The Best in Business

According to popular perception, Marwaris top the list of business communities in India. There is nobody to beat the Birlas and the Goenkas, not to speak of the Laxmi Mittals. But, says a new study, this perception has no basis.

Actually, there are no tops and bottoms among the leading business communities, who are more or less on par with each other. If you take the top 200 companies in the BSE list, each one of the groups accounts for 8 to 10 per cent of the total market cap. And at the moment, it is not Marwaris, but Gujaratis who are at the top.

There was a time, just after independence, when Tatas and Birlas overshadowed all the others. Between them, they accounted for more than 50 per cent of the total industrial activity in the country. But things are different now. Communities who used to shun business, like South Indians, have turned out to be as quick on the draw as any others. The South Indians and the Punjabis now also have a 10 per cent share each in the national business pie.

In Bombay, there used to be two camps, one led by the parsis, which meant Tatas, and the other by the Gujaratis, led by no particular business house. Tatas were supposed to be close to the government - British government, that is - and the Gujaratis were close to the Congress. After all, Gandhi was a Gujarati, though he was actually much closer to Ghanashyam Das Birla, who financed his several ashrams.

For several reasons, the Gujaratis of Bombay, that is, western India, have not managed to do as well as Tatas, with the sole exception of Dhirubhai Ambani, whose empire now towers above everybody else, including Tatas. Dhirubhai always measured himself against Tatas and kept a chart on his table, which showed when he would overtake him.

I used to tease him about it but he always said he would do it one day. In fact, in course of time, he not only overtook Tatas but charged past them at such great speed that his empire was nearly thrice as big as Tatas' when he died. Which is why the Gujaratis now outdo everybody else in the corporate stakes.

It so happens that most old Gujarati business families have now fallen by the wayside. One doesn't hear much about Mafatlals, once the second richest, after Tatas. Nor, for that matter, the Thackerseys, a gentlemanly lot, who owned three cotton mills in Bombay and several chemical factories, including one that was managed by Vijay Merchant, the cricketer. They have all closed down.

The big surprise in the list are the Punjabis who were nowhere in the big picture before independence. When Bhai Mohan Singh of Ranbaxy Laboratories came to live in Delhi after partition, his father was a small-time contractor and moneylender, and financed the owners of Ranbaxy at the time. When the business failed, he was most reluctantly forced to take over the ailing company which even when it went public in 1972 had a turnover of less than a crore of rupees.

His son, Parvinder Singh, turned it around and made it what it is now, with a market cap of Rs 12,000 crore, bigger than that of Bajaj Auto. This is also true of Mittal's Bharati Telecom and Hero Honda.

The South Indians are new comers, like the Punjabis, but there are not many of them. And where would they be without the redoubtable Narayanamurthy and his golden goose known as Infosys Technologies?

What will things be like ten or twenty years from now? Watch this space.

This article was originally published on November 30, 2005.