The other D of D-Mart and the cloak of reclusiveness

Damodar Mall talks about early days in Navi Mumbai, when first store started in 1999

The Initial Public Offer (IPO) prospectus of Avenue Supermarkets, parent of the D-Mart retail chain, does not mention his name. But, when the D-Mart brand was a toddler, it had not one but two Ds holding its hands. One was Radhakishan Damani, ace stock market investor and promoter of Avenue, along with a host of family members and group entities.

However, back in the 1990s, he was not a high priest of organised retailing. That was where the other D came in. Damodar Mall, then in his 30s, had an ideal career. With an IIT/IIM education and a Hindustan Unilever job, his life was set. But, he had other ideas.

In a recent blog, in an extract from his book, Supermarketwala: Secrets of winning Consumer India, Mall, now chief executive, grocery at Reliance Retail, explains the D-Mart story. He talks about the early days in Navi Mumbai, when the first store started in 1999. (Read here)

“Born to be a grocer’ has a different meaning for me. After the traditional career track of IIT/IIM and Hindustan Unilever, I was going to be a grocer, much to my family’s disbelief. Selling ‘daal-chhawal’ as a chosen vocation for the educated son was not their idea of smart choices,” reads the intro to the Forbes blog. Some people in financial circles remember Mall’s key role in those early days.

So, how could the D-Mart prospectus not refer to Mall, who seems very much part of the D-Mart story? There is a small reference to a company called Koop Consumer Services in the prospectus, while describing Damani’s profile. “He founded Bright Star, one of the promoters of our company, in the year 1989 to carry out the business of dealing and investments in securities and subsequently diversified his business in the retail industry through Koop Consumer Services Pvt Ltd in the year 1999. Pursuant to the scheme of amalgamation, Koop Consumer Services was merged into our company.” Koop was amalgamated in 2004 into Avenue, the current holding company, the prospectus said.

What it does not say is more interesting. Incorporation documents of Koop, dating back to December 1998 and filed with the registrar of companies, showed Mall and Damani held one share each at this point, suggesting a 50:50 venture. With the company no longer existent, there are only two other annual returns, pertaining to 2001-02 and 2002-03, available.

By September 2002, the shareholding of Koop Consumer was like this. Mall had 15,000 shares of Rs 100 each, while Damani’s holding had swelled to 135,000 shares, making it a 10:90 partnership. Beside the duo, one Girdhardas R Daga was also on board.

On March 11, 2003, Mall sold his holding to Kiran Devi Damani, wife of RK’s brother, Shiv Kishan. Eight months later, the process of amalgamation of Avenue, Koop and a couple of other group firms would be set on roll. Was there a nice takeover drama there? Will Mall blog about it? Will one of RK’s mouthpieces let us know?

Stock market reporters have grown fond of referring to Damani as a ‘recluse’. Few have spoken to him; not many have seen him. While this might be clever branding for an investor or a broker, the title doesn’t sit well on a promoter of a listed company. As he raises public money, investors would like to know the person more. From the prospectus, we know he is a BCom first-year pass, who lives in Altamount Road, Mumbai.

He needs to be seen more and heard more. To paraphrase the promoter of another great company that raised money to the delight of many investors, “In God, we trust; everybody else (must) bring data.”