MUMBAI: Godrej Enterprises Group (GEG) is looking to infuse about Rs 4,000 crore into its businesses as it aims to streamline 14 verticals besides unlocking value, especially in its vast real estate holdings, said executive director Nyrika Holkar in her first interview since the Godrej group realignment in April.
“We are now focused on faster decision making and are doubling down on building our multiple businesses to make them scalable. It’s also important that we sharpen our organisational culture to be agile and performance-focused,” she said in the first public comments about GEG’s growth strategy.
The money will go into the group’s “consumer-first” and “nation-first businesses” as it aims to establish cutting-edge engineering facilities as well as building furniture label Interio into a lifestyle brand, she said.
The consumer-first businesses include furniture, security, locks. The nation-first ones include aerospace and process engineering. The Rs 16,000 crore group’s 14 verticals include aerospace, appliances, engines and motors, energy, locks, security, building materials, construction, healthcare equipment, durables, furniture and interiors, among others. GEG’s biggest revenue generators are the appliances and interiors businesses, followed by locks and security.
Godrej Enterprises Group will be exploring ways of making its landholdings in Mumbai value accretive, said top executives close to the development. The group has about 3,400 acres in the Mumbai Metropolitan Region, most of it in and around the suburb of Vikhroli. “We see Vikhroli development as one of the key focus areas for the next few years,” Holkar said.
“And we also see our consumer-facing businesses as drivers of growth, supported by the strong equity of the Godrej brand,” she said. “Enhancing the brand experience is a key priority for me. While trust is the foundation, we need to create a more aspirational experience.”
Deliberations over the division of assets did take a while, she said. Holkar led the GEG side in the talks that went on for more than four years, with the most complex issue being that of the Godrej brand.
The focus was on “being able to cater to the needs of all members of the family and to stand ground on the issues that were most important to us,” she said. “The brand negotiation was the toughest and most complex but I think we landed in a place that the family was comfortable with.”
Holkar said the realignment was the culmination of talks among all family branches.
“We had to be thoughtful about our choices to optimise for the family, the brand, and key stakeholders,” she said. “We also wanted to ensure there were no disruptions to operating businesses of either group.”
The Godrej Group was split between two sets of cousins earlier this year — GIG, run by brothers Adi and Nadir Godrej, and Godrej Enterprises Group (GEG), which belongs to siblings Jamshyd Godrej and Smitha CrishnaGodrej. Holkar is the latter’s daughter. Jamshyd Godrej is chairperson and managing director of GEG.
“Luckily for us, the businesses have always been managed independently,” Holkar said. “So it was, in a sense, a realignment along current management lines. We approached it with the principle of equity, but didn’t really look at ascribing a valuation.”
She cited Interio, which Holkar said was a market leader in furniture and furnishings and operates across the value chain, from home to workspaces to healthcare and to education, “all growing sectors today”.
GEG has made significant investments in the business – Rs 2,600 crore in the Khalapur and Shirwal plants in Maharashtra—in engineering and in the front end.
“We are looking to build it (Interio) out as an aspirational lifestyle brand and are looking at all consumer touch points, because the whole consumer experience piece across all touch points is very critical, and this is something that I am personally very passionate about,” Holkar said. “So we are looking at product, we are looking at retail experience, we are looking at redoing 200 stores across the country.”
GEG is also studying the online experience as it looks to pivot to an omni-channel experience, given that customers are comfortable buying through such avenues now. The group also wants to improve the consumer experience across all touch points and build a new design centre for the aerospace business, she said.
“We feel that ease and convenience is a very important driver,” Holkar said. “And we need to equip our teams, who are the frontline, with the right kind of information, the right kind of digital tools and the ability to resolve customer issues the first time round. We are working on a service transformation across our consumer-first businesses.”
Given that India is aiming to achieve net-zero status on carbon emissions by 2070, GEG plans to do its bit on that front as well. “Construction and use of the built environment accounts for 40% of greenhouse gas emissions, so I think a lot of thought has to be put into not only how we construct but also how we utilise the built environment over time,” Holkar said.
