Murugappa Group
Encyclopedia
The Murugappa Group is conglomerate
company headquartered in Chennai, India, with a valuation of Rs. 17,051 crores (USD 3.8 billion as on March 31, 2011) . It is a market leader in diverse areas of business including Engineering
, Abrasives, Finance
, General insurance
, Bicycles, Sugar
, Farm Inputs, Fertilizers, Plantations, Bio-products and Nutraceuticals. Its 29 businesses have manufacturing facilities spread across 13 states in India, with over 32,000 employees. The Group has forged strong joint venture alliances with international companies like Mitsui Sumitomo, Foskor, Cargill and Groupe Chimique Tunisien to consolidate its status as one of the fastest growing diversified business houses in India.
), which then spread to Malaysia, Sri Lanka
, Indonesia
and Vietnam
. In the following 100 years, it has withstood enormous vicissitudes, including strategically moving its assets back to India and restarting from scratch in the '30s, before the Japanese conquest of Burma in World War II
.
Starting with a sandpaper
plant, the Group forayed into making steel safes
, and then into manufacturing. It set up an insurance company, and bought a rubber plantation; making a small but significant beginning. Today, it is one of the country's biggest industrial houses. Group turnover crossed the $1 billion mark in 2003-04, with a growth of 25 per cent over Rs 4,206 crore in 2002-03, and a 40 per cent jump in profit before tax over the previous year. Consolidated Group turnover for 2004-05 crossed $1.44 billion, a growth of 20 per cent over the previous year. In 2005-06, combined turnover increased by 17 per cent to $1630 million (Rs 7,340 crore) and net profit (PBT) by 45 per cent to $177 million (Rs 800 crore). The Group ended the year 2006-07 with a turnover of Rs 8,446 crore, and profit before tax of Rs 649 crore. The year 2007-08 saw a turnover of $2.4 billion (Rs 9,852 crore). Group achieved a turnover of Rs. 13,617 crore during 2009-10. They intend to achieve a total turnover of $7.2 Billion by 2013-14.
-based organic pesticide, is the market leader in bio-pesticides. Some of the country's best-known brands like BSA and Hercules in bicycles, Parrys Spirulina and Parrys Beta Carotene in nutraceuticals, Ballmaster and Ajax in abrasives, Gromor and Paramfos in fertilizers, and many more come from the Murugappa Group.
Its companies have tie-ups with Wendt GmbH of Germany, Morgan Crucible Company PLC of the UK, the China Engineering and Exploration Bureau (CEEB), Cerdak Pty Ltd of South Africa, Mitsui Tsumitomo Insurance Company Ltd of Japan, Borg Warner Morsetec of USA, Foskor Ltd of South Africa, Groupe Chimique Tunisien of Tunisia, and Cargill International SA of Geneva.
for restructuring and succession plans, following the death of M V Arunachalam (1929-96), which brought the leadership to the older A M M Arunachalam, who died in 1999.
It was in 1999 that M V Subbiah decided to step down, bring in an external chairman for the Group, and let the family take advisory positions. The Murugappa Corporate Board was formed and N S Raghavan, a professional, was appointed as Chairman. On his retirement in 2001, P S Pai took over as Executive Chairman. During Pai's tenure the Group went through a period of learning and growth. On completion of his tenure, M A Alagappan, took over as Executive Chairman in October 2006 and A Vellayan as its Vice-Chairman and Director-Strategy. A Vellayan succeeded M A Alagappan as the Executive Chairman and M M Murugappan the Vice Chairman on November 1, 2009.
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Conglomerate (company)
A conglomerate is a combination of two or more corporations engaged in entirely different businesses that fall under one corporate structure , usually involving a parent company and several subsidiaries. Often, a conglomerate is a multi-industry company...
company headquartered in Chennai, India, with a valuation of Rs. 17,051 crores (USD 3.8 billion as on March 31, 2011) . It is a market leader in diverse areas of business including Engineering
Engineering
Engineering is the discipline, art, skill and profession of acquiring and applying scientific, mathematical, economic, social, and practical knowledge, in order to design and build structures, machines, devices, systems, materials and processes that safely realize improvements to the lives of...
, Abrasives, Finance
Finance
"Finance" is often defined simply as the management of money or “funds” management Modern finance, however, is a family of business activity that includes the origination, marketing, and management of cash and money surrogates through a variety of capital accounts, instruments, and markets created...
, General insurance
General insurance
General insurance or non-life insurance policies, including automobile and homeowners policies, provide payments depending on the loss from a particular financial event. General insurance typically comprises any insurance that is not determined to be life insurance. It is called property and...
, Bicycles, Sugar
Sugar
Sugar is a class of edible crystalline carbohydrates, mainly sucrose, lactose, and fructose, characterized by a sweet flavor.Sucrose in its refined form primarily comes from sugar cane and sugar beet...
, Farm Inputs, Fertilizers, Plantations, Bio-products and Nutraceuticals. Its 29 businesses have manufacturing facilities spread across 13 states in India, with over 32,000 employees. The Group has forged strong joint venture alliances with international companies like Mitsui Sumitomo, Foskor, Cargill and Groupe Chimique Tunisien to consolidate its status as one of the fastest growing diversified business houses in India.
History
The business has its origins in 1900, when Dewan Bahadur A M Murugappa Chettiar established a money-lending and banking business in Burma (now MyanmarMyanmar
Burma , officially the Republic of the Union of Myanmar , is a country in Southeast Asia. Burma is bordered by China on the northeast, Laos on the east, Thailand on the southeast, Bangladesh on the west, India on the northwest, the Bay of Bengal to the southwest, and the Andaman Sea on the south....
), which then spread to Malaysia, Sri Lanka
Sri Lanka
Sri Lanka, officially the Democratic Socialist Republic of Sri Lanka is a country off the southern coast of the Indian subcontinent. Known until 1972 as Ceylon , Sri Lanka is an island surrounded by the Indian Ocean, the Gulf of Mannar and the Palk Strait, and lies in the vicinity of India and the...
, Indonesia
Indonesia
Indonesia , officially the Republic of Indonesia , is a country in Southeast Asia and Oceania. Indonesia is an archipelago comprising approximately 13,000 islands. It has 33 provinces with over 238 million people, and is the world's fourth most populous country. Indonesia is a republic, with an...
and Vietnam
Vietnam
Vietnam – sometimes spelled Viet Nam , officially the Socialist Republic of Vietnam – is the easternmost country on the Indochina Peninsula in Southeast Asia. It is bordered by China to the north, Laos to the northwest, Cambodia to the southwest, and the South China Sea –...
. In the following 100 years, it has withstood enormous vicissitudes, including strategically moving its assets back to India and restarting from scratch in the '30s, before the Japanese conquest of Burma in World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
.
Starting with a sandpaper
Sandpaper
Sandpaper, also known as glasspaper, is a heavy paper with abrasive material attached to its surface.Sandpaper is part of the "coated abrasives" family of abrasive products. It is used to remove small amounts of material from surfaces, either to make them smoother , to remove a layer of material...
plant, the Group forayed into making steel safes
Safe
A safe is a secure lockable box used for securing valuable objects against theft or damage. A safe is usually a hollow cuboid or cylinder, with one face removable or hinged to form a door. The body and door may be cast from metal or formed out of plastic through blow molding...
, and then into manufacturing. It set up an insurance company, and bought a rubber plantation; making a small but significant beginning. Today, it is one of the country's biggest industrial houses. Group turnover crossed the $1 billion mark in 2003-04, with a growth of 25 per cent over Rs 4,206 crore in 2002-03, and a 40 per cent jump in profit before tax over the previous year. Consolidated Group turnover for 2004-05 crossed $1.44 billion, a growth of 20 per cent over the previous year. In 2005-06, combined turnover increased by 17 per cent to $1630 million (Rs 7,340 crore) and net profit (PBT) by 45 per cent to $177 million (Rs 800 crore). The Group ended the year 2006-07 with a turnover of Rs 8,446 crore, and profit before tax of Rs 649 crore. The year 2007-08 saw a turnover of $2.4 billion (Rs 9,852 crore). Group achieved a turnover of Rs. 13,617 crore during 2009-10. They intend to achieve a total turnover of $7.2 Billion by 2013-14.
Brands and international connections
Today the Murugappa Group is firmly established in India, and is poised for international growth. The group is a market leader in India across a spectrum of products like fertilizers, abrasives, automotive chains, car door frames and steel tubes. Neemazal, a neemNeem
Azadirachta indica is a tree in the mahogany family Meliaceae. It is one of two species in the genus Azadirachta, and is native to India growing in tropical and semi-tropical regions. Its fruits and seeds are the source of neem oil...
-based organic pesticide, is the market leader in bio-pesticides. Some of the country's best-known brands like BSA and Hercules in bicycles, Parrys Spirulina and Parrys Beta Carotene in nutraceuticals, Ballmaster and Ajax in abrasives, Gromor and Paramfos in fertilizers, and many more come from the Murugappa Group.
Its companies have tie-ups with Wendt GmbH of Germany, Morgan Crucible Company PLC of the UK, the China Engineering and Exploration Bureau (CEEB), Cerdak Pty Ltd of South Africa, Mitsui Tsumitomo Insurance Company Ltd of Japan, Borg Warner Morsetec of USA, Foskor Ltd of South Africa, Groupe Chimique Tunisien of Tunisia, and Cargill International SA of Geneva.
Executive succession
The Murugappa Group transitioned to a professionally managed corporate house, engaging Arthur D. LittleArthur D. Little
Arthur D. Little is an international management consulting firm originally headquartered in Boston, Massachusetts, United States, and formally incorporated by that name in 1909 by Arthur Dehon Little, an MIT chemist who had discovered acetate. Arthur D. Little pioneered the concept of contracted...
for restructuring and succession plans, following the death of M V Arunachalam (1929-96), which brought the leadership to the older A M M Arunachalam, who died in 1999.
It was in 1999 that M V Subbiah decided to step down, bring in an external chairman for the Group, and let the family take advisory positions. The Murugappa Corporate Board was formed and N S Raghavan, a professional, was appointed as Chairman. On his retirement in 2001, P S Pai took over as Executive Chairman. During Pai's tenure the Group went through a period of learning and growth. On completion of his tenure, M A Alagappan, took over as Executive Chairman in October 2006 and A Vellayan as its Vice-Chairman and Director-Strategy. A Vellayan succeeded M A Alagappan as the Executive Chairman and M M Murugappan the Vice Chairman on November 1, 2009.
Community involvement
The Group has been involved in corporate contribution to the welfare of the community, from the time they began their journey in 1924. The AMM Trust was formed to set up and run hospitals and schools in Chennai and Pallathur, the native place of the founders. The Group claims to have been at the forefront of eco-conservation, public health, and education in the communities where its companies operate, since 1957. It runs four schools, a polytechnic college, four hospitals, and research and development center for rural development, the Sri AM Murugappa Chettiar Research Centre (MCRC), which has been designing simple, cost-effective technologies for local artisans since 1977.Group Company
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Net Access (India) Limited
Cholamandalam MS General Insurance Company Limited
Cholamandalam MS Risk Services Company Limited