From village bylanes to conquering the skies

GM Rao | Updated on January 27, 2019

I was born in Rajam village in Srikakulum district in Andhra Pradesh, in 1950. My father traded in jute, pulses and oilseeds. After my engineering studies, he wanted me to take up a job. I joined the Public Works Department, but since it did not enthrall me, I quit, returned to my village and joined my brothers in the family business. I gradually understood the fundamentals of the business, negotiating and dealing with farmers. This was the beginning of my entrepreneurial journey.

Alongside that, I ventured into manufacturing. Those were the days of licence raj. I came to know of a jute twine mill in Chennai, which had a licence but was sick. Given the availability of raw materials in my village, I decided to buy the unit. I purchased the machinery, shifted it to my village and had the licence transferred. In the very first year, the project was profitable. The early success gave me self-confidence.

I diversified rapidly. I got a brewery licence and a sugar factory licence, acquired another jute mill, started a ferro alloys unit, rolling mills, ventured into earbuds manufacturing, and so on. I started almost 28 businesses and became a ‘serial entrepreneur’.

Then came a defining moment in my life: I was nominated as a Director in Vysya Bank. I reasoned that as had happened in the West, the banking industry would be critical for the economy, and so I gradually increased my shareholding in the Bank and became the major shareholder. I turned around the bank with innovative measures: introducing core banking solutions, reducing large NPAs, developing a meritocratic culture, bringing in Bank Brussels Lambert with international experience as a shareholder on the bank’s board.

Bank Brussels Lambert was later acquired by ING, and so the bank became ING Vysya Bank. Since, I had turned around the bank and improved operations and governance processes, I was made its Chairman.

Along the way, I ventured into the infrastructure business. With economic liberalisation in the early 1990s, the government opened up power generation to the private sector. There was an opportunity to build a 200 MW power plant in Chennai at ₹800 crore. I brought the world’s best technology and completed the project. Subsequently, I set up a barge-mounted power plant in Karnataka.

At this stage, my sons and my son-in-law joined me in the business, and together we strategised. We were running many unrelated businesses, so we decided to focus on infrastructure. I divested all other businesses.

In the late 1990s, the opportunity to build the first country’s greenfield airport – in Hyderabad - on PPP model came. Given the importance of airports for growth, I took up the challenge and bid for it. Since we were new to the airports business, we formed a core team and travelled globally to learn form the best airports. I brought in global experts. On the strength of our willingness to learn. our attitude of embracing change and adapting quickly, we built a world-class airport.

Simultaneously, we got into highways and won two projects. We were the first mover in building national assets: it was a first for the Group, the industry, and the country.

In 2005 came the opportunity for the Delhi airport. It was a challenging experience: the heavy passenger and airline traffic could not be interrupted as we went about constructing the domestic departure Terminal 1D and the giant Terminal 3, the world’s 8th largest, which we built in a record 37 months against the typical 70-80 months.

When we took over Delhi Airport, it was among the world’s ten worst airports. Today, it is ranked the best in service standards in its category.

After our successful foray into the airports sector, we went international with projects in Istanbul, Maldives, and Cebu (in the Philippines). Recently, we added two more airports: Goa and Crete (in Greece). We are also the highest bidder for the Nagpur airport and are awaiting the Letter of Award. Today, we are among the top three private airport developers in the world, serving more than 100 million passengers globally.

I’ve always believed that our work should not only add economic value but also contribute towards social value. That mindset has helped me build the national assets which contribute significantly to social and economic growth. According to a recent study by NCAER, the Delhi Airport contributes 18% to Delhi State GDP and 0.7% to the national GDP. And it generates more than 28 lakh jobs - direct, indirect and induced.

When I look back at my journey from trader to manufacturer to banker to a leading infrastructure developer who has created more than $10 billion worth of infrastructure assets, I owe this succes to our ‘value’ system.

The future is exciting and today is just a beginning. With eight new airport bids in the next few months (seven in India and one in Europe), there are opportunities galore. We have created a unique platform of airports with very differentiated competencies and capabilities; we will be taking this globally.

The author is Founder-Chairman of the GMR Group

Published on January 27, 2019

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