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Havells India's Big BiteA Real Turn around

When electrical goods company Havells acquired Sylvania in 2007, all that it was looking
for was growth and a strong global presence. Instead, it had to tackle with a major crisis at
Sylvania, activated by the global financial disorder. The situation threatened to pull Havells
down, and it had to come up with a smart turnaround strategy. This case study looks at how
Havells pulled it off.
Havells group originated as a small trading business in Central Delhi's Bhagirath Place,
which is a wholesale market for electrical goods. It was promoted by Mr. Qimat Rai Gupta
and Mr. Surjit Kumar Gupta, who commenced their trading operations in the year 1958. A
former teacher in Punjab, the entrepreneur Qimat Rai Gupta bought the Havells brand from
one Haveli Ram Gandhi, thereby moving up from trader to manufacturer.
The Company was incorporated as Havells India Private Limited on 8th August, 1983 under
the Companies Act, 1956 and subsequently the name was changed to Havells India Limited
vide certificate dated 31st March, 1992. This company manufactures electrical and power
distribution equipments ranging from building circuit protection, Industrial & Domestic
switchgear, cables & wires, energy meters, fans, CFL lamps, luminaries for domestic,
commercial & Industrial application and modular switches. Havells owns some of the
prestigious global brands like Crabtree (India Region), Sylvania, Concord: martin, Lumiance,
Claude, Sylvania: Linolite, SLI Lighting & Zenith.
Havells India Limited is a $1.3 Billion leading Fast Moving Electrical Goods (FMEG)
Company and a major power distribution equipment manufacturer with a strong global

footprint. Havells enjoys enviable market dominance across a wide spectrum of products,
including Industrial & Domestic Circuit Protection Devices, Cables & Wires, Motors, Fans,
Modular Switches, Home Appliances, Electric Water Heaters, Power Capacitors, CFL
Lamps, Luminaries for Domestic, Commercial and industrial applications. Its global network
comprises 7000 professionals across 91 branches & representative offices in over 50
countries. Its 14 state-of the-art manufacturing plants in India located at Haridwar, Baddi,
Noida, Sahibabad, Faridabad, Alwar, Neemrana and 7 world class manufacturing plants
located in Europe, Latin America & Africa are manufacturing globally acclaimed products,
synonymous with excellence and precision in the electrical industry. Today, Havells owns
some of the most prestigious global brands like Havells, Crabtree, Sylvania, Concord,
Luminance and Standard. Today, Havells along with its brands have earned the distinction of
being the preferred choice of electrical products for perceptive individuals and industrial
consumers both in India and abroad. Havells offers same quality products for both Indian and
international markets. Social and environmental responsibility has been at the forefront of
Havells operating philosophy and as a result the company consistently contributes to socially
responsible activities. For instance, the company is providing mid-day meal in government
schools in Alwar.
In 2006, Havells acquired European Electrical Equipment manufacturer Sylvanias lighting
business in Europe. This made its presence to be noted globally. SLI Sylvania, which is
headquartered in Frankfurt, is a leading global designer and provider of the lighting systems
for lamps and fixtures.
To be a globally recognized corporation that provides best electrical & lighting solutions,
delivered by best-in-class people.

To achieve our vision through fairness, business ethics, global reach, technological expertise,
building long term relationships with all our associates, customers, partners, and employees.

Customer Delight: A commitment to surpassing our customer expectations.

Leadership by example. A commitment to set standards in our business and

transactions based on mutual trust.

Integrity and Transparency: A commitment to be ethical, sincere and open in our


Pursuit of Excellence : A commitment to strive relentlessly, to constantly improve

ourselves, our teams, our services and products so as to become the best in class.


1958--Commenced trading operations in Delhi.

1976--Set up the 1st manufacturing plant for rewireable Switches and Changeover
Switches at Kirti Nagar, Delhi.

1977--Bought HAVELLS brand.


Set up manufacturing plant for HBC Fuses at Badli, Delhi


First brand to launch energy efficient Innova and Elite


2nd largest manufacturer of Cables and Modular Switches


First in the industry to launch Havells World -a unique retail


1980--Started manufacturing high quality Energy Meters at Tilak Nagar, Delhi

1983--Acquired Towers and Transformers Limited and turned it into a profitably

manufacturing Energy Meters Company in 1 year.

1987--Started manufacturing MCBs at Badli, Delhi in Joint Venture with Geyer,


1990--Set up manufacturing plant at Sahibabad, U.P. for Changeover Switches

1993--Set up another manufacturing plant at Faridabad, Haryana for Control Gear

Products & listed on the Stock Exchange.

1998--Introduced high-end Ferraris Meters in Joint Venture with DZG, Germany

2000-- i. Acquired controlling stake in Duke Arnics Electronics (P) Limited, engaged
in manufacturing of Electronic Meters-Single Phase, Three Phase, Multi Function, Tri
ii. Acquired controlling interest in an industry major - Standard Electricals

2001--Acquired business of Havells Industries Limited, MCCB of Crabtree India

Limited and merged ECS Limited in the company to consolidate its area of core

2002-- Standard Electrical Company and became a 100% subsidiary of the company.
And attained the IEC certification for industrial switchgear and CSA certification for

manufacturing plants

2003--Launched Fans, CFL and Lighting

i. Set up plant at Baddi, HP for manufacturing of Domestic Switchgear.
ii. Set up plant for manufacturing of CFL at existing manufacturing plant
in Faridabad, Haryana
iii. Set up plant for manufacturing of Ceiling Fans at Noida, U.P.

iv. Set up own marketing office in London through our wholly owned
subsidiary company Havells U.K. Ltd.
v. Placed 235 fully convertible debentures of Rs 10 Lacs on M/s. Shine
Ltd., Mauritius for conversion in June, 2006
vi. Attained the CE certificate for CFL


Set up manufacturing plant in Haridwar, Uttaranchal for manufacturing fans


Awarded the KEMA certification by The Dutch Council for Accreditation,

making QRG the only group to attain this certification


Set up R&D Center in Noida H.O

i. Crabtree India merged with Havells India
ii. Added CFL production unit in Haridwar manufacturing plant
iii. Expanded Alwar manufacturing plant for increase of production
iv. Expanded Baddi manufacturing plant and set up an Export Oriented
v. Became 1st Company to get the ISI Certification for complete range of
vi. Started mid-day meal program at Alwar,Rajasthan caters to 10,000
students from 77 schools

i. Set up Capacitor manufacturing plant in Noida, U.P. with the capacity
of 6,00,000 kVAr per month

ii. Acquired the Lighting business of a Frankfurt based company

Sylvania, a global leader in lighting business and the companys
turnover crossed US$ 1 Billion
iii. Warburg Pincus, a global private equity firm and one of the largest
investors in India, invested US $110 million in Havells India Limited.
Havells issued fresh shares to Warburg Pincus, presenting
approximately 11.2% of the fully diluted share capital of the company
iv. QRG Group entered healthcare business by acquiring a majority stake

Central Hospital and Research Centre, Faridabad


Became 1st Indian CFL manufacturers to adopt RoHS, European norms on

Restriction of Hazardous Substances in CFLs


Set up Global Corporate office, QRG Towers at Expressway, Noida


Invested Rs 50 crores in Global Center for Research and Innovation (CRI)


Set up fully automatic plant for Havells Lafert Motors at Neemrana


Changed Corporate BRAND identity

a. Set up fully automatic 2nd unit for Switchgear manufacturing at Baddi
b. Undertook global consolidation of CFL manufacturing plant at Neemrana for
domestic and export purposes
i. Launched Indias 1st HPF CFL
ii. Launched Indias 1st BEE 5-star Rated Fan

i. Set up 2nd unit for Fan manufacturing at Haridwar
ii. Acquired 100% interest in Standard Electricals

iii. Set up Worlds 1st New Generation CMH Lamp Plant

at Neemrana

Launched Havells brand in US & Mexico

v. Entered into Electric Water Heaters business

i. Launched new range of Control Gear Cosmic Star series
ii. Set up new Industrial Switchgear Plant in Sahibabad
iii. Launched Domestic Appliances
iv. Standard Electrical merged with Havells
v. Entered into a Joint Venture with Shanghai Yaming Lighting, China

2012-i. Launched Copper Flexible Cables under the Standard brand

ii. Launched Crabtree XPRO Switchgear
iii. Set up new Lighting Fixtures plant in Neemrana

HISTORY OF HAVELLS ACQUISITIONS -Qimat Rai Gupta bought series of acquisitions, joint ventures and entry into new product
categories. Today, Havells India Ltd is a Rs 7,248-crore company. The journey hasn't always
been smooth, but the roughest patch was easily the 2007 acquisition of German lighting and
fixtures maker SLI Lighting, owner of the Sylvania brand.
SLI was then the world's fourth-largest lighting company and 1.5 times bigger than Havells.
In February 2007, when negotiations with Sylvania's owners took place, some of Havells's
top bosses went to London to fix agreement Anil, Havells's Joint Managing Director and
cousin Ameet reckoned they were paying more than they should. "The next morning, I called
my father," says Anil. "I told him we have paid i3 million (Rs 23.4 crore today) more. He
said that in the big picture, the figure was insignificant." Havells bought Sylvania for i200

million, plus pension liabilities of i35 million.

Havells had a track record of five successful acquisitions, and high growth in its Indian
operations. In 1983, it bought the loss-making Delhi-based Towers and Transformers Ltd and
turned it around in a year. Between 1997 and 2001, Havells also bought ECS, Duke Arnics
Electronics, Standard Electricals and Crabtree India. The last was a 50:50 joint venture
between Havells and the UK-based Crabtree, and Havells later acquired Crabtree's stake in
the JV. India revenues had a compound annual growth rate of 50.08 per cent between
2002/03 and 2007/08. In March 2007, Havells bought Sylvania. And then the global financial
crisis struck.
On 13 March 2007, Havells signed an agreement to acquire SLI Sylvania from its owners. An
international consortium led by Barclays Capital finances the transaction price of 227.5
million Euros. The transaction includes all entities of SLI Sylvania in Europe, Latin America,
and Asia Pacific.
* Havells can keep existing manufacturing facilities in Europe, but will create additional
capacities in low cast India
* Havells substitute Chinese export to Sylvania
* Havells will leverage Sylvania distribution in Europe, USA and Latin America for margin
rich switch gear products
* Sylvania R & D practices can transform Havells
* Havells can use Sylvania multi brand strategy for different markets
* Havells can sell Sylvania brand, except US, Canada, Mexico, New Zealand and Australia In
these countries Sylvania other brand can be sold like Concord, Linolite, and SLI

First quarter results show positive results for both companies Sylvania stand-alone
performance after acquisition has improved. It net revenues stood at Rs 594.6 cr and profit
after tax at Rs 8.5 cr. Havells stand alone profit is up by 40% to Rs 31.6 Cr
Through the 90s, Havells expanded its distribution reach, and went in for foreign
collaborations and product additions through a string of acquisitions: Towers and
Transformers (1983), Electric Control & Switchboards (1997) and Duke Arnics Electronics
(2000). The strategy saw Havells emerge as Rs 1,000-crore Company by 2006, but the
Guptas were thirsting for more.
In 2005, they had bid for the UK-based Electrium, but lost out to Siemens, which bought the
company for 98 million. A year later, the mother of all acquisitions came knocking on the
door when investment bank NM Rothschild brought them an offer from Sylvania. The
Guptas were sufficiently excited as the brand offered Havells a decisive presence in the
world market and help it break into the $1 billion sales league. In March 2007, Havells
acquired the Germany-based SLI Sylvania, the biggest overseas takeover by an Indian
electrical equipment manufacturer at that time.
The first year of operations went off smoothly as the Guptas let the existing management
continues with day-to-day operations. In FY08, Sylvania clocked revenues of Rs 2,948 crore
and profit after tax of Rs 17 crore. But with the recessionary wave sweeping across the US
and Europe, the acquisition went through the wringer. By the end of 2008, the 100-year-old
brand with a footprint across markets in Europe, North and South America had notched up
accumulated losses of 47 million.
A day before the fateful meeting of Sylvanias top managers in January 2009, where the
Havells top management was to discuss a turnaround strategy, the then-CEO and some key

management personnel were given their marching orders. The message that went down the
line was loud and clear: the Guptas meant business. Many people in the trade felt we had
bitten off something that was too large to chew, recalls Anil Gupta, 43, the groups joint
managing director.
Beyond the economic crisis, there are good reasons why Sylvania went on the bleeding path.
Havells had acquired an MNC bigger than itself, but did not have the management
bandwidth to manage such a big company, says Ameet. The challenge was that Havells was
looking for a $60-70 million target, but at a $300-million bid price, the Sylvania deal was far
bigger. It was almost 1.5 times that of Havells in size. The Guptas stretched themselves,
aided by a debt-free balance sheet and good track record, to debt finance the acquisition.
Through the fast-paced bidding process, they had little time to think ahead. It was on January
31, 2007, when they finally got the exclusive bid rights that it began to sink in. There was
Havells first overseas acquisition. The Guptas thought keeping the old Sylvania management
onboard was their safest bet. The bankers and investors preferred this stability.
As per a restructuring plan agreed upon with the bankers, the management embarked on a
two-phased restructuring strategy named: Project Phoenix (January-September 2009) and
Project Prakram (September 2009 to December 2010).
Under Project Phoenix, three plants were shut down. The second phase focused on reducing
fixed costs and trimming workforce at senior levels. While there was some degree of overlap,
in the first phase the focus was more on consolidating the supply chain and scaling down of
operations, while changes in product mix and better price management dominated the latter

part of the turnaround strategy. More importantly, at the end of the exercise the workforce
strength was down by 1,500. The management also renegotiated with the companys lenders
to push the debt reimbursement from 2009 to 2011, giving them much-needed operational
headroom. It was not easy to convince employees that the business could be turned around.
Sylvania has started sourcing a bulk of its products from low-cost markets in Asia. As part of
the outsourcing strategy, Havells entered into a joint venture with a Chinese company to
make lighting products for Sylvania. Observers point out, going forward; this will not only
lower the cost of sourcing for Sylvania but also help it cater to demand in the Chinese market.
The phased restructuring paid off as Havells managed to turn around Sylvania in FY11 with
profit after tax of 2.5 million and has since stayed profitable well into the current fiscal. For
the nine months ended December 2011, profit after tax stood at 9.3 million.
Interestingly, the brush with turning around the global operations of its subsidiary has left an
impact on the parent too. We are now a combination of Indian jugaad with European
systems, points out Anil Gupta. European engineers from Sylvania have been closely
involved in setting up new lighting equipment manufacturing plants in India
Sales in Europe have fallen 4% in the third quarter of FY12, and by a similar margin in Latin
America as well, impacted by adverse currency movement in Brazil. However, the
management in a conference call with analysts attributed the decline in sales in Europe to
exits from non-profitable markets and pointed out that the company was introducing new
products such as power-saving LEDs instead of traditional luminaries and fixtures in
European and other markets to spur sales.
While the management has its task cut out in terms of pushing sales, it also needs to address
leverage concerns. Though Havells has invested around Rs 60 crore by way of equity capital
in its wholly-owned subsidiary, Havells Holdings, towards the final payment of a recourse

loan taken in Sylvania, it still has debt worth 125 million to contend with. Around 40
million, due in April 2012, needs to be refinanced. Whether the company will be able to
lower the rate of interest from the current 8% remains to be seen as banks are increasingly
getting risk-averse in the Euro region. However, Anil Gupta appears confident. Going
forward, Sylvania would be able to pay back its debt from internal accruals, he says.
While the stock market has cheered the turnaround story with the scrip gaining 117% since
2010 to Rs 595 levels, analysts believe current valuations pretty much capture the positives in
store for the company ahead. Despite recovery in operations and profitability, Sylvanias
profitability is expected to remain depressed owing to higher depreciation and interest costs,
mentions Atul Tiwari of Citigroup in a report. Similarly, Amol Rao of Antique Broking feels
that at current levels the stock is fairly valued. Given the overall macroeconomic picture in
Europe, the biggest concern that Ankur Agarwal, analyst with Nomura Equity Research, has
is whether there is room for further improvement in margins in Sylvanias biggest market.
As the meltdown rocked European markets, Sylvania's sales fell, leading to net losses of Euro
16.3 million in 2008/09 and Euro 26.1 million in 2009/10. From Euro 515 million in 2007/08,
revenues dropped to Euro 438.4 million in two years. Trusting Sylvania's management to deal
with the situation turned out to be a mistake on Havells part. Paul Griswold, then CEO of
Havells Sylvania, was hired by the company's previous owners, a group of private equity
investors that included DDJ Capital, Cerberus Capital Management and JP Morgan. He had
turned Sylvania around after it slipped into bankruptcy in 2002 and made it profitable before
Havells bought it, but the magic touch eluded him now. The Havells management sacked
In September 2008, Sylvania's bankers, led by Barclays Capital, hit the panic button as the
company breached its covenants. Put in place by lenders, covenants are a set of financial
ratios that the borrower must maintain. Sylvania's acquisition was funded by debt - a Euro

120-million loan based on operating cash flows and an Euro 80-million loan taken out by a
Havells subsidiary. Havells repaid i80 million by raising money from the sale of a stake to
Warburg Pincus.
Sylvania's poor performance began to affect consolidated numbers, but Havells's growth in
domestic operations made up for Sylvania's losses - for a while, at least. For the Guptas, it
wasn't just their money but also their reputation at stake. Havells's top management drew up
an 18-month restructuring plan. In the first phase, called Phoenix (January to September
2009), the aim was to improve profitability by cutting manpower costs and closing factories.
The second phase, called Prakram (September 2009 to June 2010), focused on further
reducing the headcount, and increasing the sourcing of products from low-cost locations such
as India and China.
Layoffs were a challenge, as severance packages cost money and can hurt sales. "The first
three months were difficult," says Anil. "We had meetings with the top people at Sylvania. In
the beginning, some didn't agree with us, but with more meetings, more people turned
The next challenge was to persuade banks, which were reluctant to fund the restructuring
plan. It didn't help that the Indian electrical market had crashed. "We told the banks we had
mess up, and asked them to give us six months," says Ameet, who is Executive Director at
Havells. The banks agreed only to a two month deferral of repayment of loans, helping
Havells with a Euro 24 million cushion for that period. So Havells poured some Euro 12
million into the restructuring plan.
To begin with, a factory each in Brazil and Costa Rica were closed. Operations at a UK
factory were suspended and shifted to India, where labour accounts for four to five per cent
of the total cost (in Europe, it accounts for 22 per cent). Noncritical staff - accounts, IT,
factory personnel - in European and Latin American operations was also laid off. Some back-

office jobs were shifted to India. The total headcount of 3,800 (at the start of 2009) was
reduced by 41 per cent to 2,233.
Remarkably, the layoffs did not result in a single day's strike. The company strictly followed
labour laws in each country, and ensured that final settlements went off smoothly. "We would
give out payments before the due date," says CFO Gupta. Both phases together led to annual
savings of Euro 34.4 million. The company also spent around Euro 4 million less on the
restructuring than the Euro 36 million anticipated. Besides reducing the headcount, several
areas were targeted including logistics, inventory management, and product pricing. Havells
worked closely with logistics companies and shut down some warehouses, reducing logistics
costs from 14 to 6 per cent of total cost.
To reduce the working capital requirement, the amount of inventory at the company level was
cut from Euro 70-75 million to Euro 40 million without affecting the ability to serve
customers on time. Since 2007, outsourcing from India and China has jumped from 38 to 60
per cent.
Sylvania's products were priced 15 per cent lower than those of rivals Philips, Osram and GE.
This was of little help to Sylvania, which makes high-end products, and also diluted the
brand. "We raised prices in Europe and Latin America by five to eight per cent," says
Sylvania's global operations head Rajiv Goel. He adds: "For some 20-odd years, Sylvania
was owned by financial institutions looking for short-term gains. We told employees that we
are here for the long term."
The results soon began to show. In 2010/11, Sylvania made a net profit of Euro 7 million on
revenues of Euro 449.4 million. Since then, profits have grown steadily: Euro 10.2 million in
2011/12 and Euro 30.5 million in 2012/13, although revenues stayed somewhat flat (Euro
449.4 million in 2011/12 and Euro 439.9 million in 2012/13). The company has seven

factories (it closed one more in the UK in 2009) and a workforce of 2,200 in 50 countries.


FY 2009

FY 2010

FY 2011

FY 2012















#Figures in million
#Source: Havells India Annual Report
Various factors have contributed to the success of Havells, these are identified as
1) International approvals for its products--The company has obtained many
international approvals such as CSA, KEMA, CB, CE, ASTA, SEMKO, SIRIUM
(Malaysia), AENOR (Spain), etc. for its various products. This has facilitated the
company in gaining access to many markets and tapping the potential available.
These certifications assist the company in opening new opportunities and
increasing its reach in the international markets.
2) Strategic Alliances--Company has formed strategic alliances and partnerships

with many leading players operating in the end-to-end solutions in the power
distribution equipment industry. Havells has entered manufacturing alliances with
several leading electrical companies such as Electrium, Geyer AG, DZG, etc.,
which has assisted the company to leverage the technical expertise and
developing quality products in the electrical products segment. Havells has
efficiently leveraged alliances to gain an entry into global markets, developing a
strong product portfolio to capture them.
3) Tax incentives from new plants to expand market share--Havells has
commissioned new plants for electrical consumer durables--fans, CFL, etc. in the
tax-free zone of Uttaranchal and Himachal Pradesh. The production in these zones
would enable the company to expand market share along with margins. The
company can capture a bigger slice of the Rs 1,600 cr electric fan segment from
the unorganized sector on the back of tax incentives which would help it to bridge
the price differential. Besides pricing power, the company hopes to generate
volumes from this segment that is likely to grow at 16% per annum through its
innovative product, which consume 33% less power.
4) Specific plans for future--Havells is planning to acquire a Chinese company
and it has identified a couple of firms for the same. "We are in the process of
acquiring a Chinese lighting company and have identified a couple of potential
firms," Anil Gupta, said. A decision is yet to be taken, however. Havells has also
opened a representative office in Shanghai in a bid to penetrate into the fast
growing Chinese electrical equipment market.
5) Understanding need of the hour--Havells understand the need of the hour. For
e.g. in October 2007, it invited global private equity firm Warburg Pincus to
invest $110 million. Havells will issue fresh shares and warrants to the PE firm,

representing about 11.2% of the fully diluted share capital of the company. The
PE investment will be utilised to partly retire the debt raised during the Sylvania
acquisition. The equity placement will provide the company with additional debtraising capacity.
6) Diversification--Havells is not shy of investing in unrelated field. In November
2007, the company acquired 70% stake in a 140-bed super specialty hospital Central Hospital and Research Centre, Faridabad. The investments in the hospital
segment are routed through its newly floated company QRG Healthcare."The
acquisition marks the beginning of our entry into the healthcare segment. We
have spent over Rs 20 cr for the acquisition and are investment an equal amount
in expanding the existing facilities in the hospital. In the next phase, we are likely
to go for more such facilities", Qimat Rai Gupta said .Havells Group is the latest
among established industrial houses diversifying into the healthcare segment.
Paras Healthcare and Apollo Tyres promoted Artemis Health Sciences are among
the new healthcare service providers in the national capital region (NCR).
7) No major clash in opinion-- Havells usually do not face much of difference in
opinion as said by Mr. Anil Gupta that there isn't much of the friction that the
young generation typically brings to an established family business. Thankfully,
unlike people of his generation he is (Qimat Rai Gupta) still very abreast of what's
happening in the world. And he attributes this partly to his own temperament as
well as the willingness of his father to adapt to new thinking.
8) Problem Analysis and Decision Making --Havells India acquired Sylvania
Lighting Inc. This acquisition was a good strategic acquisition for Havells India.
This made sense because of the fact that Havells was looking to expand its
market. Havells prior to the acquisition only had entrance into the Southern and

Eastern markets. After the acquisition of Sylvania they will have acquired an
international business division and certifications. This includes over 45 different
countries including Europe, Middle East and Africa.
Restructuring activity proved effective immediately as Sylvania turned profitable reporting a
net profit of EUR70 million in FY11 against the net loss of EUR69.0 million during FY10.
Sylvania also reduced the geographical risk by diversifying into new markets by shifting the
focus from Europe to Latin American countries and reported a shift of 400bps from 35%
revenue contribution of Latin America during Q2-FY12 to 39% during Q2-FY13. Sylvania
has also launched various new products to sustain profitability; however, Sylvania is still
facing macroeconomic head-winds and competition from global giants.
This restructuring again required an extra amount of debt and HIL refinanced its outstanding
debt of EUR102 million, which was payable in two tranches by the end of April 2012 and
April 2013. Under the new proposal, EUR40 million has been guaranteed by Havells India
repayable in one year i.e. up to April 2013 while the balance EUR77.5 million is on the book
of Sylvania and will be repaid over the next four years (i.e. up to May 2016).
Going forward we expect Latin American and other markets to post strong growth on the
back of these restructuring activities. We expect Latin American markets to grow at 10%
CAGR and other Asian markets to grow at 15% CAGR over FY13 over FY13-15E. However
European business is likely to remain under pressure as European markets are still reeling
under the slowdown fueled by the European Sovereign Debt Crisis. We have estimated a flat
growth for the European business for the next two years on the back of flat GDP projections
for most of the European markets.

Finally it can be said that Havells is one of the finest examples of entrepreneurship and
turnaround business. Havells has simply followed the four golden principles of family
business management: Form a firm foundation, Continuous communication among members,
Follow a proper process in dealing with business and family and Go by merit in introducing
next generation. To identify merit, the business may require that members first workout side
and prove their worth for Havells. They may be later introduced into Havells.
Now, Havells is a global Family business. Some of these businesses have survived the test of
time, with autocratic leadership style of the first entrepreneur. It is not a case with Havells; its
real growth came after the introduction of the generation next. Other can also follow Havells
and be like them, otherwise Bhagirath place, from where Guptas started, still see traders
opening and closing the same shops for the last fifty years or more.