A change is in the wings, though perhaps not right now, for Basant Kumar Birla's Kesoram Industries. Birla, who is 90 and the chairman, says his daughter, Manjushree Khaitan, will manage Kesoram, but under his grandson, Kumar Mangalam Birla.
"Manjushree will look after the company and will be in constant touch with Kumar Mangalam Birla. I would want Kumar Mangalam to be the chairman of the company; Manjushree can be the vice-chairman," said Birla, on the sidelines of the Kesoram annual general meeting.
Last year, a shareholder suggested Khaitan be made vice-chairman. While Birla said he would consider, he was clear that Kumar Mangalam would inherit the company.
"All my companies will go to Kumar Mangalam, but my daughters will get a part of it," he said, when asked whether there was any change in the succession plan. Birla does not plan to retire at present. Though Birla did not make clear today if his statements meant another change in the inheritance of Kesoram, it was a departure from earlier indications. His statements today cleared the position regarding his views on Khaitan's role.
And, she addressed the shareholders for the first time and outlined a vision for the company, the most aggressive road map in recent times. "Kesoram would go beyond Rs 10,000 crore," she said while emphasising the need for a strategic long-term view.
Kesoram ended 2010 with a turnover in excess of Rs 5,000 crore. The board today approved an expansion plan entailing an investment of Rs 1,125 crore.
Birla's will, made in July 2004, said each company of his would be inherited by the person who was in charge of it and overseeing its day-to-day affairs. Under the formula, Manjushree Khaitan and the other daughter, Jayshree Mohta, were to get Kesoram Industries and Jay Shree Tea & Industries, respectively.
However, he later changed it, and said all the major companiesCentury Textiles, Century Enka and Kesoram Industrieswould go to Kumar Mangalam Birla.
B K Birla was also planning to merge Mangalam Cement and Mangalam Timber. "Some directors are opposed to it," he said, adding that the former was profit-making and the other was making losses. Birla plans to increase his holding in the two companies to 40 per cent. As of March, promoter holding in Mangalam Timber Products was 37.32 per cent and in Mangalam Cement, 25.49 per cent. Birla would like to take his holding in all companies to at least 40 per cent.
