A merchant banker by profession (he is a chartered accountant and has also studied cost accountancy, company secretaryship and law), he worked for Shaw Wallace and Hindustan Lever for about a year before venturing out on his own. His first business move came when he bought two small-scale units, a ceramics unit in the 1980s and a chemicals unit in the 1990s. His father Shyam Lal, who earlier worked for a chemicals company in Renukoot, oversaw their operations. But when Shyam Lal passed away, Ruia shut them down. Later, in 1995, he set up Ruia Cotex, a cotton mill.
...Ruia’s interest in dead companies may appear unnatural, but there is a method to his madness. “Both Jessop and Dunlop have high brand value. They have their basic equipment in place. They also have employment-ready staff. It’s that much easier to create value from them than starting afresh,” he says. Besides, Dunlop has an asset base of Rs 1,500 crore and Jessop, around Rs 1,200 crore.
With Jessop back in the black, Dunlop on the road to recovery, and Falcon Tyres — a two-wheeler tyre maker he bought from Jumbo along with Dunlop — making sound profits (Rs 6 crore in 2006), Ruia’s infrastructure foray is gathering steam. He recently bought Hirakud Cables, a manufacturer of transmission towers, and IDCOL, a steel rolling mill, both, not surprisingly, ailing units of the Orissa government.
Arun Natarajan is the Founder of Venture Intelligence, which tracks private equity and venture capital in India and Indian-founded companies worldwide. View sample issues of Venture Intelligence India newsletters and reports.