Aditya Birla Nuvo: A business builder
10 May 2007
It is oft repeated, yet a charming and powerful imagery: the morphing of a caterpillar into a beautiful butterfly that can fly unrestrained over flowery meadows. At Aditya Birla Nuvo that is what we do — acquire young, nascent businesses, nurture them, make them strong and then give them wings to fly on their own.
Speaking on the occasion of releasing the annual business performance numbers to the media and analysts, Dr. Bharat Singh, Managing Director, said, "Aditya Birla Nuvo is a business builder. We nurture promising businesses, putting a hand on their shoulders, giving them finances, manpower and all other support to help them grow, flower, bloom and then stand on their own feet." This is amply evident from the recent listing of Idea on the stock exchanges. Over the last two years, Aditya Birla Nuvo increased its stake in the company from 4.3 per cent to 20.7 per cent to 35.7 per cent. It gave Idea some of its top management people, it shared best practices and most importantly, it gave the company the umbrella of the Aditya Birla Group. The efforts paid rich dividends when Idea finally became a listed company in March 2007.
Over and above telecom (Idea) which is now self driven, three other businesses are also experiencing Nuvo's hand holding — BPO, insurance and financial services and garment retail.
It was indeed a momentous occasion for TransWorks, a BPO company acquired by Nuvo in 2003, when it bought over Minacs, a leading Canadian BPO player, four times its size, in June last year. Since then, seven new sites have been added in Philippines, North America and India. New customers have come into the fold and the growth graph is showing a healthy upward trend.
Similarly, Madura Garments, which achieved a turnover of Rs.700 crore in 2006-2007, is all set to expand its retail presence even more rapidly with investments of over Rs.290 crore. The brands in its stable — Louis Philippe, Van Heusen, Allen Solly and Peter England — are expanding their reach through larger format and exclusive stores. All this, of course, with the firm backing of Nuvo's strong balance sheet.
In the last year, Birla Sun Life Insurance has ramped up its agency force from about 17,000 to over 56,000. The number of branches has gone up to 137. It continues to invest in and leverage technology to give its customers new levels of service. Due to these investments, it is possible that the break even may be still two years away. But Nuvo's staying power ensures that the company can continue to remain focused on launching new and innovative products to different customer segments.
For the year ended 31 March 2007, Aditya Birla Nuvo posted a revenue of Rs.8,258 crore and net profit of Rs.281 crore.