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To Be or Not To Be

Ranbaxy Lab made Bhai Mohan Singh famous and very wealthy. Unfortunately, his heart was not in it

Bhai Mohan Singh, the Delhi-based business patriarch, who passed away in March, was a reluctant industrialist. His main forte was real estate and finance, not manufacturing, but fortunately or unfortunately, that is what he was forced to do, once the die was cast.

Fortunately, it was his manufacturing company, Ranbaxy Laboratories, which made Bhai Mohan Singh famous and also very wealthy. Unfortunately, because his heart was not in it.

Bhai Mohan Singh had lent money to Ranbaxy's original founders, Ranjith Singh and Gurbax Singh, who ran a small pharma outfit in Punjab.

When the company failed, Mohan Singh, or Bhaisaab as he was universally known, had to take over the venture, most unwillingly as he had lent them a lot of money.

Bhaisaab brought the company to Delhi, where to his great surprise, it flourished and outgrew its size in original location. He was then forced to take the company public.

When Ranbaxy Laboratories went public in 1973 or thereabouts, at the height of the stock market boom, Bhai Mohan Singh found he had also acquired 25,000 shareholders, something he had not bargained for and very few of those shareholders had owned shares before.

The issue was oversubscribed twenty times and the shares were selling like hot cakes.But most shareholders could not get more than 25 shares though this entitled them to attend the company's annual general meetings.

At the first annual general meeting, held at Delhi's Imperial Hotel, a few furlongs from Connaught Place, the small hall was bursting at the seams, as Bhaisaab and his fellow directors - for most of whom it was also their first AGM - watched uneasily.

The shareholders were not happy with the dividend of Re 1 per share. There were no freebies except a cup of coffee and biscuits and the shareholders, to put it mildly, were not amused.

That was the moment of truth for Bhaisaab, and he wondered, a little too loudly, whether he had done the right thing by taking over a business for which he had no stomach. It was not the company he was worried about; it was the shareholders, who were always asking for more.

Eventually, the registered office of the company was moved to Mohali, where the company's main plant was located. At the next annual general meeting at Mohali, there were just enough people for a quorum and the old Imperial Hotel fraternity was left behind in Delhi poring over the fine type in the company's annual reports.

The company kept growing, of course, but nobody - not even Bhaisaab - could have anticipated its extraordinary growth over the years -from just about a crore of rupees turnover at the first annual general meeting to over Rs 5,000 core at present. A great deal of credit for this is due to Bhaisaab's elder son, Parvinder, who pushed it forward. His untimely death was a severe blow to Bhaisaab as well as Ranbaxy Laboratories.

How do I know all this? I had a ringside seat to Ranbaxy's annual general meeting as my company was the compay's registrar and share transfer agent for several years!