Not many people will bet on a person who booted them out. However, this does not apply to Dilip Shanghvi, one of the most interesting and least understood business minds of our times. A Ranbaxy honcho, evicted shortly after Sun Pharma acquired it in 2014, confessed he had invested a significant chunk of his life’s earnings in Sun stocks. Another freshly sacked leader wagered wildly on Shanghvi in 2016: "Dilip bhai will buy out Teva to emerge as the largest generic drugmaker globally. I can bet every penny I am worth on this. Give it ten years."
When I reminded him that Teva’s revenues were four times Sun’s, he refused to budge. "What do you think Israel Makov is doing here?" It was true—among Shanghvi’s many unorthodox moves, choosing his own boss, the former Teva CEO credited with turning the company into a generics superpower, had fuelled such speculation.
These incidents reinforced an observation late DG Shah, then Secretary General of the Indian Pharma Alliance and Shanghvi’s long-time associate, had made about his biggest strength “On his way to ascent, from almost nothing to becoming the richest Indian, he has made very few enemies.
For a journey as steep as this in a country as complex and competitive as India, this is the rarest of rare traits." But rare, Shanghvi had been in many other ways. As a child, he sat in his father’s small wholesale medicine shop in Kolkata’s Dawa Bazaar after school, memorizing the chemical names of drugs and the diseases they treated. When, as a commerce graduate, he first shared his secret wish of starting a pharma company in the late 1970s, his friends laughed and grew concerned at the audacity of this man, who had neither a science degree nor any capital. When a worried friend asked, "What do you have, to start a company?" he stoically replied, "It doesn't matter what I have. What matters is what I do with what I have."
Not only did he start his dream company a few years later, he started it with some of those same friends. A decade later, when he had shifted to Baroda and his company was growing successful, the MD hired a chemistry lecturer to brush up his fundamentals. He was such a regular on Baroda-to-Mumbai trains that some ticket examiners knew him by face and name.
After he had listed the company, and shifted to Mumbai, his lifestyle was modest enough not to merit a separate washroom for himself in the office. No bodyguards, no private jets, no flashy parties for him even as he routinely figured among the richest Indians. Even after he toppled Mukesh Ambani to emerge as the richest Indian for a small window in 2014, he hadn’t stopped visiting modest South Indian eateries in Mumbai’s bylanes. As he relished his idli-sambhar one Sunday morning, a friend recalled someone walking up to him to quip, "Hey, you look so much like Dilip Shanghvi! If I hadn’t spotted you in this crappy place, I would have surely mistaken you for him."
Asked why he needed to live so modestly, he said: "Luxuries of lifestyle shouldn't dictate work choices. Once luxuries become personal habits, they force their way into professional decisions." Instead of celebrating his leap to the top of rich lists, he was uncomfortable being famous. In the age of instant gratification, Shanghvi stood for what a marathon approach could achieve. It is no mean feat that he has grown seed capital of `20,000 to a market cap of `4.4 lakh crore in four and a half decades—Re 1 invested at start would be `22 crore today.
But understanding him only through wealth-compounding lens would miss his essence, just as judging him on his calm demeanour can mask his fierce intensity. Beneath that mild-mannered exterior, fantasy and action are his favourite genres. A fan of Harry Potter and Avengers, Shanghvi, well into his sixties, preferred adventure sports on vacations with the same friends he started Sun with.
Finally, the Ranbaxy leader lost the ten-year bet to me in letter but won it in spirit. True to his style, Shanghvi opted for the less obvious route to emerge as a global pharma major. Through his $11.75-billion acquisition of US-based Organon—India’s second-largest overseas takeover—Sun has demonstrated it is no longer content with more scale in generics. "I learn from personalities and companies, what to do, and what not to do," he told me. It seems he learned from Teva what not to do—overdependence on commoditised generics and debt stress from mega M&As. So it’s no surprise that though Teva continues to be the largest generic behemoth globally with three times Sun’s revenue (ex-Organon), Sun’s market capitalisation is worth more than Teva’s. Through this acquisition, Sun has shifted its league from an Indian company with a global footprint to a global company headquartered in India. Shanghvi is already changing how Indian Pharma sees itself—proving that they can compete globally not only on cost, but on scale, complexity, and strategic ambition.
If the Organon execution goes well, it may well be the culmination of the ‘unfinished agenda’ of two of his predecessors—Parvinder Singh of Ranbaxy, who dreamt of a truly global pharma giant of Indian origin, and Anji Reddy of Dr Reddy’s, who dreamt of an innovative drug from India.
Granted enough time, Shanghvi may script the next chapter in Indian pharma—from imitation to innovation. And for this patient marathon strategist, preparations for that leap began at least a decade and a half back.
The author is a former business journalist and author of The Reluctant Billionaire: How Dilip Shanghvi became the Richest Self-Made Indian. Views are personal.
