INTRODUCTION

Birla Corporation Limited, is an Indian-based flagship company of the M P Birla group of

companies, founded by Shri Ghanshyam Das Birla in the late 1910s and carried on by
Madhav Prasad Birla.
In the 1890s, Birla Corporation was a jute manufacturing company, but over time, it
grew to operate four main divisions: cement, jute, vinoleum, and auto trim. [1] It is not a
part of the Aditya Birla Group, a multinational conglomerate with products ranging from
metals, cements, textiles, agricultural businesses, telecommunications, IT, and financial
services. Formerly known as Birla Jute Manufacturing Company Limited, with the
expansion of divisions, the company changed their name in 1998 to Birla Corporation
Limited.

Before Birla Corporation Ltd.

Shri Ghanshyam Das Birlas grandfather, Shiv Narayana Birla used his capital from a
moneylending business and started a cotton business. With a successful venture, he
went back to Pilani, his birthplace, and built a mansion for the family. Business boomed
with World War I as the British Empire relied on Birla to provide for the war efforts. GD
Birla inherited the family business and expanded into many industries, and by 1919, the
Birla Brothers Limited was formed with his other three siblings. He ventured into the
motor vehicle industry, tea, textiles, cement, chemicals, and by 1942, also organized
the United Commercial Bank Limited, one of the first commercial banks of India. While
still in the early years of the Birla Group, an inkling of the future of Birla Brothers Limited
was depicted in GD Birlas life.

Founding of Birla Corporation Ltd.

Born in 1918, Madhav Prasad of Bombay, son of GD Birla, was a part of the Birla Jute
Manufacturing Company since the beginning.By the time he finished college, he was
already in charge of Birla Jute which had suffered economic downturns and wars.
Madhav changed the company from Birla Jute Manufacturing Company to a company
with activities across a wide spectrum of industries. In MP Birlas time, Birla Corporation
and the other businesses under Birla Group gained significant power and stance in the
cement, auto trims, steel, and building materials. When he died in 1990, his wife,
Priyamvada Birla took over as the chairman of Birla in 1998 and changed the name to
Birla Corporation Limited.Priyamvada is known for her active roles in the community,
healthcare, and education.

KUMAR MANGALAM BIRLA

Details

Date of Birth: June 14, 1967

Company: Aditya Birla Group
Education: MBA, London Business School
Board Membership:
Chairman, Aditya Birla Group
Director, Central Board of Directors at Reserve Bank of India
Chairman, Board of Trade
Chairman, Ministry of Company Affairs Advisory Committee
Profile:
A qualified chartered accountant and MBA, Kumar Mangalam Birla took over as

Chairman in 1995 at the age of 28, after the sudden demise of his father, noted
industrialist Aditya Birla after whom the group is named.
When Kumar Mangalam Birla assumed the mantle at the Aditya Birla Group, doubts
were raised about his ability to handle a giant business house with interests spanning
viscose, textiles and garments on the one hand and cement, aluminium and fertilisers
on the other. But he proved his sceptics wrong. He brought in radical changes, changed
business strategies, professionalised the entire group and replaced internal systems.
Kumar Mangalam reduced his group's dependence on the cyclic commodities sectors
by entering consumer products.
Under his leadership, the Aditya Birla Group, apart from consolidating its position in
existing businesses, also ventured into sunrise sectors like cellular telephony, asset
management, software and BPO.
Kumar Mangalam Birla also holds several key positions on various regulatory and
professional boards, He has won several honors. Major among them include The
Business Leader of the Year (2003) by The Economic Times, Business Man of the Year
- 2003 by Business India, and The Ernst & Young Entrepreneur of the Year - India in
2005.

History:
He got involved in his family business when he was only 15. He was tutored by his
father, sitting in on board meetings and asking him questions afterwards. He later
looked after the cement business of Grasim.
He went off to London to study for an MBA when he was 22. When he came back, he
was uniquely qualified because he had studied chartered accountancy, had a
commerce degree and an MBA.
Once his father was diagnosed with cancer he made a conscious effort at fast-tracking
Kumar on the way to chairmanship.
He developed his own style, which is more group oriented aimed at motivating groups of
people. He transformed and added to his fathers empire with his knowledge, passion
and entrepreneurship.

Ideologies of Kumar Mangalam Birla

India's most successful young entrepreneurs, Kumar Mangalam is a shy and

modest man.

IHe is tagged as an agent of change and has driven against the stream to bring
about marked changes in the functioning of Aditya birla group.

IPassion, he feels, is an important tool to achieve success, as it brings a certain

amount of discipline, sustainability, the fact that you can be much more productive,
much more lateral in the way you think, about the business you are doing.

IKumar believes in profitable growth, and wishes to undertake only those streams
of business, where he can see himself excelling to the top position in the future.

IHe is an inspiration to budding entrepreneurs and managers, all over the world.

Early Life
He was born on June 14, 1967 in a Marwari business family, to Aditya Vikram
Birla and his wife, Rajashri Birla. He has a sister, Vasavadatta.
He is a fourth generation member of the business family and spent most of his
childhood in Mumbai and Kolkata. He was brought up in a high-pressure
environment which constantly made him conscious of his family name, wealth
and the responsibility attached with it.

After completing his school education, he received his B.Com degree from the
University of Bombay. Later he became a Chartered Accountant from the
Institute of Chartered Accountants of India.
Then he went abroad for further studies and completed his MBA from London
Business School, London, UK

Beginning of Kumar Mangalam's Career

At the time Kumar took over The Aditya Birla Group, had already become a giant
business house, dealing in viscose, textiles, garments, cement, aluminum and
fertilizers. He brought in radical changes, by changing business strategies,
professionalizing the entire group and replacing internal systems.
Through entering into consumer products, he effectively reduced his group's
dependence on cyclic commodities. Along with maintaining the group's name in present
sectors, he also ventured into sunrise sectors like cellular telephony, asset
management, software and BPO.
Business record
Mr. Birla took over as Chairman of the Group in 1995, at the age of 28, after the
untimely demise of his father. As Chairman, Mr. Birla has taken the Aditya Birla Group to
an altogether higher growth trajectory. In the 20 years that he has been at the helm of
the Group, he has accelerated growth, built a meritocracy and enhanced stakeholder
value.
In the process he has raised the Groups turnover from US $2 billion in 1995, to US $41
billion today. Mr. Birla has restructured the businesses to emerge as a global/national

leader in the sectors in which the Group operates. He has made 36 acquisitions in 19
years in India and globally, the highest by an Indian multinational in India.
The acquisition of Novelis, a global metals major, in 2007, the second largest acquisition
ever by an Indian company, led to a new found respect for Indian companies and stoked
a higher level of interest in the country as well. The subsequent acquisition of
Columbian Chemicals, a US-based company and the worlds third largest carbon black
manufacturer positioned the Group as the No. 1 player in this sector, given its own
sizeable carbon black operations today. Likewise, the acquisition of Domsj Fabriker, a
leading Swedish speciality pulp manufacturer enables the Groups Pulp and Fibre
business to further consolidate its global position.
Besides these, over the years Mr. Birla has acquired manufacturing plants in Canada,
China, Indonesia and mines in Australia, and set up new plants in Egypt, Thailand and
China. Alongside, he has expanded capacities in all of the Groups manufacturing units.
In India as well, he has made major acquisitions, the most notable being the Cement
division of Larsen & Toubro, Jaypee Cement (MP & Gujarat), Indal from Alcan, Madura
Garments from Coats Viyella, the Chlor Alkali division of Kanoria Chemicals and Solaris
Chemtech Industries.
Under his stewardship, the Aditya Birla Group enjoys a position of leadership in all the
major sectors in which it operates. Over the years, Mr. Birla has built a highly successful
meritocratic organisation, anchored by an extraordinary force of 120,000 employees
belonging to 42 different nationalities. The Aditya Birla Group has been ranked fourth in
the world and first in Asia Pacific in the Top Companies for Leaders study 2011,
conducted by Aon Hewitt, Fortune Magazine and RBL (a strategic HR and leadership
advisory firm). The Group has topped Nielsen's Corporate Image Monitor 2014-15 and
emerged as the Number 1 corporate, the 'Best in Class', for the third successive year.
A firm practitioner of the trusteeship concept, Mr. Birla has institutionalised the concept
of caring and giving at the Aditya Birla Group. With his mandate, the Group is involved
in meaningful welfare driven activities that distinctively impact the quality of life of

weaker sections of society, surrounding hundreds of villages that are among the poorest
in India, Thailand, Indonesia, Philippines and Egypt.
In India, the Aditya Birla Group is engaged in 5,000 villages, reaching out to 7.5 million
people annually and making a difference to their lives through meticulously conceived
projects focusing on health care, education, sustainable livelihood, infrastructure and
social causes. For instance, the Group runs 42 schools which provide quality education
to 45,000 children. Of these, over 18,000 children receive free education. Additionally,
over a 100,000 youngsters benefit from bridge educational programmes and vocational
training. Its 18 hospitals tend to more than a million villagers. In line with its commitment
to sustainable development, the Group has partnered with the Columbia University in
establishing the Columbia Global Centres Earth Institute in Mumbai. To embed CSR as
a way of life in organisations, the company has set up the FICCI Aditya Birla CSR
Centre for Excellence in Delhi.

Awards & Achievements

In 2003, he was conferred The Business Leader of the Year by The Economic
Times and Business Man of the Year by Business India.
In 2005, he received the honor of The Ernst & Young Entrepreneur of the YearIndia.
In 2007, he was named the NDTVs Global Indian Leader of the Year and The
Most Socially Responsible Leader by Outlook business magazine.
In 2008, he received the JRD Tata Corporate Leadership Award from AIMA. The
same year, he also won The Corporate Role Model Award presented by Amity
International Business School.
In 2009, he was presented the Entrepreneur of the Decade Award by Bombay
Management Association.
In 2010, he became the CNN-IBN Indian of the Year Business. Same year, he
was also named the Business Leader of the Year by the All India Management
Association.
He has received the honor of being the World Economic Forums Young Global
Leader, NITIEs Business Visionary, and the Bombay Management
Associations The Management Man of the Year.
He was also awarded the D. Litt (Honoris Causa) Degree by The Banaras Hindu
University. He received The Honorary Degree of Doctor of Science (Honoris
Causa) from the G. D. Pant University of Agriculture & Technology, Pantnagar,
for his invaluable contribution to the field of business administration.

Major Works
One of his most significant works is the radical changes he implemented in the
group as the Chairman of Aditya Birla Group. He changed business strategies,
professionalized the entire group and accelerated the growth of the
organization over the years.
As a philanthropist, he is actively involved in meaningful welfare driven activities
that distinctively impact the quality of life of the weaker sections of society in
numerous countries around the globe including India, Thailand and Egypt.

Future plan

Kumar Mangalam Birla and family plan to invest Rs 500 crore in groups
food and grocery business
MUMBAI: Aditya Birla Group chairman Kumar Mangalam Birla and his family plan to
invest Rs 500 crore in the group's food and grocery business and increase its
authorised capital to Rs 750 crore.
Aditya Birla Retail (ABRL) has passed a board resolution to issue shares on a
preferential basis to either Kanishtha Finance & Investment or RKN Retail, promoted by
Birla, his family and some closely-held companies of the family, the privately-held
company said in a filing with the Regis ..
"The issuance and allotment for shares up to Rs 500 crore will be in one or more
tranches within a period of twelve months," the filing said. The additional capital will help
the company meet its capital expenditure needs and refinance some of its debt. "The
board resolution was related to an enabling provision to allow the company increase the
authorised capital to meet its general corporate expenses in the ordinary course of
business and also to refinance its existing debt portfolio," said Pra ..

ABRL the fourth largest supermarket chain in the country after Future Group,
Reliance Retail and D'Mart has decided to increase its authorised capital to Rs 750
crore from Rs 390 crore now.

It has accumulated losses of Rs 5,320 crore since inception over 9 years ago. For the
year ended March 2015, it managed to reduce its losses by 5% at Rs 571 crore. The
company posted Rs 2,893 crore sales for 2014-15 and ended the year with 482 'More'
branded supermarkets and 16 hypermarkets,

Current scenario

MUMBAI: Kumar Mangalam Birla is set to tighten his grip over Century Textiles &
Industries and Century Enka by soon taking over as chairman of the two companies
owned by grandfather Basant Kumar Birla.
Both companies are scheduled to hold their board meetings on May 5, where Kumar
Birla is likely to be made their chairman, two people with knowledge of the matter told
ET. Also, his mother, Rajashree Birla, is likely to be inducted to both boards, they said.
BK Birla will become chairman emeritus.

Succeed in business
..

No other business group spells Marwari enterprise and success as much as

the Aditya Birla group. The man at the helm, Kumar Mangalam Birla, explains
the principles and practices that have shaped its success

The name Birla is synonymous with the spirit of enterprise and the dizzying
heights of success achieved by the Marwari community in the world of
business.
As the leader of the $40 billion multi-diversified conglomerate, the Aditya Birla
Group, Kumar Mangalam Birla, 46, has steered the empire earlier headed by
his iconic father Aditya Vikram, creating what is today an Indian multinational
straddling 36 countries in businesses as diverse as metals, carbon black,
viscose staple fibre, mobile telephony, cement and fertilisers, among others.

The Aditya Birla Group stands as an important testimony to the manner in

which a traditional Marwari business empire has transformed into a modernday business group, embracing top-notch professionals across the world
while, at the same time, remaining deeply in touch with its traditional values.
In this email interview, Birla dwells on the factors which shaped his business
philosophy, the mix of tradition and modernity and the Birla style of
management. Excerpts:
On being a Marwari and how it has shaped him as a business person
Value creation, the culture of productivity, efficiency, prudence in financial
management and the parta system, where you worked on a daily profit and
loss account, are among the traits that I clearly saw in the Birla family. These
have been great enablers which, with time and technology, one has been able

to hone further.
I do believe that most of these principles are embedded in traditional Indian
entrepreneurs. When you grow up in a business family, subconsciously a lot of
learning happens. It might just be catching conversations across the dining
table. And all of that influences you.
On the balance between traditional management and modern
practices
The control and command chain, extremely hierarchy-oriented, where
information is power and seniority is in terms of years, formed the major
planks of the traditional management style. This had to change because the
business context has changed dramatically. Of course, we carry forward the
family legacy of values, the trusteeship concept of management, the
philosophy of building businesses for the long haulall of which are
invaluable.
Our continued thrust is on ensuring that we remain a meritocratic
organisation. Today, we are a multi-ethnic, multi-dimensional group with a
bench strength of 1,36,000 committed people, spanning 42 nationalities,
across six continents.
As our group continues to expand globally, we recognise fully well that we
have to be contemporary and move with the times.
We have embraced most modern management practices. We lay big bets on
people, providing them with unparalleled opportunities, dynamic challenges
and an environment that is professionally rewarding and personally fulfilling.
In a highly competitive world, high-performing teams and individuals,
supported by a strong performance culture, are the cornerstones of all that we
seek to achieve.
On professionalisation of management and whether that is integral
to business groups
This is not an option. The changing business landscape and the globalisation
process, with competitive pressures increasing across every business, have
made the professionalisation of management a compulsion. We have had an
edge. Way back in the early 1980s, my father, a visionary, had already begun
the process, putting India on the global map by setting up world-class

companies.
For us, the professionalisation of management includes not only the induction
of the best talent but also a culture that stokes entrepreneurial drive, thinking
afresh across all levels, to be a learning and growing organisation that is
constantly creating value for our multiple stakeholders. Our leadership is
inclusive and has a penchant for collaborative and innovative solutions and for
new ways of working. This is so that our companies, our products and our
services are on our clients and customers radar all the time and we remain
competitive.
On the biggest influences in his business style and learnings
My father, Aditya Vikram Birla, is my greatest guru. And my learnings: There
is no substitute to smart hard work. Create leaders. Embrace change.
Innovate constantly. And, finally, the quality of your future depends entirely
upon the quality of your imagination, of what that future can be, today.

Growth year
Kumar Mangalam Birla's business has grown steadily in the downturn because of the
scale and capacity he has built in the last five years
With the recent announcement to acquire Jaypee Cement's 4.8 million-tonne cement
plant in Gujarat, Aditya Birla Group's soft-spoken promoter and chairman, Kumar
Mangalam Birla, has takenUltraTech Cement within striking distance of its nearest
competitor to grab the top slot in the cement sector.
After the deal, UltraTech Cement's domestic capacity will rise to 56 MT, and with more
projects underway, the company will reach 70 MT in annual capacity by 2015. Its closest
rival Holcim, the Swiss cement maker which controls Ambuja Cements and ACC, will
have an annual capacity of 65 MT by then, up from 57 MT now.
Birla's steadfastness in growing the business is reflected in the fact that when he took
over the reins 18 years ago, the group's cement capacity was a mere 3.5 MT, way
below ACC and Ambuja Cements' 11.5 MT. In the interim, the Birla group companies

more than caught up with ACC and Ambuja's capacity. The period also saw Birla
growing his group's revenue to over $40 billion from $2 billion.
There has been a lot of action in the group in the last five years after Birla set the goal
to more than double revenue to $65 billion by 2014-2015 from $29.2 billion in 2007-08.
The economy was on the upswing then, growing at over 9 per cent annually. The
group's strategy was to maintain global leadership in what had been its mainstayviscose staple fibre and carbon black- and gain or retain dominant positions in
businesses such as cement, telecom, aluminium and fashion retail in the domestic
market.
The group's cement arm, UltraTech, grew its revenues nearly four-fold to Rs 21,319
crore in FY2013 from Rs 5,626 crore in FY2008. Nearly one-third of its present capacity
was added around this time, while the company's net profit grew 165 per cent to Rs
2,677 crore in the period. This growth came even as the global economy was going
through a meltdown following the collapse of US-based investment bank Lehman
Brothers in 2008, and economic growth in India had fallen to its lowest in a decade at 5
per cent in 2012-13. But there was no dampening of ambitions. "We are aiming for the
next 20 to 30 years. So, I don't think the aberrations of one or two years will change our
ambition," says Birla in an interview following UltraTech's announcement to acquire
Jaypee Cement's Gujarat unit.
Spreading business
At Hindalco Industries, expansion is underway to increase aluminium capacity to 1.3 MT
by 2013-14 from 0.6 MT in 2008-09. Mahan at Singrauli in Madhya Pradesh, the first
metal smelting plant of the $5.5-billion greenfield expansion project, went on stream
early this year.
The project also includes a bauxite refinery in Utkal in Orissa to meet the alumina
requirement of the Mahan plant and an integrated aluminium production facility called
Aditya in Orissa. Both the plants are expected to complete in the current financial year.
Hindalco's nets sales increased 34 per cent to Rs 80,192 crore, whereasnet profit grew

37 per cent to Rs 3,026 crore over five years. The growth, though modest, can be
considered respectable considering aluminium prices have nearly halvedfrom the peak
of $3,271 a tonne in July 2008 to $1,754 a tonne now. The expansion at Hindalco was
partly also spurred by billionaire Anil Agarwal-promoted Vedanta group expanding its
installed metal smelting capacity to 2.3 MT per annum from 0.34 MT five years ago.
While Vedanta overtook Hindalco in terms of installed capacity, Hindalco is likely to
overtake it in terms of production by the end of 2013-14 as it plans to soon commission
its upcoming facilities. In contrast, Vedanta's 1.25 MT smelting plant in a special
economic zone in Orissa has not been commissioned yet as government approvals are
awaited.
"He (Birla) realises that he has to build assets which will give him cash and build future,"
says investment banker VallabhBhansali, founder of Enam Securities which he sold to
Axis Bank in 2010. Bhansali knows the group well as he has done business with three
generations of the Birla family.
His words ring true for the group's telecom business, Idea Cellular. The mobile-service
provider has now become India's 3rd largest operator by revenue from number seven in
2007-08 with a subscriber base of 125 in the quarter ended June 30, 2013, a more than
five-fold increase from 24 million in 2007-08. The group invested over Rs40,000 crore in
this period in equipment and network as it became a national operator from a regional
one. As a result, Idea's net sales grew 233 per cent to Rs 22,407 crore in the five years
to 2012-13. Although Idea's net profit declined 3 per cent to Rs 1,010 crore as
depreciation costs increased due to high investments in equipment, the company's
market value grew 10 per cent to Rs 37,545 crore in the five years. In comparison,
BhartiAirtel's market value fell 30 per cent in the period. Last week, Idea overtook
UltraTech to become the group's most valued company with a market capitalisation of
Rs 53,830 crore.
Costcontrols
While expanding at breakneck speed, the group has also managed to keep its costs
under

control

and

generate

steady

source

of

revenue.

For

instance,

Hindalco'saluminium trades at a premium to the LME price-the premium ranges up to

$200-400 a tonne. The company has also been able to increase the share of valueadded products in the portfolio which help in earning higher realisation per tonne.
The company's Renukootaluminium plant is another key source of revenue with Ebidta
(earnings before income, depreciation, tax and amortisation) margins of almost $1,000
per tonne. The fully integrated operation-it produces caustic soda (used to make
aluminium), has captive bauxite mines, operates refining and smelter facilities and
generates power from captive plants- forms the foundation for the company's high
(standalone) profitability.
"Due to its low cost of production, even if the last of the plants in the world make losses,
this (Renukoot) plant will still be making profits," says Manish Sonthalia, fund manager
for MotilalOswal Asset Management Company. If all goes according to plan, Hindalco
should be able to double its present Ebitda in the next four years, he adds.
The group has managed to implement stringent cost controls at UltraTech as well.
Analysts say since UltraTech's plants were relatively new, consumption of fuel and
power was lower, which helped it keep costs low. Power and fuel costs account for 2025 per cent of net sales. Another factor that has helped in keeping costs low is the panIndia presence of UltraTech. By putting up plants across the country, UltraTech has
been able to keep logistics costs under check, leading to over 20 per cent Ebidta
margins which is close to those of Ambuja Cements (one of India's lowest-cost cement
producers).
Brand power
Like Ambuja, UltraTech has also been able to command better price (Rs 3-4 per 50 kg
of cement) because of its brand equity. All this has helped the company increase its
cash flow from operations from Rs 1,450 crore in FY09 to Rs 3,660 crore in FY13,
which has made funding expansions and acquisitions easier. Notably, the company's
debt level is low-net consolidated debt stood at Rs 2,450 crore at the end of FY13,
resulting in debt-equity of just 0.16.

Idea Cellular too enjoys strong brand recall. "Sweating of assets has been high for Idea
Cellular, leading to high turnover-capex ratio. With cost-efficient operations, it has in turn
led to higher cash flows for Idea," says Sonthalia of MotilalOswal Asset Management
Company.
Better allocation of capital and focus on enhancing shareholder value among other
things have seen the combined market value of the group's listed entities rise 15 per
cent to Rs 144,000 crore in the five-year period.
However, there are a few sore points for the group. Birla has not achieved significant
success in growing the group's supermarket chain called More. The company entered
the business through acquisition of South India-based retail chain Trinethra in January
2007 but has not been able to achieve breakeven yet. In about the same time,
MukeshAmbani-promoted Reliance Retail has become the number one retailer in the
country and has achieved operational profitability.
In the financial services business, while the group has gained good ground in life
insurance and the asset management segments, it is yet to figure among the top three
players. As other players in the segment pull up their socks, shareholders will be keen
to see how Birla gears up for this challenge.

Product

MUMBAI: Kumar Mangalam Birla is set to tighten his grip over Century Textiles & Industries and Century
Enka by soon taking over as chairman of the two companies owned by grandfather Basant Kumar Birla.

Both companies are scheduled to hold their board meetings on May 5, where Kumar Birla is likely to be
made their chairman, two people with knowledge of the matter told ET. Also, his mother, Rajashree Birla,
is likely to be inducted to both boards, they said. BK Birla will become chairman emeritus.