for his never-say-die spirit in business. His company has emerged the preferred bidder for the biggest overseas acquisition by India Inc. And Venugopal Dhoot, the man at the centre of it all, gives full credit for this to a battlefield scripture that he knows by heart. "Lord Krishna's answers give you mental stability and focus," Videocon's chairman says, and then proceeds to deliver an impressive spiritual discourse "" a lucid interpretation of the Gita, never once faltering or groping for a text.
We are at Handloom House, the Rs 7,000 crore-consumer durables company's headquarters in one of the countless dark alleys in South Mumbai. Dhoot had agreed to accept our invitation for "Lunch with BS" on the condition that the venue is not a "boring" restaurant but his office. The grandeur of the Hafeez Contractor-designed conference-cum-dining hall can easily give any five-star hotel a run for its money, and the vegetarian dish comprising pulao, rotis, dal and potato curry, tastes much better than the standard five-star fare.
Dhoot was known, till recently, for being generous in sharing details about Videocon's ever-expanding footprint. Not any more. The two words that take the pride of place in his vocabulary these days are "non-disclosure agreement." Quiz him on this, and Dhoot flashes his trademark smile to say that his "lips have been sealed" ever since Videocon came within striking distance of Korean chaebol, Daewoo Electronics, and the resultant stiff confidentiality agreement. What about his acquisition plans in the US about which he was quite vocal a couple of months ago? The reply comes fast "" "non- disclosure" "" and Dhoot gets an approving nod from his Man Friday S K Shelgikar who is also Videocon's director.
He wastes no time in going back to is favourite topic and says the Gita is responsible for his never-say-die spirit. In 1987, he had gone to the Akai office in Japan with a proposal to assemble its kits in India. But the proposal was rejected on the grounds that no Indian company had the technological bandwidth to do this. Never one to take things lying down, Dhoot worked through the night with one of his assistants and went back to the Akai office a day later with a fully assembled TV. The officer refused to believe him at first and said that the TV must have been bought from the market but was satisfied only after intensive investigation.
The contract was his 24 hours later, and Videocon has never looked back since then. "I was the first to see the huge benefits of the combination of our cheap labour and their technology," Dhoot says. Today, Videocon distributes, markets or manufactures almost all top global brands in India "" Sansui, Akai, York, Kenstar, Hyundai, Toshiba, and now Electrolux and Kelvinator.
Like his favourite character, Arjuna, he has traversed a long distance since then. The $700 million bid for Daewoo came barely a year after Videocon acquired the TV tube operations of France's Thomson for $291 million and the Indian unit of Swedish firm Electrolux for $76 million. Where is the money coming from? Dhoot doesn't say much because of "non-disclosure", but the past may offer some clues. The Thomson and Electrolux deals didn't involve much cash outgo (Dhoot calls it "performance arbitrage") as both the companies picked up equity stakes in Videocon; while the group's domestic sales continue to be robust, nearly half the company's turnover comes from overseas sales; and the Ravva oilfields in which Videocon has a 25 per cent stake is giving him a cash flow of Rs 600 crore a year.
With the acquisition of Thomson and Electrolux, Dhoot's company now has footprints in Mexico, Poland, China and Italy, and is also the world's third largest colour picture tube (CPT) maker after LG and Samsung, with a manufacturing capacity of 24 million pieces per annum. Dhoot says the Gita has also taught him to plan all his moves meticulously. For example, the Thomson acquisition has also given the group a foothold in Mexico, with a CPT capacity of 3 million, which helps it to service the US; the China plant can feed the Asian markets, while Poland can take care of Europe.
But what about the criticism that he has acquired the TV tube unit at a time when the world is moving towards LCD or plasma TV? Dhoot says he is betting on the fact that the demand for plain-old cathode-ray tubes (CRT) will be huge at least for the next 15 years. As long as LCD and plasma prices are twice as expensive, the market share of CRT cannot come down below 75 per cent. "A technology, which has survived for over 60 years, can't die so soon," he says.
The dessert "" a generous helping of ice-cream and fruits "" look inviting enough, and Dhoot says there are two high points in his life. The first was when his father "" a wealthy farmer "" didn't think twice before bankrolling his plans to launch Videocon. "At that time, cable TV wasn't there, and having a "video" was a big deal in a middle class home. I wanted to grab this mind space," Dhoot says. The other high point was acquiring Thomson, which has a brand called Videocolour "" the inspiration for the name Videocon. "It's a great feeling to be able to buy a brand which I and my two brothers admired so much at the beginning of our career," Dhoot says.
The domestic ventures are also doing fine and the Videocon chairman is lavish in his praise for Chief Minister Buddhadeb Bhattacharjee. Dhoot is planning a host of special economic zones in West Bengal, and says what he likes is the red carpet treatment the CM gives the industry. "Every time I go to Kolkata to meet Mr Bhattacharjee, a pilot car waits for me at the airport. That makes you feel special," he says.
As he guides us to the lift, the man who has acquired businesses all over the world, says his favourite getaways are Kedarnath and Badrinath. And when he isn't reading the Gita during his free time, he plays the flute "" an abiding passion ever since he got a standing ovation at his college function. Lord Krishna would approve.
