SPARK OF THE CORPORATE
The best things in life are done when you are hungry for more business...
All Kushal Pal Singh Teotia, hailing from a Jat family of the erstwhile United Provinces (India) with a history of military and public service by its members, wanted to do when it was time to make a career decision was to become an aeronautical engineer. If he had pursued his original aspiration, his would have been just another story of a retired life after years of service in the aviation sector. But destiny had scripted something else for him. Or should we say, destiny just forced him onto a different path altogether from which he scripted a story of success like India, as indeed most of the developing world, had never heard of or seen before.
After his initial discomfiture as a cavalry man in the British-led Indian Army (before India's independence), followed by a period of struggle coinciding with his joining DLF in 1960 which forced DLF to take up manufacturing of electric motors and automotive batteries. After battling for years against the impediments to land acquisition owing to the regulations (under the Land Ceiling Act), his perseverance in getting through an infamous bureaucracy and braving the omni-present political fire, his people skills - immense powers of pursuasion and dealing ability- and, above all, a chance meeting with the son of the then prime minister of the nation who would, not long after this incident, himself become prime minister, created a real-estate hotspot out of a dry, barren, scrubby plain in the state of Haryana, just across the border from New Delhi, which would go onto be known as not only the birth-place of India's BPO industry but also, significantly, lead to the birth of the entire urban-development policy of India today.
Along the way Singh master-minded the creation of a real estate behemoth (market capitalization of around USD 7 Bn) which is today the world's largest real estate company in terms of revenues, earnings, market capitalization, and developable area!
Singh was born (August 15, 1931) into a Jat family of Bulandshahar in present-day Uttar Pradesh state of India. His father, Chaudhary Mukhtar Singh was an advocate by profession, so it was only natural that K.P. Singh was driven toward academics and, hence, the aim to make an appropriate career after completion of his studies. He graduated (Bachelors) in Science from the Meerut College (U.P.), and left for the UK to pursue aeronautical engineering. While in the UK, it so happened that he was selected to the prestigious Indian Army, by the British Officers Services Selection Board, UK - as a result he joined the Indian Military Academy at Dehradun (India).
His initial army days were restless as the engineer in him kept surfacing every now and then and he was constantly contemplating his exit from the army until the issue was settled by a Senior Army officer, Col. Baljit Singh. The seniors in the army had got wind of KP Singh's plan of quitting the Army and resuming his aeronautical engineering in London. Col. Singh summoned him and reminded him of the family history of serving the military as well as the stigma that haunts someone who had quit the army mid-way through his training. The meeting with this amiable senior army officer left an indelible mark on the young KP Singh, in that although the meeting was expected to bring at the least a reprimand - for Singh had also planned to run away from the military academy by boarding a train from the nearby railway station, in which case he would be violating the basic norms of the academy- but instead of cashiering the young man for his indiscretion, Col. Singh very politely, and articulately, brought forth the ideals of the services and their value to the nation as indeed the consequences if KP Singh had run-away, and impressed upon him to stay back. This is where KP Singh learnt his first lessons of man-management and the discipline that he said have helped him in business years later. Singh stayed back and served in the military, and was later on commissioned into The Deccan Horse -a renowned cavalry regiment of The Indian Army.
Sometime later, KP Singh married Indira, the daughter of Chaudhary Raghvendra Singh, a former civil servant who had the vision in 1946 itself to foresee that the impending partition of the nation into India and Pakistan which would result in mass migration of refugees who would need housing, and thus, had founded DLF (Originally Delhi Land & Finance) in the same year. He(Raghvendra Singh) had done this by convincing farmers around New Delhi to hand over their land on the promise of future payment, and borrowing money to develop residential neighborhoods and then selling houses at considerable profit to the influx of new-comers.
Although KP Singh joined DLF only in 1960, the company had completed its dream-run upto 1957 and was on a downward trend as business had slowed down considerably since the state government had granted itself sole development rights for the city, forcing private firms out of the business. There was also another aspect that proved to be a big hurdle for the company. In all the years since its founding, the company had only been able to acquire 40 acres of land, which was infinitesimal compared to the land required for the scale of housing needed to meet the demands of the influx of peoples.
Neither of the Singhs (father-in-law & the son-in-law) gave-in to the adversity brought about by state policy. That real estate would be their prime area of business they had no doubt and would never let go off it. They chose to explore other areas in the interim until the situation became once again favourable to resume the business of their choice. The company ventured into manufacturing of electric motors and automotive batteries following a tie-up with two American companies. Although the venture eventually dithered away, the experience helped KP Singh get acquainted with management techniques in practice at the time in America. Ultimately, the joint venture was merged into DLF Universal in 1979, and KP Singh assumed office as the Managing Director.
Digressing a bit from this period, an incident in 1975 deserves special mention here as it showed KP Singh the light that would illuminate his thinking as well as his thoughts and plans forever after that day. As discussed earlier, the state had taken control of the housing development sector throwing many real estate companies out businesses through an Act which put a ceiling on the extent of land acquisition. This plus the unwillingness of the farmer community in Gurgaon to sell their lands come what might dealt a huge blow to the plan of Singh to revive DLFs real estate business.
Disappointed and disheartened, and at the advice of his father-in-law, Raghvendra Singh, KP Singh had decided to sell his stake in DLF in 1975. His rendezvous with Col. Baljit Singh decades ago had also taught him yet another very important lesson of his life - that one should never run away from challenges in life. So, when friends and well-wishers from outside the family had him rethink about his plan to sell his shares, it was easy for him make the decision that was a life-changer for Singh himself along with hundreds of thousands of many others. One of the well-wishers, KP Singh says, was Y.S. Tayal, the company's then financial advisor, who was well aware of what lay in store for DLF with the advent of rapid industrialization and an ever-increasing population, as also the implications of KP Singh divesting his DLF share-holding. This brief piece of advice from Tayal had its impact on KP Singh, as his thoughts shot back to that nervous meeting with the senior Army officer and his precious words of wisdom of never letting go off your goal in the face of any adversity whatsoever. He quickly realized what a blunder of unimaginable proportions it would have been if he had given-in to his father-in-law's suggestion. Thus clearing his cluttered mind of any misgiving, he held onto his shares and stayed with DLF and kept working at convincing the farmers, helping them in times of need with both advice and other kinds like getting their children admissions in schools and generally being there for them as a family-friend. This modus-operandi of connecting with the lives of the farmers and behaving as one of them had a measurable impact on the future of DLF, as farmers ultimately came forward to sell their unproductive lands to DLF.
KP Singh had found his way out of the immense obstacle of making the farmers, who owned much of the barren lands in and around Gurgaon, see the light in selling their lands, but the other concern - that of acquiring land in the face of regulations- still remained.
As luck would have it, a chance encounter with Rajiv Gandhi, who was then the General Secretary of the ruling Congress Party (his mother, Indira Gandhi, was the Prime Minister of the country), and the two-hour conversation with him (Rajiv Gandhi) was the turning point in the fortunes of DLF and KP Singh. The young Gandhi was impressed by KP Singh vision of transforming Gurgaon, a village with acres and acres of barren land, into a mega-town of high-rise towers, fancy apartments, and malls. The friendship thus formed was to help KP Singh and DLF in the very near future, as Rajiv Gandhi went on to become the Prime Minister of India in late 1984 and helped ease the regulations for land acquisition for commercial constructions, something which he had already facilitated, as General Secretary, by talking the authorities into believing in the vision of Singh for Gurgaon. Much of the inspiration for dreaming of a city that would pioneer a revolution in the real estate sector of the country by becoming the India hub for a host of multinational corporations came from KP Singh's fascination with Jantar-Mantar, the famous historic observatory situated in the heart of New Delhi. Singh says, "The Jantar Mantar gave me the inspiration that if the guy who conceived and made the Jantar Mantar centuries ago could be a forward-looking man, why is it that we can't be forward looking in our development and start to do something ahead of the time?"
Thus, his almost prophetic vision, a shrewd strategy, and a stroke of luck -as we have seen- turned DLF into the property powerhouse that it is today.
DLF's exponential growth story from a mere 40 acres of land-bank in the 1960s to 3,500 acres in Gurgaon transforming it into a dream city that comprises some of India's first modern commercial structures, including offices for General Electric and, more recently, for Swedish cell-phone maker Ericsson and Swiss food giant Nestlé, had its share of pain and agony.
Convincing farmers to sell their barren lands in Gurgaon required him to go out of the way to make a place for himself in their hearts -he attended weddings, even mediated family disputes, and helped out during illnesses to win their trust. Ultimately, he could make them feel he is one amongst them and it would only benefit them immensely if they aligned with DLF and sold their ‘non-agricultural' land to it. Problems relating to regulatory aspects eased to a great extent in the 1990s when the economy was liberalized. But there still remained some problems that DLF had to grapple with. These emanated from a couple state ministers (State of Haryana) who tried to make life difficult for DLF all through the two decades of DLF's humongous growth. Singh says it was more to do with some personal prejudice than anything else. The ministers did everything they could to crush DLF - numerous false allegations, court cases and punitive actions which they indulged in to checkmate DLF.
But under the resolute KP Singh, the company stood firm in the face of such unlikely adversity and went about its endeavour of creating world class real estate facilities for Indians as well the scores of MNCs who had thronged to the country post the opening up of the economy to set-up their back-office operations initially, and who were to later see the business potential that lay unlocked in India. This was also one of the early instances of FDI coming to India, and General Electric was the first company to invest in the country -courtesy KP Singh and his introduction of corporate India to Jack Welch. Soon many others took a leaf out of GE's book, set-up facilities and started operations in India, first at Gurgaon and later on expanding to other cities like Bangalore, Hyderabad and the rest of the country.
By 2006, the company had embarked on an ambitious and multi-pronged mission of expanding beyond its existing horizon of Gurgaon and the National Capital Region (NCR) Delhi, to other parts of India while continuing to add to its Gurgaon glory. It tied up with a host of foreign companies to develop airports (in partnership with Fraport AG, owner and operator of Frankfurt Airport), hotels (Hilton), and industrial estates and urban hubs (Dubai-based developers Nakheel). Another feather in its cap was the ‘Mall of India' in Gurgaon. Work on the 1.8 million square feet (msf) project began in 2006 and it is set for an August 2013 launch. All this meant that DLF had to raise additional capital. It floated an IPO for 10% of the company's shares to serve this end.
DLF went for an initial public offering in 2007 and made about $2.24 billion. It was one of the largest IPOs in India at the time and was soon followed by an upsurge in the market capitalization of the company to a level of $24.5 billion, making Singh and his family one of the richest clans in the world. So much so, that in 2008, he was briefly the world's richest real estate tycoon.
That can only be expected if one looks at the milestones the company has achieved over the years under the leadership of KP Singh. From the time DLF started to build the 3,000 acre DLF City in 1985 to this day, its progression reflects the work of a genius. DLF has kept on besting its efforts by venturing into group housing projects, Grade ‘A' office spaces in Gurgaon, organized retail complexes, the DLF Cyber City in 2003, the launching of premium residential complexes with Golf Links in 2004 (18-hole golf course designed by golfing legend Arnold Palmer), followed by focus on IT parks and next generation malls, hotels and large townships, topped it all up with joint ventures with Prudential for providing life insurance and asset management services, and getting listed on the stock exchanges in 2007, developing India's first luxury mall - DLF Emporio and the largest private-sector residential project in New Delhi - Capital Greens, Automated car-parks, ultimately making an entry into the infrastructure sector with the launch of an 8.3 Km expressway in Gurgaon in 2012.
Presently, DLF has about 100 msf under development and about 400 msf of planned projects encompassing residential, commercial, and retail projects all over the country. The value that KP Singh has created is nothing short of astounding. The land that cost Singh as little as $2000 an acre (at current exchange rates), today sells for about $4 million an acre.
Apart from the fact that he is one of the leading visionaries of the Indian corporate world, his vast experience, business acumen, and people-skills have meant that many other important business as well education bodies have sought his advice and involvement. As a result, he presently holds several positions at various institutions and bodies, some of which are listed below:
K.P. Singh had run DLF with the belief that Corporate Social Responsibility is not just an add-on; rather its business and social commitment were mutually reinforcing and neither can be sustainable without the other. Therefore, he has ensured that DLF constantly endeavours to create sustainable economies to transform stagnant lives of the less fortunate people in the areas where DLF operates into active partnerships through synergized pro-active handholding in areas of infrastructure, education, training, health, and environment.
Thus, we can see that DLF has not lost sight of its social responsibilities as a change agent for accelerating social and economic transformation of the under-privileged segments, and complements the efforts of the state in this regard.
DLF Foundation was established in 2008 as the philanthropic arm of DLF Limited with the express mission of empowering communities and creating opportunities for the underprivileged in areas of education, training and health. A number of Rural Education, Training, Health and Environment initiatives have been taken by the Foundation since its incorporation to ensure sustainable and inclusive growth, which is both environment-friendly and socially uplifting.
The Swapna Sarthak School -an informal school for the children of construction labour was started by DLF way back when work on the first DLF Township had begun and is manned by trained volunteers- conducts classes for children who are ill-equipped to join regular school or those who cannot afford to do so.
DLF's CSR wing continued its efforts on the education front by setting-up DLF Centers of Excellence in 25 villages, partnering with Pratham (an NGO) in 2007. The initiative introduced innovative learning material to the teachers of government schools and community leaders who were involved in the effort. Another initiative was the DLF Labour Hutment scheme that aimed at improving the living conditions of the construction labourers of all their projects by providing them all the basic necessities at the site itself through efficient and effective space management. Instead of constructing makeshift or temporary accommodation for the labourers, DLF sanctioned hefty budgets to build a mix of cemented hutments and dormitories.
Some of the other CSR initiatives that demonstrate what KP Singh believes to be corporate social responsibility include setting-up of Rural Primary Health Care Centres that would provide free medical consultancy, health checkups and subsidized medicines to the villagers. Helping the rural craftsmen, setting-up vocational training centre, facilitating rural mobile libraries, running scholarship programs, and undertaking environmental programs, to name a few.
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