma founder and managing director Dilip Shanghvi is the role model for the Suranas. They hope to grow Micro Labs to a billion-dollar company by 2017. “The infrastructure is already in place,” says Dilip. “All we have to do is build on it.” They could even go public in four to five years if they require money for any big acquisition, he adds.

Mahaveer Lohiya says, “We understand business from birth. [The ups and downs of the business cycle] is all part of life”
Mahaveer Lohiya says, “We understand business from birth. [The ups and downs of the business cycle] is all part of life”

Kanhailal Lohiya / 66
Founder, Lohiya Edible Oils, Hyderabad

The company is now being run by his sons: Mahaveer Lohiya (43) along with his two younger brothers Kishan (36) and Venugopal (39).

Rs 1,300 crore in 2012-13, with a margin of 3 to 5 percent.

Why They Matter
The Lohiyas, who started as edible oil traders in 1987-88, have over the last 25 years built a business that straddles oil import, refining and marketing. Their oil brand ‘Gold Drop’ represents a shift from the commodity to the FMCG business. The product is a segment leader in many southern states. Lohiya Edible Oils, in a sense, is here as representative of the dozens of Marwari traders in the commodity business, who started as small regional players and have rapidly gone up the value chain to build businesses running into hundreds of crores.

Like several other trader families, the Lohiyas too are slowly professionalising the business by bringing in talent from MNCs and elsewhere.

Starting Up

They began with edible oil trading first in castor seeds; over the years, they moved into refining oil and vanaspati (ghee) and manufacturing of biscuits and puffs. Their branded sunflower oil, ‘Gold Drop’, launched in 1995, now competes with multinational rivals. About 60 percent of their sales are in the retail business, while the remaining continues to be in wholesale where they deal in cottonseed, groundnut and palmolein oils. Production from their three units is now at about 1,300 tonnes per day. They employ 500 people.

Edible oils is typically a localised business, and very few Indian companies have been able to achieve national scale. Logistics is the big barrier as moving the product is tough. The Lohiyas are currently in 10 states and are trying to use the railways to transport their oils to northern markets. One of their units is at Kakinada port, where raw materials are imported to.

Turning Points
Moving from loose (wholesale) oils to the branded business was first possible by improving the refining process and by buying Belgian technology. This brought their product quality on par with their rivals. They were also able to reduce cost and realise a better price for the oil.

From 2000 onwards, the Lohiyas plunged headlong into building their brand, signing up Telugu film star Jayasudha as the ambassador for ‘Gold Drop’. They also worked on various innovations in packaging and distribution. Once the brand was established, they were able to improve their returns. While wholesale product margins are in the range of 2 percent, on retail they are able to make around 5 to 7 percent.

Hairy Moments

The last year-and-a-half has been particularly tough because of the falling rupee. India is short on edible oil and much of the raw material is imported from Indonesia, Malaysia and even further afield in Ukraine. And the imports are dollar-denominated. “As the rupee slid from Rs 45 to Rs 55 and then further to Rs 65, we were caught with open positions,” says Mahaveer Lohiya. “We had never seen such a fall. Many smaller traders were finished, and there was very little that we could do,” he says. Fortunately, the group had some cushion because of the retail margins.

Being Marwari

“We understand business from birth. Often, I see businessmen from other communities dealing with the ups and downs of the business cycle with great tension. For us, it is all part of life,” says Mahaveer. A Marwari business person is also known for their capability to take all these pressures, he says. “It’s something we see as kids. My children, who have degrees from good universities, have seen this and they will follow me into business,” he adds.

The other inevitable strength is being able to maintain a low cost of operation. “We have a better control on price than the MNCs. We also use SAP and other tools for better management. But cutting costs comes easily to us,” he says.

Future Plans

They are planning to expand production by adding units as well as by marketing in more states. “We will continue to depend on banks for borrowing,” says Mahaveer. There are no plans for an IPO or bringing in external investors.

(This story appears in the 21 March, 2014 issue of Forbes India. To visit our Archives, click here.)