The Oldest Multinationals in India
Anand Adhikari May 9, 2013They have been in business for more than 75 years in India - and are still going strong. India's oldest multinationals have not only survived the ups and downs of the country's history, but have also thrived despite all odds. Starting out under British rule, these companies have their histories closely linked to the nation's economic trials and tribulations, both before and after Independence. They have gone from the highs of industrialisation and liberalisation to the lows of the recent downturn - and always come out on top.
Our special package, "The Oldest Multinationals in India", celebrates the journeys of some of the top global companies in India. Business Today chronicles the stories of eight companies through some of the turning points in their corporate lives. How did we choose these eight? Seventy-five years in India was the primary cutoff. From that list, we chose companies across sectors - to get a better spread - that were either the oldest or among the market leaders.
For sectors like banking, where regulatory restrictions hobbled scale, we did a peer comparison with other MNCs and chose either the oldest or the best performer. The chosen companies represent the very best of global business in India.
Today, these companies are not only deeply etched in the collective Indian consciousness, but have also become a critical part of the fortunes of their global parents. "The long stay of MNCs is ample proof of companies improvising their products, strategies and processes according to the local culture, demands and economic environment," says Richard Rekhy, CEO, KPMG India.
Their stories reflect their grit and determination to stay in the country even when the odds were stacked against them. Lubricants manufacturer Castrol India , for example, was not allowed to have more than six per cent market share when the regulatory environment went against it in the 1970s. But it stayed on and today is one of the largest players in the business. Similarly, not many know that Standard Chartered Bank once had a majority stake in Allahabad Bank, which it lost to nationalisation.
But that did not deter it from riding the liberalisation wave and achieving a leadership position in mergers and acquisitions. "Constant rejuvenation, re-launch of products and making brands relevant to the new demographics are the order of the day," says Rekhy. Their success is a reflection of the robustness of their systems and good corporate governance.
The future of these multinationals looks even brighter as India globalises and integrates with the rest of the world. Existing global companies in India have a head-start as the government liberalises foreign investment rules and new multinationals set up base in India. The success of these multinationals is a reflection of the robustness of their systems and good corporate governance.
Their long journey in India also has lessons for Indian industrialists such as the Tatas, Birlas and Mahindras, who are acquiring multinationals and expanding overseas. "The lessons are the ability to adapt to different markets, policies and regulations, different cultures and ways of doing business," says Jaspal Bindra, Group Executive Director & CEO, Asia at Standard Chartered Plc.