BTTV Exclusive | Why Godrej Capital will be a very good candidate for public listing, explains Pirojsha Godrej

Pirojsha Godrej BTTV Exclusive Interview: Godrej Industries Group recently announced a new purpose and brand identity as it aligns its identity, strategy, and ambition for its next phase of growth. The Group says it intends to expand from three (Consumer Products, Properties, and Agrovet) to five publicly listed platforms. On the occasion, Pirojsha Godrej, Chairperson Designate, Godrej Industries Group, in an exclusive conversation with Business Today’s Group Editor Siddharth Zarabi, explained why Godrej’s financial services business will be a very good candidate to be a publicly listed player.

“…I think you know one that we’re very passionate about is our financial services business. That business is just 5 years old; it’s the youngest business in our group. In that 5 years, it has already gotten to over a 25,000 cr AUM and has scaled very well,” Pirojsha Godrej said.

‘Rs 100,000 cr AUM over next 5 years’

“We’re very confident about the team that’s in place in that business, and the aspiration there is to take it from a 25,000 cr, roughly, to a 100,000 cr AUM over  next 5 years. At that point, we think that business will be a very good candidate to be a publicly listed player, given the scale of the financial services business as an industry and the opportunity the Godrej brand provides. If we’re able to execute well, I think over a period of time this can be one of, if not our largest, business,” Pirojsha added.

Intent behind listing

When asked about the intent (raising capital or unlocking value) behind listing at least two more Godrej Group companies, Pirojsha said, “I think the intent will be to make sure the businesses can raise the capital they need for their growth on an ongoing basis in a sustainable manner. So the group, at the group level, we don’t want to be funding businesses indefinitely. So, once we’ve created a certain amount of value, and businesses have gotten to a certain stage, we think it’s both important to unlock some of that value and then think about new ventures at the group level, but let those businesses then grow on their own steam.”  

Listing time frame

Talking about the generalized time frame for listing those two companies of Godrej Group, Pirojsha said, “I think, so this 5-year time frame is the time frame we’re looking at for that; within that, exactly when will depend on, you know, how markets perform, how the individual businesses grow.”

‘20% CAGR over the past five years…’ – Godrej Industries 

The Group in an official statement also said that it has demonstrated a strong growth track record, compounding both sales and net profits at over 20% CAGR over the past five years. It has outlined clear ambitions for the next phase of growth, including >15% annual sales growth and >20% EPS growth as a Group. It also expects each business to deliver >18% return on equity at steady state.

WATCH FULL INTERVIEW here: BTTV Exclusive | Pirojsha Godrej

The Group said it intends to expand from three (Consumer Products, Properties, and Agrovet) to five publicly listed platforms. These actions are expected to result in a combined market capitalization of Rs 5,00,000 crore over the next five years.