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Newsmaker: Keshub Mahindra


Soft-spoken, patient, affable and principled, Keshub Mahindra is perhaps India’s last gentleman entrepreneur. For his nephew, Anand Mahindra, Keshub is “M&M’s hidden weapon”.

It is Keshub’s re-engineering of the Mahindra shop floor, as well as its DNA, that has helped the conglomerate and its ‘federal group of companies’ restructure their competitive core and innovativeness. From an engineering and manufacturing focus in the 80s to getting into services and automobiles, Keshub Mahindra’s adaptability and pragmatic world view have made him stand out in the Bombay Club. The decision to exit almost nine to ten business verticals within the company portfolio, from oil drilling to elevators, was deliberate. If you cannot be a world beater or a technology driver, what is the point, his thinking seemed to be. Instead, his philosophy was that it always pays to refocus around a smaller group of businesses for global scale.

It seems to have worked. Last year, M&M sold more tractors than anyone else in the world. Despite intense competition, M&M still has a 59 per cent market share in the domestic utility vehicle segment.

Keshub’s non-conformist ideas took him to the US for higher studies when most of his peers were eyeing Oxford or Cambridge. The Wharton education seems to have shaped his world view. In the mould of large American corporations, he too delegated responsibilities to his managers. The three main businesses and finances of the group were all mandated to key lieutenants. KJ Devasia rose from within the ranks and grew the tractor business; Allan Durante headed the sports utility vehicle segment until he recently retired in Goa, lured by his passion for football; Arun Nanda grew the infrastructure as well as the holiday businesses; Bharat Doshi, too, became a top CFO of India Inc.

“To me, the value system he inculcated in the group and his professionalism are his greatest legacies,” remembers Nanda, a long-time confidante and colleague. Keshub Mahindra was empowering professionals when family businesses were run solely on the promoter’s discretion. “Even when Mahindra Holidays and World City SEZ Project were going through difficult phases, he stood by me like a rock, never questioning my intentions.”

By the mid 80s, Keshub had initiated the group’s transformational journey. Forty years after the steel-trading company, Mahindra and Mohammed took baby steps in Ludhiana, Keshub was already thinking of taking his father’s business empire far beyond tractors. He hoped to merge the Indian Aluminium Company, the Indian subsidiary of Alcan, with M&M. The board agreed but the government vetoed the plans.

The government often threw a spanner in the works with draconian rules, but Keshub never bowed to pressure. “Despite his run-ins with the Janata Party government of Morarji Desai, he never compromised on his principles and values,” recalls Ravi Kulkarni, senior partner at law firm Khaitan & Co, and also an M&M board member. “In 1980, he took the government to court when they capped managerial remuneration, even as none of his peers publicly supported him. He then won the case, and then stepped down as managing director,” he adds. “This spirit,” says Kulkarni, a legal advisor to the Mahindra group since his junior lawyer days 20 years ago, “makes him a father figure for an entire generation like mine.”

For JJ Irani, the former boss of Tata Steel, Keshub has always been a stickler for details. Irani interacted with Keshub Mahindra closely when JRD Tata got his ‘old friend’ on the Tata Steel board, even though both Tatas and Mahindras would compete in the automobile market. Mahindras even have a small speciality steel division in Mahindra Eugene. “He can be your good friend socially, but inside the boardroom it would never cloud his judgement. He was a friend of Russi Mody and JRD, but when Tata Steel faced a management crisis with Mody, Keshub’s focus on corporate governance was impeccable,” he fondly recalls.

Despite these heady accolades, there is one thing that still haunts Keshub. He was the chairman of Union Carbide’s Indian arm when the horrific accident at the Bhopal plant took place. In 2010, he was given a two-year jail term but was released immediately on bail. It may possibly be the reason why the Padma Bhushan was never awarded to him.

At 88, he is the longest-serving board member in corporate India but has relinquished his throne to M&M’s crown prince, Anand Mahindra.