United Spirits’ CEO Anand Kripalu has spent over four years in sustaining as well as growing the company in its most turbulent period. In an interview with BusinessLine, Kripalu states that his medium-term goal is to achieve double-digit topline growth and mid-to-high teen operating margin. Excerpts:

During the recent investor call, you said the company is more confident about the current health and the future of this business. Considering the fact that there have been constant policy changes, where does that confidence arise from?

The confidence comes from the fact that our P&L is healthier than before and all lines are moving in the right direction. Our gross margins have improved because we have been able to maintain costs and our interest costs have also come down. While our top line growth has been muted because of regulatory changes, which I hope are largely behind us, there has never been a question about longer term demand opportunity or category growth.

What is Diageo telling you now that most of the major issues including GST are behind you?

The relationship we have with Diageo is a two-way relationship. Diageo is pleased with what we have done so far, how we have managed the past and the steps we are taking to build the future. I think the mandate from Diageo is that India must be one of the top growth contributors for the company globally. And our growth and margin guidance to the markets is in line with that.

Will at some point in time United Spirits' name be changed to Diageo?

We are already Diageo in terms of the face of the company with key stakeholders.

We have migrated to Diageo e-mail IDs, integrated with key Diageo operating platforms like shared services, knowledge sharing etc. But the legal entity transition, which is complex will take time.

This change is not just about the name. We are also driving a cultural shift within the organisation. For example, today, about 25 per cent of our top 50 managers are women. We have our first woman as a head of a factory. And there are a lot more female colleagues leading other critical functions.

Will there be an increase in Diageo's stake in USL. Are you looking for more acquisitions?

I am not authorised to answer that question. Nor do I know. As far as acquisitions are concerned, our portfolio is very comprehensive. So if there is an opportunity, we will surely explore it. But we are not actively looking for one.

As you continue to re-organise yourself, are you also letting go of employees?

We are certainly more leaner and agile today than before. When we started the journey, we had just under 3,000 white collar employees, and now we are just over 2,000. That is a significant change. We have also rationalised our manufacturing footprint - to 58 sites, down from 94. We, however, continue to invest in upgrading our factories to get them to Diageo standards.

Are you satisfied with what you have done so far at USL?

My aim is to leave behind a legacy. A company which will continue to grow and with a reputation that we can be proud of.

We also need to work harder with the government to shape the industry and minimise short-term setbacks. We also want to deliver more consistent performance, including getting to double digit growth. I am also proud of the change we have driven internally in terms of culture and diversity. When I look back, every aspect of the company has been transformed. We have created the runway. Now we need to use that to accelerate and take off.

USL had sought to recover ₹1,300 crore which was given as a loan to UB Holdings whose chairman is Vijay Mallya. How much of it have you recovered so far?

As management, we spend most of our time today on the present and the future.

We are trying to monetise non-productive assets but those are the only key things of the past that we are focusing on.

Otherwise, we are looking ahead. As far as loan recovery is concerned, every creditor is standing in line and we are also in the queue to recover our loan.

Will you continue to invest in RCB?

We will continue to focus and stay invested in RCB.

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