When G M Rao, the media-shy chairman of GMR Infrastructure, pledged his entire personal stake of Rs 1,540 crore in the company, it did not surprise many. But the timing did. It coincided with Warren Buffett’s India visit to encourage rich Indian businessmen to donate part of their wealth for philanthropic activities. GMR Group officials say it is the culmination of years of effort from Rao and was not planned to coincide with Buffett’s visit.
Rao has been quite active in philanthropic activities for quite some time through GMR Varalakshmi Foundation. It has been setting up schools, hospitals and working towards social upliftment across locations where GMR Infrastructure has projects. Rao has been working on this foundation for a long time and the decision to pledge his entire 12.5 per cent stake to the foundation is set to give a boost to the foundation. With the resources, its efforts can take a quantum leap.
Rao says: “It has been a long journey and a satisfying one, seeing one’s vision of building an institution in perpetuity coming to fruition. Personally, it is more satisfying than winning in the bid for building the iconic Terminal 3 at New Delhi’s Indira Gandhi International Airport. I would like to thank all those who have made it possible and deem it as God’s greatness in giving my family and me the opportunity to give back to the society.”
Rao, 60, has evolved from the owner of a single jute mill in Andhra Pradesh to the chairman of a billion-dollar enterprise that is riding the crest of India’s effort to build infrastructure. A core businessman, he diverted his investment of Rs 350 crore in Vysya Bank to ING Group in 2001 and then channelled it towards infrastructure development. Through his journey and commitment to building infrastructure, he has exited his interests in insurance and breweries and reduced his interest in sugar, over the years.
“The 1990s was the time when the Indian government started an aggresive rollout of infrastructure projects in Public-Private Partnership and GMR was in a good position to leverage it,” a senior GMR Group official said.
Rao has grown as a businessman over the last three decades, even as the Indian economy has gone through different phases. Rao started his career when the government had absolute control over industry. He established his business when a debate over the impact of liberalisation on the country was on, so he is a product of the free economy.
Born in a small town, Rajam, in Andhra Pradesh, Rao, a mechanical engineer, is among those who could see the future of a particular sector and ride on the rising wave.
He grabbed the opportunity in infrastructure after the power sector was opened in the 1990s. GMR has a power generation capacity of 808 Mw and 11 projects under various stages. These projects, when completed, will take the total capacity to 8,448 Mw. Rao also diversified his business to roads and airports. GMR now manages airports in New Delhi and Hyderabad and is looking to aggresively expand its presence in this segment.
“G M Rao is not only a hard-nosed businessman but also a passionate human being. While his business acumen has established the company as a serious player in the infrastructure space, his humane traits have led him towards charity,” a company official, who has seen him closely, said. He also said Rao’s style of functioning was very democratic and consensual. “He has an amazing ability to connect with his employees. His warm and humble persona breeds loyalty among workers,” the official said.
Rao has also shown his ability to effectively execute strategic decisions. “He doesn’t think twice before taking a tough decision. Though his leadership style is democratic, he does take hard calls, which is necessary for growth of business,” the official said.
