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APRIL 24, 2005
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Fashionably Chinese
China, say marketers, the kind who believe in touchy-feely research, is better understood not by all the statistics that forever hold economists in thrall, but by what is actually going on in such arenas as fashion. So, what's going on anyway? Here's an attempt to find out. Through a thoroughly unscientific sample survey of China's fashion scene.

It's a name everyone who can spell 'fashion' has heard of, but a name very few in India can explain the actual significance of.

More Net Specials
Business Today,  April 10, 2005
India's Best CFOs

The 13 other CFOs who made it to the final stage of the Business Today study.

Sanjiv Bajaj
Executive Director (Finance)/Bajaj Auto

It isn't easy managing the finances of a company that has its balance sheet weighed down by cash but Sanjiv Bajaj, the 35-year-old Executive Director (Finance) of Bajaj Auto is not affected by that at all. "We make sure our operations are run tightly and are not affected by this cash," says the MBA from Harvard Business School. Well, there is a lot of that (cash), over Rs 5,000 crore at current market prices actually, and it returns a mere 9-10 per cent, pulling down Bajaj Auto's Return on Capital Employed (excluding cash, this is a rosy 75 per cent) to 20 per cent. The company can redress this by returning cash to shareholders; then, as Bajaj points out, much of it will be used up "in the next 3-5 years for our expansion in foreign markets".

Robin Banerjee
Executive Director (Finance)/ Thomas Cook (India)

He inherited a cash-rich company, but that hasn't stopped 48-year-old robin Banerjee, who signed on as Executive Director (Finance) at Thomas Cook on April 1, 2004, from trying to do one better. For instance, the chartered accountant is using his past experience with a steel company to drive home the necessity of focussing on cost of capital, including own funds. "That is why we decided to give the detailed EVA (economic value added) analysis this time in our balance sheet," says Banerjee. Then, he has taken several steps to control overall costs, improve collections, increase returns from treasury operations, even train middle managers on the basis of finance by travelling to Thomas Cook's offices across the country.

Kaushik Chatterjee
Vice President (Finance)/Tata Steel

After a 10-year restructuring programme (headcount reduced from 77,000 to 41,000, and raw-material consumption per saleable tonne from 4.52 tonnes to 3.08 tonnes), Tata Steel is on the threshold of a major explosion (by increasing capacity from 4 million tonnes now to 15 million tonnes by 2010). "The CFO's job is to make sure that this is profitable growth," says Koushik Chatterjee, the company's 36-year-old Vice President (Finance). Chatterjee was also directly involved with the company's acquisition of NatSteel, Singapore. And he got Tisco rated two notches above the sovereign rating (for local currency borrowings) by S&P. "Tisco is the only company in the country that can boast of a rating two notches above the sovereign ratings," he says. The man belongs here.

H.G. Gelis
Executive Director(Finance)/Siemens

It isn't just this listing that identifies H.G. Gelis, the 46-year-old executive director of Siemens as an outperformer. Siemens India ranks first among all Siemens companies (there are 190 in all) worldwide, in terms of return on capital employed (ROCE). "And we have got an award for that too," he says proudly. Clearly, Gelis' efforts to make everyone in the organisation, including engineers, aware of basic financial parameters such as shareholder value and EVA have yielded the desired results. Significantly, most members of his finance team boast an engineering background. "CFOs have to move from the traditional role of financial management to strategic management," says the man.

S.G. Joglekar
Vice President (Finance)/Bharat Forge

It has been an active four years for 48-year-old S.G. Joglekar, vice president (finance), Bharat Forge. In 2001, the company's Return On Net Worth was 8.83 per cent; in 2004, it was 60.6 per cent. And its net working capital cycle fell from 34.82 days to a negative 22.99 days in the same period. "We have focussed on inventory," is all the chartered accountant who has been with Bharat Forge since 1985 will say. "Since we export quite a bit, we utilise pre-shipment and post-shipment finance to our advantage," he adds. Another major move was the dollar-isation of the balance sheet, a move that should help Bharat Forge beat volatility in the foreign-exchange market.

Praveen P. Kadle
Executive Director (Finance & Corporate Affairs)/Tata Motors

Praveen P. Kadle, the 48-year old executive director (finance & corporate affairs) at Tata Motors should get a major share of the credit for turning things around at the company. "Our board had taken a long-term (five-year) vision in 2001 to turn around the company first (in the first two years) and then to grow fast later (for the next three years)," he says, implying that everything he effected-financial restructuring, reduction in borrowings, improvements in working capital management-was based on this. "We have not just became a debt-free company; but have enough cash now," says Kadle, who has also been actively involved in the company's global M&A play.

Mehernosh B. Kapadia
Senior Executive Director/GlaxoSmithKline Pharmaceuticals

In a market that has not always been kind to multinational pharma firms, GSK Pharma's operating margins have moved steadily from 13.22 per cent in 2001 to 28.92 per cent in 2004. How did Mehernosh B. Kapadia, the company's 50-year-old Senior Executive Director, achieve this? First, by redesigning the product portfolio and moving to higher-margin products; second, by consolidating manufacturing (the number of plants came down to two from nine previously); and finally by integrating six different entities into one and reducing headcount from 7,500 to 4,100. "For the last three to four years, we delivered more than we promised to our investors," says the chartered accountant who has served on the board of the company since 1996.

P.K. Mukherjee
Director (Finance)/Sesa Goa

Things are improving fast at Sesa Goa (for instance, return on capital employed has rocketed from 11.65 per cent in 2001 to 78.75 per cent in 2004), as indeed they have at most steel companies, although 49-year-old P.K. Mukherjee, Director (Finance), insists that this isn't just because of the upturn in the steel cycle. "We have reduced our cost of debt," says the chartered accountant, adding that Sesa has made some improvements on the working capital front. "Our strong hedging mechanism helped us to make money from our forex transactions as well," says Mukherjee. With mining leases not available at will, the ore major is sitting on a huge pile of cash. "Now it is a problem of abundance," laughs Mukherjee.

T.V. Mohandas Pai
Director (Finance & Administration) and CFO/Infosys Technologies

In March 1999, T.V. Mohandas Pai, the 47-year-old CFO of infosys was part of the core team that worked on the first listing of an Indian company on an American stock exchange (NASDAQ). Even before this listing (which resulted in higher transparency), and today, six years later, Infosys has always been very clear, and still is, on what it wants to be. "Our aim is to be among the best companies and also become the most respected company in the world," says Pai. It only follows that Infosys finalises its accounts very fast, conducts its annual general meeting at the earliest possible date, and boasts one of the most transparent balance sheets in India. Fund managers, brokers and investors can't have enough of it.

S. Rajagopalan
CFO/ Monsanto India

Monsanto India's gains on the growth front can largely be attributed to its seeds business (acquired in 1999). Believe it or not, S. Rajagopalan, the 40-year-old CFO of the company, has had a role to play in this. As has astute working capital management. "In the seed business, if you don't manage your inventory, you are dead," says Rajagopalan. So, Monsanto works with the least possible inventory, all the while pursuing its pricing-for-value (educate farmers on how they can get the most out of a good quality product, then encourage him to pay more for it) strategy. Rajagopalan has also had to work on the company's collection mechanism (again, critical in the business) and says that improvements on this front will see "our cash position growing year after year".

D.D. Rathi
Whole Time Director & CFO/Grasim Industries

The CFO of a conglomerate (such as Grasim) has a totally different work profile from that of a CFO of a single-division company. In Grasim's case, each division has a head reporting to the board. "My job is to act as a link between the board and operational management," says D.D. Rathi, the 58-year-old CFO of Grasim. It isn't that Rathi, a chartered accountant (he was one before he turned 21) doesn't deal with matters financial. Over the past six years (he was with Indian Rayon before that), he has focussed on financial and debt restructuring, and been involved in the company's acquisition of L&T's cement division. That leaves little time for anything else, and Rathi likes it that way. "I am a workaholic and work is my hobby," he laughs.

Ravi Sud
Vice President (Finance)/Hero Honda Motors

The thing about Ravi Sud, the 50-year-old vice president (finance) of hero honda Motors is that he is a manager in a domain filled with accountants. That could explain how the IIM Ahmedabad alum increased the company's Return On Net Worth from an already-high 47.52 per cent three years ago to 61.44 per cent today. Sud effected this by getting tough with costs and reducing the working capital cycle (it is now negative), and keeping shareholder funds low by issuing liberal dividends. "We follow the dividend theory in spirit and when we have excess money we return it to its real owners (investors)," he says.

K. Vaidyanath
Executive Director/ITC

The 55-year-old K. Vaidyanath, executive director, ITC isn't just a CFO; he is a super CFO. Reason? ITC is a conglomerate with 12 businesses (across fast moving consumer goods, hotels, paper, paperboards and packaging, and agri-business) and each of these has its own CFO. "The Divisional CFOs have a direct reporting line to the respective Divisional CEOs and a dotted line reporting to me," says Vaidyanath, an MBA from XLRI, Jamshedpur, who has been with ITC for the past 28 years. There's more: At ITC, the IT function is led by the CFO (that is something; ITC, you see, has an extensive virtual private network connecting almost 400 locations and supporting shared services through integrated data centres). "This structure enables the company to carry finance and technology as a common theme across businesses," says Vaidyanath.




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