Dynamic House, located on Church Street in the most fashionable part of Bengaluru, is today a pale shadow of the powerhouse it once was.
The headquarters of British Physical Laboratories (BPL), a group which once was a dominant player in consumer electronics and telecom, is back in the news only because of the demise of TP Gopalan Nambiar or TPG, as he was fondly referred to, at the age of 94 on Thursday after a prolonged illness.
Nambiar was the original believer in ‘Atmanirbharata’ (self-sufficiency) and ‘Make in India’ champion, which the current government professes. The Malayalee businessman had returned to India after working in the US and UK. The 1962 Indo-China war had showed up India’s lack of even the most basic manufacturing outside of PSUs.
BPL started in 1963 supplying precision panel meters for the defence forces. It gradually expanded into telecom and office equipment (think EPABXs, switch gears and photocopiers) and medical products (mainly cardiac care related).
For nearly two decades the firm saw only incremental growth. It was the Asiad Games of 1982 which saw the rise of television in India as a medium which propelled BPL into the big league.
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Nambiar launched a range of TVs, including colour television, and slowly expanded into VCRs and other white consumer goods including refrigerators, washing machines, lighting and other small electrical appliances.
It was post the 1991 economic opening up though which provided both a boost and eventually dealt a blow to BPL’s fortunes. The opening up of the economy meant higher aspirations and greater disposable incomes as a rising middle class in India looked beyond the socialist shibbloeths for shiny capitalist goods.
BPL fully capitalised on it and grew spectacularly. At its peak in early 2000-01, the Group had a collective turnover of little over ₹4,300 crore (close to $1.5 billion in then exchange rates), employed around 9,600 people and had 28 manufacturing facilities across the country. More importantly it was profitable.
However, the opening up also meant a rush of international brands mainly Japanese and Korean, who tried to tap the India opportunity.
The likes of LG, Samsung, Sony, Sharp and others came in. To position BPL as a premium player Nambiar hired Big B Amitabh Bachchan as the brand ambassador for the company.
Amitabh, who was making a comeback in showbiz after his company ABCL went under, was reportedly paid one of the highest brand endorsement fee at that time.
Under the slogan ‘Believe in the Best’ BPL looked like it could do no wrong as it grew from strength to strength. BPL had also ventured into the then nascent but eventually lucrative telecom sector which was a natural backward integration as it already manufactured phones and EPABXs. It even bagged the license for the lucrative Mumbai market.
With the Koreans and Japanese consumer durable companies snapping at his heels with their global product range, Nambiar was forced to look for technology partnerships and chose to tie-up with Sanyo, a then Fortune 500 company.
By 2001, Nambiar, who was already 71 and had steered the group for nearly four decades, decided to hand over the reins to his son Ajit even as son-in-law Rajeev Chandrashekar ran the telecom business.
A number of circumstances including leadership change at the top, turbulence at his partner Sanyo, which eventually collapsed, as well as an internal family feud on the control of the telecom business all meant that BPL and Nambiar were in trouble.
Also during the go-go years of growth, Nambiar had borrowed heavily to grow the business. As long as the business was profitable they could service the debt. Increasing competition led to lower margins and eventually losses leading to debt piling up and had to go through debt restructuring.
The family feud between Nambiar and the son-in-law on who had the ownership of BPL Telecom even went to courts and eventually was settled internally. But all of this damaged the group and took away crucial management bandwidth just a time when it was facing onslaught from a slew of international brands. Slowly he withdrew from the day-to-day operations of the Group he had painstakingly built.
Nambiar, a proud Malayalee who would appear in a mundu (dhoti) at major events, always lamented that India had not lived up to its manufacturing potential. Fond of his native state Kerala he also felt that the state could do better on the industrial front.
In one of the last conversations this writer had with him in 2016, when the group had finally repaid all debtors at a great cost of shrinking itself to a very small size, Nambiar lamented that ‘In my home state even before I could inaugurate a factory, the red flag (of Communist worker unions) would be up on it. Unless government supports manufacturing in India, we cannot create enough jobs or prosper here.’
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Though the group today has a presence in consumer durables, medical equipment, renewable energy and solar lighting solutions it is a pale shadow of the powerhouse it once was. TPG who had largely withdrawn from the limelight due to age-related issues always till the end believed in the best and the best was yet to come.