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The story of Trident's success
Sangeeta Singh in New Delhi | September 10, 2005
Sitting at one of the tables of the self-service canteen of Abhishek Industries in Ludhiana's Kitchlu Nagar, Rajinder Gupta doesn't stand out. He blends into the crowd as he gets up for a second helping of rice or some water.
But RG, as he is popularly addressed, is the founder of the Rs 1,500 crore Trident group of which Abhishek Industries, with sales of Rs 800 crore, is the flagship. He hasn't acquired the airs or the accent some first-generation rags-to-riches entrepreneurs put on, especially those who deal mostly with foreign clients.
He is absolutely at ease while talking about his modest beginning. The family, which was once in the business of grain trading, took its first leap in entrepreneurship in 1985 by getting into the business of chemicals and fertilisers with an investment of Rs 6.5 crore.
In the 1990s, it diversified into yarn, paper and terry towels. With an annual compounded growth of 35 per cent in sales over the last 10 years, the Trident group has also adopted quite a few modern and eco-friendly practices.
For instance, for its paper business it uses only agro residue so there is no felling of trees - and it co-generates power as a by-product, which, along with steam, is diverted to the terry towel plant. This helps the group save substantial money that is incurred on power besides being self-reliant.
"Today, we are one of the lowest-cost producers of paper in the mid-segment. Having established ourselves in this segment, we are increasingly looking at geting into the value-added segment," says Gupta. The paper and chemicals division also produce sulphuric acid and co-generates soda recovery.
However, what has won him laurels are his initiatives in the terry towel business. His clients include Walmart, Luxury Linens, JC Penney, Chris Madden and TJ Maxx. Abhishek Industries won the WalMart International Supplier of the Year award twice-in 2001 and 2003-and Gupta was shortlisted amongst the top 20 India Inc Icons Ernst & Young Entrepreneur of the Year Award, last year.
To meet growing international demand, Abhishek Industries is expanding its capacity in the towels business to over three times, taking it to 29,000 tonne per annum. "The Trident group is one of the top five producers of terry towels in the world," says Gupta.
And along with terry towels the company has also started exporting surplus yarn (after captive consumption in terry towel). Starting with 17,000 spindles 12 years ago, Abhishek has added over 60,000 spindles. Textile contributes 75 per cent in the group's total businss, with terry towels contributing the maximum as it is a value-added item.
However, unlike other entrepreners in that area, Gupta has not moved out of Punjab. Most have been lured by the excise holiday and power subsidies in neighbouring Himachal Pradesh. His rivals, however, say Gupta has good
reasons to be in Punjab as he is politically connected.
Though Gupta denies his political connections, he accepts that the state government (whatever the ruling party) has supported Trident's growth plans from time to time.
"Trident has all its plants, raw material sources and so on within Punjab, unlike some of our rivals, who have expanded their activities to the more attractive states of Haryana or Himachal Pradesh. I guess that is paying off," says Gupta.
With the second phase of expansion in terry towels to be completed this fiscal and expansion in the paper business to be done by 2007-08, Gupta is certainly moving ahead.