Home >companies >people >BGR group founder B.G. Raghupathy dies at 59

Chennai: B.G. Raghupathy, the 59-year-old chairman and managing director of BGR Energy Systems Ltd, died Sunday night, the company said in a statement to the stock exchanges. He is survived by his wife Sasikala, who is a director in the company, a son and three daughters.

A company spokesperson on Monday said Raghupathy had complained of stomach pain, following which he was admitted to a hospital. He died at around 10pm on Sunday.

His daughter Swarnamugi Karthik joined the company in February as an additional director and was later appointed as a whole-time director, corporate strategy. Son Arjun Govind works as an engineer in one of the company’s plants, another daughter Priyadarshini R. is manager, corporate strategy, and the youngest daughter Vani R. recently completed her graduation and is working as a trainee in the company.

The company spokesperson said he could not comment on the succession plan. “We have a strong board with able executives who will be to guide the company until such time successions are announced," the spokesperson said. “There is no need to jump to conclusions."

Raghupathy, a first-generation entrepreneur, was the founder chairman of the BGR group of companies, which employs around 2,000 people.

The group’s flagship company BGR Energy Systems was founded in 1985. The Chennai-based power equipment maker was originally incorporated as a joint venture between GEA Energietechnik GmbH, Germany, and B.G. Raghupathy to manufacture and sell parts used in thermal and nuclear power plants.

BGR Energy, which executes engineering, procurement and construction (EPC) and balance of plant (BoP) projects, entered into a strategic partnership with Hitachi in 2010 for manufacturing super-critical boilers, turbines and generators of 660MW, 800MW and 1,000MW capacity.

“Raghupathy was instrumental in turning BGR from a BoP to an EPC company. And like most of the mid-cap Indian companies, BGR, too, was a closed company that was promoter-driven," said a Mumbai-based analyst who requested anonymity.

Investors have been worried in the past few months about the BGR-Hitachi joint venture falling through as Hitachi entered into a global alliance with Mitsubishi Heavy Industries Ltd. Since Mitsubishi operates in a joint venture in India with Larsen and Toubro Ltd, analysts fear Hitachi will prefer to maintain its global alliance partner in India, too.

“That fear is more so now. Raghupathy was driving the business, and there is little visibility now on how much the senior management is empowered to take the business forward," said the analyst.

He added that even during meetings with analysts, the business heads wouldn’t be introduced, and only Raghupathy and the chief financial officer P.R. Easwar Kumar would address investors.

He fears the low investor confidence in the next level of management will reflect in the order book in terms of new orders, and the company’s capacity to execute current orders.

BGR has an order book of about 20,000 crore under execution. Earlier this month, it signed a contract worth 1,573 crore to supply equipment to Odisha Power Generation Corp. Ltd for expanding its coal-based thermal power project.

On Monday, BGR shares fell to a new low of 89.70 on BSE, while the Sensex ended 0.78% lower at 19,593.28 points.

“If there was confidence in the senior management to take care of the company, the stock wouldn’t not have fallen to such lows," the analyst said.

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