The Hindu : Business : Murugappa Group: Alagappan to head Corporate Board

Online edition of India's National Newspaper
Thursday, Oct 26, 2006
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Murugappa Group: Alagappan to head Corporate Board

K. T. Jagannathan

Will quit the boards of listed companies of the group

M. A. Alagappan

CHENNAI: M. A. Alagappan, Executive Chairman of the Corporate Board of the Chennai-based $1.6 billion Murugappa group, said that the group would aim at doubling the turnover and bottom line in three years.

In a conversation with The Hindu, Mr. Alagappan, who assumed charge as Executive Chairman of the group on Wednesday, asserted that the group could achieve much more than what it had done hitherto. Mr. Alagappan succeeds P. S. Pai, who had proceeded on leave preparatory to his retirement.

The combined turnover of the group increased by 17 per cent to Rs. 7,340 crore ($1,630 million) and the net profit by 45 per cent to Rs. 800 crore ($177 million) in 2005-06. The capital expenditure of the group rose from Rs. 260 crore to Rs. 430 crore. The combined market capitalisation of the listed companies of the group crossed the $2-billion mark. The group has 29 registered companies.

Asked if his ascension to the top slot marked a change in thinking within the group, he said, "there is no shift or change. I was the Vice-Chairman of the Corporate Board and it was logical that I took over." The Murugappa group, it may be recalled, had, for some time, seen outsiders head its Corporate Board. Mr. Alagappan said he was involved in the strategy of the group for the last six years as Vice-Chairman of the Corporate Board and also as Director (Strategy).

Mr. Alagappan said he would relinquish charge of the chairmanship of Tube Investments of India and Cholamandalam DBS Finance. He would also quit the boards of listed companies of the group. Asked if he was following any convention by doing so, he said Mr. Pai adopted this strategy.

On his agenda for the group, Mr. Alagappan said various businesses of the group like fertilizer and sugar had long-term growth strategies. "My job will be to push those strategies and ensure that they achieve these," he added. Asked if the group would make a foray into the banking field under his leadership, he reiterated his known stand that non-banking finance companies had a big part to play in the economy.

Meanwhile, A. Vellayan, currently Director (Marketing), assumed charge as Vice-Chairman and Director (Strategy) for the group.

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