MUMBAI WEDNESDAY JANUARY 11997

HOW I MADE MY FIRST MILLIONPERSONALI~-··" ••••

BUSINESS STANDARD

FINANCE 'Companies should be profitable'Asgar Patel, founder of Patel group of companies,built up his empire literally from the scratch.

STARTING OUTIn 1957, after ten years of education in England, I

returned to India at the age of17. Ifelt like an alien. The cul-tural shock was so severe that I wanted to go back, but myparents refused to send me back. Those days, my fatherwas making and selling various consumer goods likeshoes, caps, umbrellas, raincoats and gumboots. But theproducts had no brand name and the business didn't lookexciting. I opted out of the family store and joined FairdealMotors as a stenographer. My knowledge ofshorthand andtyping helped me. Soon Ibecame a salesman.

THELUCKYBREAKWhile I was working there, in 1959, a friend offered me

his truck. I decided to accept the offer; but didn't have anymoney. I was 19and was broke. Suddenly, I remembered afewfinanciers Ihad met during my stint at Fairdeal Motors.But I had no one to stand guarantee for me, and there was

1 no collateral either. Anyway, I approached one financier,: and got money at the rate of 38 per cent. I took the truck on1 hire purchase.

To get a feel of the business, I took a few trips. I started, with Glaxo first. The man at the helm in Glaxo was a, Scotsman. My education in Scotland helped us to strike a

rapport He gave me my first load. I drove it betweenBombay and Delhi myself. Once I reached Delhi, I evenunloaded six tonnes of load myself to save the unloadingcharge of Rs 8. I was then introduced to Colgate'sChairman, VK Koddikal. That was the beginning. Little bylittle Ibuilt Patel Roadways.

MAKE OR BREAKNow I needed a mascot for my company. Since I was

weak in local language, I wanted a symbol to do the job for

Asgar Patel, chairman, House ofPatels

me. I picked the Kangaroo which moves at the speed of 60miles per hour with the child in its pouch, safely. Even ifthe Kangaroo dies the joey remains safe. What I wanted tocommunicate to the Indian public was that their cargo wassafe with us. It was a symbol of trust. Of course, it meantmore to me. The kangaroo can only move forward, it can'tmove backwards. Not many Indians know this. For me,too, there was no turning back. My father didn't approveof the line I have chosen. He made it clear that he won'tsupport me in my venture. There was some stigmaattached to the truck industry. I didn't mind being a truckdriver. In fact, I was a big hit on the national highway. Icould not speak Hindi and I was an anomaly. Other dri-vers, however, were helpful, and I built up my contactsquickly.

TURNING POINTI also negotiated quite a few loans. In those days it was

difficult to secure finance because all the banks were pri-

vate. However, unlike other truck drivers I was able to pre-sent my papers properly. Drivers used to approach me forvehicles and I obliged them on condition that they will car-ry my loads. I was doing in 1961 what leasing companiesare doing these days. I had a fleet ofvehicles without actual-lyowning them.

BREAKTHROUGHWe opened offices in Bombay, Delhi and Indore. From

trucking I also moved into exporting steel and buildingmaterial to Dubai during the construction boom in early1970s.We also became consultants to a finance outfit calledWall Street Finance. It belonged to my nephew. Later myson Riyazjoined the firm and bought it out It soon expand-ed with new branches in Singapore, Hong Kong, Sydneyand London.

In 1992,Riyaz also applied for an off shore bank in NewZealand and set up Wall Street Banking Corporation.Around this time, the Reserve Bank of India cleared my 12-year-old application to be a forex dealer in India. Wall StreetFinance is now a category I merchant banker, offering avariety offinancial services.

From road we progressed to air; we started PatelAirways. Five years ago we also started Patel On-BoardCouriers. In 1993,we launched Patel Airfreight and PatelTours and Travels, a subsidiary. Today, the network ofPatel Roadways covers every part of India, over 1,100 sta-tions and over 1,000trucks, carrying Rs 5,000 crore worthcargo annually. Freight earnings were Rs 96.30 crore in1995-96. The turnover ofWall Street Finance was Rs 17.39crore. Patel On-Board Couriers also recorded sales of Rs49.17crore.

As for the future, we have plans to set up Wall Street IBank in India. Abank in Mauritius is also on cards. We alsowant to set up infrastructure at the airports and large ware-houses for storing perishable cargo.

--MadhuT

6 BOMBAY TIMES, THE TIMES OF INDIA Mumbai Ine -' ---Rajan Chaughule drastically and the same

route takes 3 days."From then onwards there

was no looking back andhis "Patel Roadways"slowly grew to a couple ofmore trucks and now theyown 600 trucks and have2,000 other trucks undercontract. Their transportempire now has 600branches and 1,100 dock-ing stations all over thecountry. Even though it isranked as number one inthe transport industry, Patelfaced a lot of difficulties toget people to work for himinitially. "To overcome thisI started Patel Institute ofTransport, advertised ex-tensively and guaranteed

OUR decadesago, in the earlyyears of Independence,Asgar S Patel,

son of a wealthy business-man, was sent to Glasgow,Scotland, for his education.vhen he was just 7 yearsold. He later went on to fin-Ish his A level education inBrighton, London. Duringthis period, Asgar Patel re-fused to take any moneyfrom his dad and earnedhis way through. "I used torun the school Tuck shopwhen I was 9 years old," hethinks back smiling, "then Ieven took up a number ofagencies including that ofCadbury's to maintain theexpenses I incurred thereto stay fashionable, I usedto wear the best of clothes."In..1956 after completinghis A levels, 16-year-oldAsgar Patel came down toIndia for the first time sincehe had moved to London."Since I spent my formativeyears of my life in the UK, Ihad become an absoluteEnglish man, right from mymannerisms, dressing andeven my accent," he re-calls, "I COUldn't evenspeak in Hindi or mymother tongue, this hurtme quite a lot because Icouldn't even communi-cate with my mother." Hesaw no sense in going backto London and decided tostay back and learn the In-dian culture. "At my father'sshop, Patel BrothersTopiwallah, Pydhonie, wesold caps, shoes, raincoatsetc." he reminisces, "thiswas not very exciting for an18-year-old like me, so Itook up typing and shorthand classes. He was thefastest in his class and took ~ojng miles to achieve: The dynamic Patels

. great pride in his speed. ''There was Nehru era, with the birth ofonly one person in the class who industrialisation in India taking place.could compete with my speed," he Patel was advised to look into thesays smiling, "and now I am married truck business by one of his associ-to that person." ates. "My father was very much

He took up a job as a clerk at a against this idea, it was not a veryshop called Fairdeal Motors "There respectable business then and heI worked as a stenographer for a felt that I would be wasting my Brit-very nice gentleman Anand Swadi, ish education," hewho later on taught me how to write reveals, I lookedletters, answer phone calls and even for clients and ap-got into sales eventually, ultimately proached the di-handing me the task of money col- rectors of many foreign companieslection,' Patel recalls gratefully. His like Colgate, Polychem, Ponds coldjob was to collect payments from cream, Glaxo and Dumex. The di-customers and even repossess the rectors of these companies were allcar if necessary. "All this covers my expatriates. With his British manner-work today," he points out. isms and personality he managed

In the beginning of 1960, in the to convince them to hire his services.

ONT-

Asgar Patel of Pia truck on everycountry's map. J

~~~~~~--......5..;t~""-I he wheeled in a"My first client was Glaxo, the direc-tor was a Scotsman and we got onlike a house on fire," he looks back,"I got the contract, but the only glitchwas that I didn't have a bank ac-count, so for the first time, Glaxomade an exception and paid me bycash." Moreover to buy his first truck,

Patel 'lad taken aloan in 1961 at asteep rate of 28per cent interest.

He even drove his own truck not onlyto save money but also to learnabout the business. "I used to do theMumbai-Delhi route in flat 36hours,"he says proudly, "now unfor-

. tunately with the sharp increase invehicles, the road space has shrunk

jobs to all the individuals who com-pleted the course," explains Patel.With a batch of 40 students complet-ing the course every year where hehimself lectured, Patel provided theentire industry with a more compe-tent breed of people who could helpmanage the transport industry ... Allthe different transport companiesused to come to me. They wantedto absorb my students," reminiscesPatel.In 1978, Patel started his construc-

tion firm named after his daughter,"Natasha Constructions", and hisfirst project was the Natasha build-ing in Bandra which harbours theheas office of "the house of Patels" .Then he went on to constructing

City Lights

6 BOMBAY TIMES, THE TIMES OF INDIA Mumbai Ine -' ---Rajan Chaughule drastically and the same

route takes 3 days."From then onwards there

was no looking back andhis "Patel Roadways"slowly grew to a couple ofmore trucks and now theyown 600 trucks and have2,000 other trucks undercontract. Their transportempire now has 600branches and 1,100 dock-ing stations all over thecountry. Even though it isranked as number one inthe transport industry, Patelfaced a lot of difficulties toget people to work for himinitially. "To overcome thisI started Patel Institute ofTransport, advertised ex-tensively and guaranteed

OUR decadesago, in the earlyyears of Independence,Asgar S Patel,

son of a wealthy business-man, was sent to Glasgow,Scotland, for his education.vhen he was just 7 yearsold. He later went on to fin-Ish his A level education inBrighton, London. Duringthis period, Asgar Patel re-fused to take any moneyfrom his dad and earnedhis way through. "I used torun the school Tuck shopwhen I was 9 years old," hethinks back smiling, "then Ieven took up a number ofagencies including that ofCadbury's to maintain theexpenses I incurred thereto stay fashionable, I usedto wear the best of clothes."In..1956 after completinghis A levels, 16-year-oldAsgar Patel came down toIndia for the first time sincehe had moved to London."Since I spent my formativeyears of my life in the UK, Ihad become an absoluteEnglish man, right from mymannerisms, dressing andeven my accent," he re-calls, "I COUldn't evenspeak in Hindi or mymother tongue, this hurtme quite a lot because Icouldn't even communi-cate with my mother." Hesaw no sense in going backto London and decided tostay back and learn the In-dian culture. "At my father'sshop, Patel BrothersTopiwallah, Pydhonie, wesold caps, shoes, raincoatsetc." he reminisces, "thiswas not very exciting for an18-year-old like me, so Itook up typing and shorthand classes. He was thefastest in his class and took ~ojng miles to achieve: The dynamic Patels

. great pride in his speed. ''There was Nehru era, with the birth ofonly one person in the class who industrialisation in India taking place.could compete with my speed," he Patel was advised to look into thesays smiling, "and now I am married truck business by one of his associ-to that person." ates. "My father was very much

He took up a job as a clerk at a against this idea, it was not a veryshop called Fairdeal Motors "There respectable business then and heI worked as a stenographer for a felt that I would be wasting my Brit-very nice gentleman Anand Swadi, ish education," hewho later on taught me how to write reveals, I lookedletters, answer phone calls and even for clients and ap-got into sales eventually, ultimately proached the di-handing me the task of money col- rectors of many foreign companieslection,' Patel recalls gratefully. His like Colgate, Polychem, Ponds coldjob was to collect payments from cream, Glaxo and Dumex. The di-customers and even repossess the rectors of these companies were allcar if necessary. "All this covers my expatriates. With his British manner-work today," he points out. isms and personality he managed

In the beginning of 1960, in the to convince them to hire his services.

ONT-

Asgar Patel of Pia truck on everycountry's map. J

~~~~~~--......5..;t~""-I he wheeled in a"My first client was Glaxo, the direc-tor was a Scotsman and we got onlike a house on fire," he looks back,"I got the contract, but the only glitchwas that I didn't have a bank ac-count, so for the first time, Glaxomade an exception and paid me bycash." Moreover to buy his first truck,

Patel 'lad taken aloan in 1961 at asteep rate of 28per cent interest.

He even drove his own truck not onlyto save money but also to learnabout the business. "I used to do theMumbai-Delhi route in flat 36hours,"he says proudly, "now unfor-

. tunately with the sharp increase invehicles, the road space has shrunk

jobs to all the individuals who com-pleted the course," explains Patel.With a batch of 40 students complet-ing the course every year where hehimself lectured, Patel provided theentire industry with a more compe-tent breed of people who could helpmanage the transport industry ... Allthe different transport companiesused to come to me. They wantedto absorb my students," reminiscesPatel.In 1978, Patel started his construc-

tion firm named after his daughter,"Natasha Constructions", and hisfirst project was the Natasha build-ing in Bandra which harbours theheas office of "the house of Patels" .Then he went on to constructing

City Lights

TUESDAY 22 JULY 1997

IItI other buildings primarily in the!III' Bandra vicinity. But now Natasha

~

': Constructions is experiencing aj"" major slump. "This is all thanks to

the mafia element, government ha-\.. rassment in the form of IT raids etc,"I'q he admits. Now" construction busi-

ness has a very bad reputation

~

' thanks to a few builders."In 1972, his elder son Riaz started

'Wall Street Finance' in Dubai whichdealt in forex and supplied curren-cies to banks like Credit Suisse,Chase, Nat West, Swiss BankingCorporation and even the Arab Fi-nance Services. He later spread hiswings to Hong Kong and Londonand brought "Wall Street Finance" toIndia. "It is the biggest in Forex busi-ness in India - second only to Tho-mas Cook", he announces proudly.

In 1988, Asgar Patel started Patel

E

~CCESSlatel Roadways has)1 road of the~mish Mody on how!2

fortunej On-Board couriers, then Patel Travel

and Tours was born," he says prag-matically. Twenty-five-year old Arif,

a Patel's younger son joined the com-- pany eight years ago. "I joined up

my father's firm in 1989-'90 after fin-ishing my high school in Connecti-cut at a private school. RosemaryHall," thinks back the young groupdirector. Though he had enjoyed hisschool life abroad, he realised thaIhis business and home were inMumbai, so he opted to come back.The 57-year-old protagonist of this

success story abides by only twobasic philosophies. Firstly, makeprofits and create surpluses. Andthis will help them scale the heights'of success.

MUMBAI WEDNESDAY JANUARY 11997

HOW I MADE MY FIRST MILLION

'Companies should be profitable'Asgar Patel, founder of Patel group of companies,built up his empire literally from the scratch.

STARTING OUTIn 1957, after ten years of education in England, I

returned to India at the age of 17.I felt like an alien. The cul-tural shock was so severe that I wanted to go back, but myparents refused to send me back. Those days, my fatherwas making and selling various consumer goods likeshoes, caps, umbrellas, raincoats and gumboots. But theproducts had no brand name and the business didn't lookexciting. I opted out of the family store and joined FairdealMotors as a stenographer. My knowledge ofshorthand andtyping helped me. Soon Ibecame a salesman.

THELUCKYBREAKWhile I was working there, in 1959, a friend offered me

his truck. I decided to accept the offer; but didn't have anymoney. I was 19and was broke. Suddenly, I remembered afewfinanciers I had met during my stint at Fairdeal Motors.

, But I had no one to stand guarantee for me, and there wasI no collateral either. Anyway, I approached one financier,, and got money at the rate of 38 per cent. I took the truck on

hire purchase.To get a feel of the business, I took a few trips. I started

with Glaxo first. The man at the helm in Glaxo was a, Scotsman. My education in Scotland helped us to strike a

rapport He gave me my first load. I drove it betweenBombay and Delhi myself. Once I reached Delhi, I evenunloaded six tonnes of load myself to save the unloadingcharge of Rs 8. I was then introduced to Colgate'sChairman, VK Koddikal. That was the beginning. little bylittle Ibuilt Patel Roadways.

MAKEORBREAKNow I needed a mascot for my company. Since I was

weak in local language, I wanted a symbol to do the job for

Asgar Patel, chairman, House ofPatels

me. I picked the Kangaroo which moves at the speed of 60miles per hour with the child in its pouch, safely. Even ifthe Kangaroo dies the joey remains safe. What I wanted tocommunicate to the Indian public was that their cargo wassafe with us. It was a symbol of trust. Of course, it meantmore to me. The kangaroo can only move forward, it can'tmove backwards. Not many Indians know this. For me,too, there was no turning back. My father didn't approveof the line I have chosen. He made it clear that he won'tsupport me in my venture. There was some stigmaattached to the truck industry. I didn't mind being a truckdriver. In fact, I was a big hit on the national highway. Icould not speak Hindi and I was an anomaly. Other dri-vers, however, were helpful, and I built up my contactsquickly.

TURNING POINTI also negotiated quite a few loans. In those days it was

difficult to secure finance because all the banks were pri-

BUSINESS STANDARD

vate. However, unlike other truck drivers I was able to pre-sent my papers properly. Drivers used to approach me forvehicles and I obliged them on condition that they will car-ry my loads. I was doing in 1961 what leasing companiesare doing these days. I had a fleet ofvehicles without actual-ly owning them.

BREAKTHROUGHWe opened offices in Bombay, Delhi and Indore. From

trucking I also moved into exporting steel and buildingmaterial to Dubai during the construction boom in early1970s.We also became consultants to a finance outfit calledWall Street Finance. It belonged to my nephew. Later myson Riyazjoined the firm and bought it out. It soon expand-ed with new branches in Singapore, Hong Kong, Sydneyand London.

In 1992,Riyazalso applied for an off shore bank in NewZealand and set up Wall Street Banking Corporation.Around this time, the Reserve Bank of India cleared my 12-year-old application to be a forex dealer in India. Wall StreetFinance is now a category I merchant banker, offering avariety offinancial services.

From road we progressed to air; we started PatelAirways. Five years ago we also started Patel On-BoardCouriers. In 1993,we launched Patel Airfreight and PatelTours and Travels, a subsidiary. Today, the network ofPatel Roadways covers every part of India, over 1,100 sta-tions and over 1,000trucks, carrying Rs 5,000 crore worthcargo annually. Freight earnings were Rs 96.30 crore in1995-96.The turnover ofWall Street Finance was Rs 17.39crore. Patel On-Board Couriers also recorded sales of Rs49.17crore.

As for the future, we have plans to set up Wall StreetBank in India. Abank in Mauritius is also on cards. We alsowant to set up infrastructure at the airports and large ware-houses for storing perishable cargo.

--MadhuT