K. Ravi inherited more than an infant cement business from his father. His real inheritance was a cherished dream—to build a business, whatever the odds. When he took over Nagarjuna Cements, he gave up his own dream of an engineering career in the Indian Air Force. Twenty years later, Ravi has nurtured his father’s dreams to build a pioneer cement and building materials company with 10 manufacturing units spread all over India. Here, he takes us through the dramatic journey of the company’s early years, and the twists and turns on its path to becoming a building giant.

I hail from an agricultural family in a village in coastal Andhra Pradesh. My family’s journey of entrepreneurship began in not very happy circumstances. My father was forced out of agriculture by a three-year long drought in the mid 1960s. The drought was symbolic of my family’s struggle in those years. After leaving our farms, my father struggled for a long time as a sales representative in a pharma company. He also went on to start his own pharma business but that was unprofitable too. His first break came in the early 1970s, when he stumbled on the chemicals business. In fact, we continue to run that chemical manufacturing unit till today. As the eldest of four sons, I grew up seeing my father’s unyielding determination and hard work. His experiences deeply influenced me.

Although the chemicals business was profitable, my father never stopped looking for better opportunities. In 1979, he founded Nagarjuna Cement Limited (NCL). My father’s entry into the cement business was a result of his entrepreneurial instincts. He identified the opportunities and needs of the market well because there was a great demand for quality cement at that time, but only a handful of suppliers. He backed up identifying the opportunity by studying the market really well before taking any further steps. On its part, the government was encouraging infrastructure development, and industries like cement were therefore getting a fillip.

Looking back, I was almost pushed into the company after my Bachelor’s degree in Electrical Engineering from Andhra University. My dream was to join the Indian Air Force. But, my father needed technical expertise. It was becoming hard for NCL to meet functional demands given our lack of technical background. So, I was sent to the Delhi Cement Research Institute to learn cement manufacturing. Soon, I was hooked for good. Of course, my Air Force career could never take off but I’m thankful for the serendipitous turn of events. We began commercial production in 1984 with a capacity of 66,000 tonnes every year. Our first cement plant was located near the Mattapally limestone deposits in Nalgonda districts. Mattapally was a remote location, and logistics were a huge challenge for us. But the quality of limestone was unbeatable, and we didn’t want to compromise on that core requirement.

Business is essentially about two things only—customers served and employees who make that possible.” –K. Ravi

In fact, demand was so brisk that in 1989 we had to enhance our capacity to 1.98 lakh tonnes per annum. But, as our orders increased, we found it nearly impossible to meet our delivery deadlines because of under-developed logistics. Truck services to and from Mattapally were unreliable. We decided we would buy our own fleet of trucks. It was a risky financial decision for us. But, it helped us tremendously in servicing the demand.

Business was brisk. Soon, we were ready to expand. By the beginning of 1990, we had a Rs 22-crore turnover. With economic reforms in 1991, the construction industry in India showed great promise. We forayed further into building materials beyond cement. In 1992, we produced a bone-china ceramic material using natural gas for the first time in the country. The following year we opened a pre-fab facility in Himachal Pradesh that produced wood cement particle boards using West German technology to replace wooden panels.

K. Ravi's business philosophy is rooted in his father's advice to him, "If you don't want to stop growing, stay hungry for more."

This string of expansions took up huge amounts of investment. By the early 1990s, NCL was facing severe financial difficulties. We almost came close to selling the entire cement division. But to my pleasant surprise and great relief, our dealers came to our rescue. They offered to defer interest payments on their fixed deposits with us for a few months. And, our workers volunteered to give up some of their benefits. Personally, that was overwhelming. This period—from 1992 to 1995—reinforced my conviction that business was essentially about two things only—customers served and employees who make that possible.

In fact, business should be run by gut. Following your gut might seem irrational at times but it can prove to be very insightful, in retrospect. For example, around 1995, there was a lot of talk about renewable energy and the government opened up hydel power generation to the private sector. It was a radical digression from our core business. But the electrical engineer in me was excited with the possibilities. My father and I had a tiff over this issue. Yet, I was confident the possibilities were bright. So, I undertook extensive feasibility research and found that hydel power plants were quite self-sustainable, and need little maintenance after the initial investment. We built a 16 MW plant near the Tungabhadra Dam. It was the right time for us to do this as the government was offering financing options. This plant turned out to be a great idea, and became a captive power source for us during times of crises.

Over the last decade or so, we have enjoyed the fruits of our innovation and good work. Innovation has been the key reason for us in being successful. For example, we pioneered in the field of building materials such as laminated cement bonded particles which have given us a considerable edge over competition. In the building industry, once you establish quality and reputation, you have won the loyalty of the customer. Unlike consumer retail, the market here is less fickle and reluctant to changing brands if they are satisfied with one.

My father used to tell me that if you don’t want to stop growing, stay hungry for more. This has always been the guiding principle of my vision for the company. After crossing a turnover of Rs 500 crore in 2010, we opened two RMC plants in Hyderabad and Vizag. It contributed significantly in taking the turnover to Rs 750 crore in 2011. There’s huge potential for building infrastructure in India today. So we are constantly expanding, and are currently exploring joint venture proposals from the Middle East and other markets.