The ascent of the Marwari eco-system

<i>Bringing the Rainbow</i> is a good insight into the mind of a Marwari businessman

Bringing the Rainbow

R K Somany

Rupa

199 pages; Rs 595

Bringing the Rainbow is not a potboiler. But then, R K Somany, whose HSIL (owner of the Hindware brand) is the largest player in sanitary-ware with a market share of 40 per cent, has never been involved in headline-grabbing controversies: Takeovers, family feuds et al. Yet, a careful reading of his memoirs throws light on some key aspects of family businesses in India, especially how the Marwari eco-system works.

Like hundreds of others from his community, Mr Somany’s grandfather, Ram Prasad, left his home and a thriving moneylending business at Chirawa in arid Rajasthan in 1905-06 to seek a better future in Calcutta, as Kolkata was known then. He got into the trading of opium (it was legal then), raw jute and hessian. Within 10 years, he had made enough to start a school at Chirawa.

The family’s ascent is a reflection of how the Marwaris made a mark in trading in the first half of the 20th century, often riding piggyback on the community network, and from there graduated into manufacturing.

For the sake of business, Marwaris readily make sacrifices. Murlidhar, Mr Somany’s father, suffered a heart attack in 1932, which left him very weak. Thus, in 1936, he asked his eldest son to give up studies and take up business so that his siblings could be looked after. Though still in his teens, the lad was admitted as a member of the Calcutta Stock Exchange on the basis of his family’s reputation. His entry was facilitated by fellow Marwari RK Bangur, the doyen of Lyons Range at that time.

During World War II, commodity prices, including jute and hessian, went up sharply, and the Marwari traders of Calcutta amassed a sizeable fortune. The Somanys too benefited and came to control as much as 99 per cent of the gunny market in Karachi. The reputation of the family began to rise, often leaping ahead of its actual business.

From here, the family first bought a small engineering outfit and then set up a company called Somany Glassworks. This was its tryst with manufacturing. The family also acquired RB Rodda & Co, the largest gun merchant in the east.

During the Partition riots, a well-dressed man came and bought 2,000 rounds of ammunition from Rodda. It was Amiya Nath Bose, nephew of Subhash Chandra Bose. The Somany family, which lived close to a Muslim neighbourhood, had stocked 5,000 rounds at home to defend itself in case it came under attack.

Soon after Independence, when Vallabhbhai Patel was in the process of annexing the princely states, the Somanys received an urgent missive from Ghanshyamdas Birla in Shimla. The armed forces were preparing for action in Hyderabad but had run short of ammunition; could Rodda supply the required quantities? The Somanys, who had by now made excellent contacts with ICI, agreed.

Mr Somany started his career in business with Rodda. He had a flair for mechanics and was soon able to fix problems in guns on his own. In 1957, when he was all of 20, Mr Somany was encouraged by his brothers to think of a new manufacturing venture. After much deliberation, he settled for sanitary-ware made of vitreous China, which was an improvement over the earthenware China products then available. The naysayers said such sanitary-ware would be too expensive for India. But Mr Somany stayed the course.

Once again, the family entered a sector of which it had no experience. This is what Marwari enterprise is all about. It was perfectly possible for Mr Somany to thrive in the family business but the trait of exploring uncharted territory overpowered all inhibitions. For the factory, he chose Bahadurgarh on the outskirts of Delhi and relocated there, leaving the comforts of Calcutta behind. Mr Somany tied up with Twyfords of England for technology. Thus was born HSIL.

The Somany brothers collectively owned all the businesses, though each handled a separate company. Mr Somany realised this state of affairs could not last for long, especially when the next generations got into the business, and thus initiated an exercise to separate out the holdings. The process proved far from simple and led to a fair share of acrimony, which Mr Somany recounts with all honesty.

Mr Somany suspects one of his siblings provoked the Haryana sales-tax department to raid his office in 1975 and take away all the books of accounts. As the department refused to return the books, HSIL was likely to miss the deadline to publish its statutory accounts, which would have triggered a serious penalty. Mr Somany fought it out in the courts, got the books and put out the accounts before the deadline. This is a good example of how the Licence Raj was open to manipulation, often to settle personal scores.

Businessmen are known to be cautious people. They hide far more than they tell, haunted as they are by the fear of retribution. Mr Somany writes with rare candour, which is refreshing. This includes the mysterious deaths of his first and second wives. Read the book also to learn how kids from different communities would interact in Calcutta’s public schools. Bringing the Rainbow is a good insight into the mind of a Marwari businessman.