The Empire Dream
In an era of economic uncertainty only a few promoters would have the audacity to share any long-term guidance with its shareholders and employees. Vivek Chaand Sehgal, 61, is one such exception who outlines his company’s five-year vision after every five years and has delivered on all occasions.
Sehgal is the Chairman and co-founder of the $9.1-billion (approx. Rs 58,240 crore) Samvardhana Motherson Group (SMG), whose flagship company Motherson Sumi Systems (MSSL) makes components including wiring harness, rear view mirrors, among other things for the auto industry. Abiding by the philosophy that “top line is vanity, the bottom line is sanity, cash in the bank is reality”, he has made MSSL one of the largest auto ancillary companies in India with a top line of $6.5 billion (appox. Rs 41,985 crore). He is confident that by 2020, the figure will touch $18 billion.
“The trust which our customers and stakeholders have reposed in us is our biggest achievement,” says Sehgal. “This reflects in the company’s growth since its establishment. From being a single product manufacturer in India, today we have a presence in 33 countries, all with the support of our customers.”
It is pertinent to note that unlike the Tatas and Ambanis, Sehgal has done all the hardwork, sowing the seeds of his vision when he was just 18 years old by getting into silver trading. He co-founded SMG in 1975 along with his mother (hence the name Motherson) and, a couple of years later, he went on to set up the group’s first factory to roll out power cables.
However, the turning point came only when he took the plunge into the auto component industry by inking an agreement with Tokai Electric (now Sumitomo Wiring Systems) in 1983 to manufacture wiring harnesses for Maruti Udyog (now Maruti Suzuki). That was the stepping stone to form his group’s flagship firm MSSL.
A large part of the company’s meteoric rise is attributed to the inorganic growth it has mastered over the years. MSSL acquired the rear-view mirror business of UK’s Visiocorp in 2009 and rechristened it Samvardhana Motherson Reflectec (SMR). Acquiring a company which is double its size and scale, it gave the Sehgal-run company a bridgehead to become one of the world’s largest manufacturers of rear view mirrors. The group’s flagship company along with its over 100 subsidiaries and JVs in auto ancillaries has grown largely on the back of overseas buyouts — 16 in the past 15 years.
Recently, it has acquired a Finnish auto component firm PKC Group for $609 million and is reportedly eyeing Bosch’s starter motors and generator arm for approximately $600 million. “We have delivered on our promises and turned around the assets,” says Sehgal.
An entrepreneur who is always on the move, Sehgal likes to focus on building relationships, be it with his customer or with employees across the globe. “I spend quality time with them by sharing experiences. At the end, it’s about looking for the opportunities where we can find solutions for requirements or concerns,” he says.
For a businessman with humble beginnings, Forbes has estimated his net worth at $4.8 billion as on 22 July. On his global aspirations, Sehgal says that he does not aim for a global ranking as he believes rankings are a byproduct of the good work. “If you look back at all our five-year plans starting from the 1990s, you will see how we have increased the size of the pie. In the 2020 plan, we have further enhanced the diversification in terms of customer base, product and country,” says the confident businessman.
