Kotak: Man Of The Moment

India’s real estate landscape is dotted with unscrupulous realtors squatting on thousands of crores of home buyers’ money without delivering their projects. They draw up buyer-builder contracts with clauses that they can invoke to their advantage. 

 

One such attempt by India’s biggest real estate firm — Delhi-based DLF — brought it into a confrontation with the Competition Commission of India, which imposed a Rs 630-crore fine for abuse of power in 2012. The Supreme Court refused to intervene until the fine was deposited. This case became a litmus test for realtors’ conduct vis-a-vis their customers. But that was just the beginning of DLF’s woes. In September, the Punjab and Haryana High Court cancelled its land deal with a firm allegedly owned by Robert Vadra. And, in October, regulator Sebi barred the company from raising money from the stock markets for three years for hiding facts in its 2007 IPO filing. Assistant editor Abraham C. Mathews examines how the triple whammy will impact the debt-laden DLF (page 36).

 

Next, read about how Agar district in Madhya Pradesh has become the hub of sustainable or Responsible Soy farming, with farmers learning better techniques and selling soy to the world in just five years. Their productivity has grown by over 50 per cent and realisation has more than doubled, thanks to higher global soy prices. Responsible Soy earns these farmers a certificate for the soy produced as per sustainability norms. These certificates, which are similar to carbon credits, can be sold to companies committed to Responsible Soy worldwide. The initiative is set to reach Maharashtra and Rajasthan next year as India retains a huge advantage among other responsible producers because it produces non-genetically modified soy, which commands a higher premium. That’s on page 44.

 

This issue’s lead package is the seventh edition of the BW Best Banks Survey with knowledge partner PricewaterhouseCoopers. The jury (comprising of M.D. Mallya, former chairman and managing director, Bank of Baroda; Manish Kejriwal, managing partner, Kedaara Capital; Ramesh Iyer, MD, Mahindra Finance; and Sanjeev Churiwala, CFO, Ambuja Cements) was prescient in zeroing in on Uday Kotak, executive vice-chairman and managing director, Kotak Mahindra Bank (KMB), as the Banker of the Year. Kotak was chosen for his consistency, conservativeness, originality and enormous patience in building a profitable business in an industry that has been the graveyard for those who chased growth at the expense of profitability.

 

As it turns out, he is the man of the moment. Little did the jury know that within a month of its decision, Kotak’s  acquisition of ING Vysya Bank would propel KMB into the big boys’ club. Post-integration, KMB will be India’s fourth-largest private bank, just behind ICICI Bank, HDFC Bank and Axis Bank.

 

The jury’s choice for Lifetime Achievement in banking is none other than the dynamic ICICI Bank chairman, K.V. Kamath. Kamath shed his guard for a tete-a-tete with senior associate editor Raghu Mohan, the chief architect of this year’s Best Banks package (page 84).

 

Don’t miss Joe C. Mathew’s In Conversation with drug regulator Injeti Srinivas where he outlines how the government will regulate India’s runaway pharmaceutical industry (page 116).

 

(This story was published in BW | Businessworld Issue Dated 29-12-2014)