Ratul Puri, the executive director of Moser Baer India Ltd, grew up in Kolkata during the 1970s. Back then, he remembers, it was a city starved of energy. “Regular 10-hour power cuts due to load-shedding were the norm,” Puri reminisces as we chat in a private dining room at the Belvedere Club in The Oberoi hotel in New Delhi.
Puri is impeccably dressed. His dark grey suit is without a crease, worn over a white shirt and a dark tie. His speech is equally flawless.
Early in our chat we veer towards Puri’s latest passion: solar power. Perhaps childhood memories inspired the 36-year-old to trigger Moser Baer’s less-than-obvious diversification from compact discs (CDs) into solar power panels in 2006. Obvious or not, Puri articulates his company’s plans for solar energy with conviction: “Right now the company has cumulatively invested about three quarters of a million dollars and has built a capacity close to 150MW. We aim to be among the top five producers of solar energy globally in the near future.”
Starting blocks: Puri finds ‘phase one’ the most exciting aspect of any diversification plan. Jayachandran / Mint
We briefly interrupt the conversation to order lunch. Puri is unhappy when I ask for just a Greek Salad. He insists I order something more substantial and relents when I promise to order dessert later. He opts for a baked, deboned Dover Sole fillet.
After placing our orders, I ask Puri to explain the rationale behind a manufacturer of optical storage devices moving into content distribution. He confesses to have tried watching pirated movie discs a few times himself, but gave up on them, frustrated at the hazy picture quality, poor disc reliability and the infuriating shadows that pop up on screen.
It wasn’t any altruistic urge to battle piracy but business logic that made Moser Baer launch its competitively priced range of movie discs. “Home entertainment was a unique area for us. We started out in 2007 and now control about 70% of the landscape. We had developed low-cost, pre-recordable opticals and wanted to exploit that opportunity.” But when Puri approached existing content owners, he found that their view about the market was “very myopic”. He was clear that Moser Baer would enter the business only if the volumes were large enough. At the time, the 20 million units annual sales numbers for pre-recorded content was merely a blip next to Moser Baer’s sales of four billion blank discs. So Puri decided to enter the market with an aggressively priced product.
Research indicated that the home video market could grow if the price points were right, the quality of the discs was good, the distribution network well connected, and movies released on discs a month or two after premiering at theatres.
Today Moser Baer, Puri reckons, owns half the content produced in the country (around 6,000 titles in all). “Even the seven big Hollywood studios—all the content they have ever launched cumulatively is less than 6,000 titles. We have acquired content across 16-17 (Indian) languages and at times were negotiating three-four contracts a day,” he says.
Puri claims that their business is “largely content agnostic. We look at ourselves as a distribution company and we will distribute any content. We are not trying to pick the next winner (movie)”. Though the company has funded content production and will do so opportunistically, Puri insists that movie production will never become a core business.
But while home movies had a clear link to Moser Baer’s existing businesses, the reasons for getting into the new solar power business were much less obvious. The genesis of that business was a chance meeting between Puri and an entrepreneur who worked with a solar power start-up in the US. That meeting, and the realization that “solar (energy) was going to see a path to grid parity in four-five years, not 20 years as global predictions indicated”, convinced Puri to diversify in this field. (Grid parity is the point at which the cost of solar power becomes equal to or cheaper than conventionally generated power. In other words, Puri believes that large-scale solar power generation will become feasible in half a decade.)
But still, strategic rationale aside, aren’t photovoltaic panels a far cry from round plastic discs with movies and music on them?
Puri not only disagrees but, between bites of Dover Sole, launches into a passionate technology-laden monologue on the similarities: “As products, solar panels and black optical discs are very different. (However), the key technology used in solar panels essentially centres around coating thin film on top of a substrate, which is what we do in blank optical discs.”
He explains that CDs and DVDs involve coating a plastic disc, while solar panels, essentially, are thin layers of semiconductors on silicon. The synergy was apparent to Puri: “We looked at the product (panels) and looked at our core capabilities, and believed that this would be good adjacent business to grow in.”
I ask Puri if this was a breakthrough moment. “No, I would not call it that. It was not an E=mc² moment. But yes, we were among the first in this business to make a connection, and realize that we could make this cost-effective too. Now, some global competitors in the optical disc space are following suit.”
For Moser Baer, set up by Puri’s father Deepak Puri in 1988, it is just the latest in many diversification projects—Puri counts at least five. The company began as a manufacturer of time recorder units—machines that employees punched into when they entered and exited offices and factories. Moser Baer then branched out into making floppy discs, CDs and DVDs and, most recently, into consumer electronics.
Puri thrives on the excitement of a start-up. “It is the stage when you are trying to chart out a path, understand and put together a strategy, build a team. Once a business heads towards maturity, I spend less time with it.”
Over Tiramisu (for me) and black tea (for him) we discuss the future of solar power. Once a black coffee addict, Puri switched to green teas to reduce his caffeine intake. His company is currently working on solar farms, commercial power solutions and a solar power kit in a carton “with panels, cables, inverters, and an idiot-proof manual” that even households can install and use.
As we walk out, Puri sounds optimistic about the technology: “The general feedback we are getting is that people like the idea that they don’t have to use external fuels like diesel, or plug into a power grid and pay for it. As a race, Indians like the idea of ‘Ek time kharcha, phir muft hai uske baad’ (one-time investment and no running expenses).”