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Born to business, then had to start afresh

H S Singhania joined the family business in Kolkata in 1951, aged 18

Bhupesh Bhandari  |  New Delhi 

Hari Shankar Singhania led a diversified group that had interests in tyre (JK Tyre), paper (JK Paper), cement (JK Cement and JK Udaipur Udyog) and fanbelts (Fenner), with annual turnover of Rs 11,000 crore. On his radar screen next were defence hardware and power.

Singhania, who lived in a spacious bungalow on expensive Prithviraj Road with nephew Harshpati Singhania, was also a philanthropist, a spokesperson for the industry and patriarch of the extended Singhania family. He was the force behind JK Organisation, of which any Singhania company could become a member and use the hammer-and-hand logo, provided it met certain benchmarks in ethics, values and integrity. Some would criticise him for getting a family member to lead each company but he would often say that the “family has turned professional and it is possible for outsiders to reach the top-most slots in the group”.

Singhania joined the family business in Kolkata in 1951, aged 18. The Marwari family traces its roots to village Singhana in the Shekhawati region of Rajasthan. Perturbed at local lawlessness, the Singhanias moved east in the 19th century, to Farrukhabad and then Kanpur. They made their riches as the sole selling agents for large Kanpur clothmakers such as Elgin Mills, Cawnpore Cotton Mills and Victoria Mills. They got into cloth production after Mahatma Gandhi called for a boycott of foreign cloth in the 1930s.

Lakshmipat, Singhania’s father, moved to Kolkata in 1942. He set up Aluminium Corporation of India near Asansol, India’s first aluminium producer. He acquired National Insurance Company and Ganges Manufacturing Company, India’s largest jute mill. When Singhania joined the business, the family was among the top industrial houses in India. J K House at 12, Alipore Road, Kolkata, had become a prominent landmark.

Things ran out of control in the 1960s, with militant trade unionism. “The work atmosphere was vitiated. Productivity was hampered by political interference,” Singhania told Business Standard 18 months ago. Businessmen fell out of favour. “Once we were sitting in our office in Kolkata, when my father got a phone call that our works manager (of Aluminium Corporation of India) was being beaten mercilessly at the factory gate. This had gone on for two hours and the police hadn’t come. I was sent to Writers’ Building (state government headquarters) for help.”

He first met Chief Minister Ajoy Mukherjee (of the Congress) who asked him to see Deputy Chief Minister Jyoti Basu (of the Communist Party of India-Marxist). “He knew what was happening. But, he said, your information is wrong that your works manager is being beaten up — I have evidence to show that he is beating so many workers. I was aghast. I said to him the works manager was the best technician in India, please don’t kill him. Let them also not switch off the power supply because it takes a lot of time to restart the aluminium smelters. He was very unhelpful and put the entire blame on us.”

The inevitable happened. The workers switched off the power and the plant was closed. “For a few months, our top officers in the township of JK Nagar lived on their rooftops because everything was looted,” Singhania said. There were persistent demands for nationalisation of Aluminium Corporation of India (and Indian Iron and Steel Company) — which finally happened in 1974. Lakshmipat, upset over the nationalisation of his insurance company in 1956, was heartbroken at the way things were going in West Bengal. So, in 1970, he advised Singhania, his eldest son, to relocate to Delhi and start afresh.

Thankfully, the family had interests outside West Bengal — a paper mill in Odisha, a straw board factory in Bhopal and manganese mines in Madhya Pradesh. Delhi certainly wasn’t Kolkata. And, business wasn’t easy — it was the licence raj and businessmen were looked at with suspicion. Core competence lay in securing licences. Singhania began to scout for opportunities.

“My father asked us to collect every morning reports from Bombay, Calcutta and Madras ports on what was being imported and then decide on what to produce. It showed everything was being imported,” Singhania remembered. He happened to mention to Mohanlal Sukhadia, chief minister of Rajasthan, that he wanted to make tyres. Sukhadia said he could do that in his constituency of Udaipur. Backward-area benefits were also thrown in. Singhania collaborated with General Tire of the US for technology and the factory started in 1977. “We became the first producer of radial tyres in the country in 1977. All foreign tyre-makers like Dunlop, Goodyear and Firestone came to me and said please don’t do this — there are no cars and no roads for it. Still, I went ahead, and today, we are the largest producer of truck radials,” he said.

Cement, sugar, seeds and dairy product businesses got added over the years. The group also had a pharma business, later sold to Israel’s Teva. The next turn came in 1991, when the licence raj was dismantled and the economy opened. Singhania came to be associated with the Bombay Club, an informal association of businessmen who wanted their interests protected. He said the Club was not against reforms. “Some of us at that time thought a very good thing has happened but it can be more effective if a few other things are done. The paper we submitted to Manmohan Singh (then finance minister) didn’t use ‘protection’ even at one place. We said we welcome reforms but they should be widened.”

It didn’t affect his stature in New Delhi. P V Narasimha Rao, then prime minister, asked Singhania if he would like to be India’s ambassador to the United States because he was active in international business forums (Singhania was vice-president of the International Chamber of Commerce in 1992, and became its president in 1993). He had to turn down the offer because his wife was not well and he didn’t want to leave her alone.

First Published: Mon, February 25 2013. 00:38 IST