Newsmakers of 2007

Men of mettle

The poster boys of the corporate world are either driving or funding billion-dollar investments.

Akhil Gupta
A very late entrant into India, private equity player Blackstone seems to be making up for lost time. Indeed, the fund which manages about $80 billion in assets worldwide, seems determined not to lose out on any action in India.

This year, it bought into a clutch of companies investing a total of about $850 million. Akhil Gupta, managing director, Blackstone Advisors, India, is known to be sold on the India story, much like his peers in the PE fraternity.

But unlike many of them, he's been extremely sector-agnostic; his portfolio in India is a mix of media, construction, textiles, engineering, pharmaceuticals and information technology sectors.

One would think Gupta wants an in-built hedge in the portfolio. He doesn't seem to be worried about the fairly stratospheric valuations that have prevailed this year; the Blackstone India chief claims that valuations are not high when compared to the growth potential that the companies have.

Moreover, Blackstone, he maintains, is a long-term player and even if there are disruptions in the growth cycle, there's no real problem for the next 5-7 years.

That may be quite so. Gupta's surprise pick this year has been Gokaldas. At a time when textile stocks were almost untouchables, it was surprising to see someone backing a textile firm.

But then, Blackstone is a value-added player and surely has a plan in place. Gupta has also backed one of the few management buyouts in this country when he supported the move by the management of the BPO firm Intelenet to buy out the firm from the previous owners.

His biggest investment of $275 million in Ramoji Rao's Ushodaya, however, is still to be cleared by the government. By now, Gupta must have learnt to live with the ways of the Indian government.

Vijay Mallya
From fast cars, designer houses to horses and jewellery, he has it all. "I work hard and I party hard," Vijay Mallya often says.

In 2007, however, the 52-year-old UB Group chairman worked really hard. He showed that while he may be a winner on the racing track, he has a nose for business too. In May, the Rajya Sabha MP, snapped up scotch maker Whyte &Mackay for £600 million.

In the airline business, he first bought a 26 per cent controlling stake in the low-cost carrier Deccan Aviation, and later planned to merge the airline with his own Kingfisher Airlines.

That's two big deals which will help him consolidate his position in the liquor and aviation businesses. In mid-2005, Mallya bought out Shaw Wallace from the Chhabria family and plans to merge it with United Spirits which is the third largest distiller in the world today.

Mallya, who took over the reins of the business from his father Vittal Mallya in 1983, has taken time to build his empire. However, he's done a great job with the liquor business which now looks to be on firm ground, especially, with the addition of some marquee labels from the Whyte & Mackay cabinet.

However, the aviation business is still shaky given that the combined losses of Deccan and Kingfisher are in the region of Rs 2,000 crore and also because the operating environment remains a difficult one.

Mallya's on the right track and his ability to keep his people "" the core team has been with him for years now "" is enviable. But he's up against some formidable rivals and needs to quickly convince investors to back his plans. If he manages to turn around the merged airline, he will have proved his mettle.

Vikram Pandit
He is one of the best minds in the business, but Vikram Pandit, many believe, may not be the right man for the top job at Citigroup.

He was appointed chief executive of the world's largest financial services company earlier this month. But the low profile Pandit, who worked with Morgan Stanley for 22 years, might just pull it off.

For one, his conservative approach may be just what the doctor ordered for the troubled Citigroup "" some amount of risk averseness may not be such a bad thing after all in an environment that is threatening to get worse.

And if he's convincing and charming enough with his team and clients, that's all that's required; his job, right now, is not to please analysts by appearing overconfident.

At 50, Pandit, who left India at the age of 16 to study at Columbia University, also seems to be at right age to set the Citigroup house in order, neither too inexperienced nor jaded.

More than experience in retail financial services, which contribute more than half of the group's profits, what's called for now is a leader who can take a more holistic look at the business and perhaps even reshape it to make it less vulnerable. His detractors could say that great thinkers don't always make for good administrators.

But then Pandit couldn't have run the equities business at Morgan Stanley for such a long time without having taken some crucial decisions. And neither perhaps would he have been hired to head Citigroup's investment banking division.

True, the job at Citigroup is much more challenging than anything Pandit has ever handled; he has, after all, never run such a large operation. He's also never been the quintessential relationship banker and is more of a numbers man.

But some fresh blood, new strategies and a little less aggression is, perhaps, what Citigroup needs today.