Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday

People often confuse noise with aggression: Sumant Sinha

People often confuse noise with aggression: Sumant Sinha
Comment E-mail Print Share
First Published: Sat, Jun 02 2007. 01 23 AM IST

Updated: Sat, Jun 02 2007. 01 23 AM IST
A meeting in Goa with Kumar Mangalam Birla, chairman of the $24 billion (about Rs98,400 crore) Aditya Birla group, on the first day of 2002 changed Sumant Sinha’s career forever. The investment banker involved in raising sovereign bonds for Third World countries became a corporate strategist for a respected industrial group that was transforming itself from a commodities conglomerate to a house of new businesses. It was not a chance meeting, though.
About 10 months earlier, a headhunter convinced Sinha, then a New York-based senior executive at ING Barings, to meet Birla at Industry House, the company’s Mumbai headquarters. Birla had offered him the job, but Sinha could not make up his mind. This time, however, he did not say no.
“I was an Indian working for an Anglo Dutch firm in New York and doing business mostly in Latin American countries. I asked myself, where am I headed? Investment banking gives you good money, but I was not creating any value for the business,” says Sinha.
His father, Yashwant Sinha, then India’s finance minister, was not too keen his son return. But that did not change the younger Sinha’s decision to come back to India after 11 years. “We are two different individuals. He has his own life to lead and I have mine, you know,” he says.
We are at the Willingdon Club in Mumbai on a weekday evening. Sinha doesn’t want beer on an empty stomach. So, we order ham sandwiches, chicken tikkas, fish fingers and three glasses of sweet lime— two for him, one for me. The immediate provocation for this meeting is the Aditya Birla group’s entry into the retail business, which Sinha heads. He’s agreed to meet me on one condition: We will not discuss the company’s retail strategy.  
Of course, it’s difficult to resist the temptation to ask why the retail venture is called More. To match Reliance’s Fresh? “We will offer more value, more choices, more variety, more quality and more convenience. You will get more for less. This is true for all stakeholders—the consumers, the employees and the partners,” Sinha says. He is not revealing any confidential business strategy. Did the name come from Birla? “He participated actively in the discussions,” Sinha says, without going into details. We are still warming up.
Isn’t the Birla group late in entering the retail business? There are already quite a few big players—Reliance Industries, Pantaloon, Shoppers’ Stop, the Tatas. This time, Sinha is provoked. “I find questions about the crowded retail space quite naïve. Shoppers’ Stop has one hypermarket and Pantaloon has Big Bazaars. But the retail game in India has not yet started. Organized retail is just about 3 to 4% of the total retail business. The players are just scratching the surface. The real game will start after four to five years. How can you say that we are late?”
Sinha points out that the global retail business is highly fragmented. “Wal-Mart has about 7% share in the US market,” he says. “The retail business is evolving in India and nobody knows now what will be the winning format—cash and carry, or discount stores, or something else.”
All Sinha will say about More’s USP is that one cannot be wedded to preset beliefs and that one needs to respond to evolving situations to succeed. I switch tracks and ask him what the bigger challenge will be—finding people and real estate or coming up with a unique strategy? “The real challenge is finding the right strategy. One can find ways to overcome the problem of shortage of people, say, by tying up with colleges. One can buy or rent real estate, but one must get the business strategy right from the beginning.”
So, what will his strategy be? He gives me a hard look and says: “It could be anything. Offering the same experience to consumers day after day itself is very hard to do. Maintaining consistency is an achievement.”
More will open its first supermarket in Pune this month and expand rapidly over the next couple of years—without an international partner. “Retail is a local business. What do you gain from a foreign joint venture partner in this business? If one can hire the right people to run the business, why would one offer precious equity to a partner? It’s all about understanding local consumers and we can do that well on our own.”
Too many questions on the retail venture and Sinha now looks impatient. After all, why would one outline one’s plans before the first store is launched, especially in the current fiercely competitive scenario?
We talk instead about why the Birla group is perceived as one lacking aggression. “Over the last few months, it has acquired aluminium giant Novelis and a majority stake in Idea Cellular. It has announced a Rs9,000 crore investment in the retail business. We do all this quietly. People often confuse noise with aggression.”
After working closely with Kumar Mangalam Birla for five years, Sinha has picked up a few things. “One can learn from him how to stay cool in any circumstance. He is smart. He empowers you, but at the same time he knows how to be in control of everything.”  
Sinha does not carry his office home, but there is no escape from discussions on finance and business as his wife Vaishali heads Daiwa Securities in India. The last film he saw was Spider-Man 3, and he is currently reading a draft of his father’s biography.
Has he ever thought of joining politics? “One part of politics is attractive—the power. But I have been with my father on the campaign trail in Hazaribagh, Jharkhand, and have seen how tough it is. And once you lose the elections, you sit in the opposition, twiddling your thumbs for five years. It’s a long time. I have been with the Birla group for five years. You can do so much in five years.”
As we get up, I ask him if he has a plan for the next five years. “I have learnt in life not to plan too far. Who knows what happens in future? Right now, I need to see the retail project through,” says Sinha.
Name: Sumant Sinha
Born: February 1965 (New Delhi)
Education: St Columba’s School, New Delhi; IIT, Delhi; IIM, Calcutta; Masters in International Finance from Columbia University.
Work profile: He joined the Aditya Birla group in 2002 as president, finance, and is now the CEO of Aditya Birla Retail. Before that, he worked at Citicorp Securities and ING Barings.
Comment E-mail Print Share
First Published: Sat, Jun 02 2007. 01 23 AM IST
More Topics: Lounge |