Good food, friends and socializing were the thoughts on Rajat’s mind when he went to attend the wedding reception of a family acquaintance. For this to be his moment of truth was the last thing he expected. After filling his plate, he approached a table where people were chatting during dinner.
âYou know, Dr. Agarwal’s son did some business that ruined the family. They had to sell their house in Tilak Nagar and move to a rented flat in Jawahar Nagar,â said one of the guests, sparking curiosity from others sharing the dinner table. It was enough for Rajat Agarwal, the founder of Gravita India, to return home deserting the plate, hiding tears in his heart.
Today, Gravita India is on track to achieve an expected revenue of Rs 2,100 crore and profit of around Rs 140 crore for the current financial year. It manages 13 reclining factories, operates in 17 countries and employs more than 3,500 people. âGravita India is the true multinational of Jaipur. But the beginning was nothing short of tumultuous, not because of my shortcomings but because of the government’s political reversals. I would give the Indian government credit for showing me the big picture,â Rajat says with a laugh.
A mechanical engineer from MNIT, Rajat knew early on that entrepreneurship was his true calling. A hotelier in college, Rajat visited his parents in Jhalawar. His father was the chief medical officer there. He tried to persuade his father to buy a large farmland for farming.
âMy father taped the idea on the spot. I was then in second year, but I decided to create a company, and not to do a straitjacket job that guarantees social security but leaves no room for your dynamism to flourish. At home, I pushed my parents hard to donate Rs 1 lakh to buy land in my mother’s name. Later, my father agreed to the plan. I wanted to have a new pair of wings,â recalls Rajat.
On Diggi Malpura Road, he bought 20 acres of land and immediately started growing vegetables. He would go to the Pusha Institute of Agriculture Research in Delhi to buy seeds and learn the scientific methods of cultivation. âIn the first year, I sold vegetables worth Rs 1.35 lakh and Rs 1.85 lakh the following year. The success prompted me to start a dairy farm with 10 Holliston cows initially,â says Rajat.
But the path of progress would soon change. Just before the final exams, he saw an advertisement from L&T, asking for a dealer. He applied and was shortlisted. The position required an engineering degree with an MBA, which he did not have. During the final interview, Rajat told the interviewers âgo see my farmâ. He was selected. Rajat delivered far more than L&T expected.
âI made money, but the virus of creating a manufacturing unit bit me. I left L&T and wanted to start a business related to environmental conservation. The idea of ââtilting lubricating oil, tires, car batteries and industrial paint arose. Instead of jumping in headlong, I had to understand the market first. So I imported a batch of each product and sold it to recyclers,â says Rajat.
In the 1990s, India imported more than 60% of its lead needs. He thought there was great scope in battery recycling. It was a difficult decision to close the farm and sell the three dozen cows to create Gravita India. In the early years, lead recycling generated decent profits. But soon he would encounter an existential moment. In 1996, the Basel Convention established a number of prohibitions on the movement of hazardous waste. Instead of banning and regulating the use, the Indian government has banned their importation in its entirety. Rajat’s lead unit was out of breath.
“It shocked me. I had to close a legitimate business and lay off over 100 employees. I am very passionate about business. After a few years, I ventured into recycling liquid lead which was allowed to be imported. The moment I started the unit, there was another blow.The Center again reduced import duties on lead chemicals from 35% to 5%.This made imports much cheaper. I had to close that unit again,â Rajat recalls.
The closure of the second unit left Rajat bankrupt. The bank forced him to sell his family home and factory to pay. The house was sold but there were no buyers for the factory. Not knowing what to do, Rajat went to Singapore to work for a company specializing in scrapes. After office hours, he was looking for opportunities and partners to start a business outside India.
“I had the opportunity to start a battery-powered reclining unit in Sri Lanka. As I knew the business, an associate joined us. Lead recycling worked well at first, but we soon realized that working capital was hard to come by. The business ran into bad weather. In times of crisis, I get granular clarity. I have approached strategic investors in India if they can come in as partners. They were very impressed to see the facility and got on board. With sufficient working capital, the unit became a money maker,â says Rajat.
With the Sri Lankan unit doing well, Rajat expanded the recycling business to Ethiopia in 2005. Units in Madagascar, Namibia and Ghana subsequently appeared. He wanted to return to India but first had to have his bankruptcy status revoked. “The bank was kind enough to waive the criminal interest as they knew that the failure of the unit was due to government policies. It was a great emotional return. I set up a unit in Jaipur and then bought two units in J&K, a few in Gujarat and Andhra Pradesh,â says Rajat.
In a bid to fuel growth, Gravita hit the capital market in 2010 raising Rs 45 crore. The number has been subscribed 43 times. âIf you have the fire in your belly and the passion, nothing can stop success. Of course, during the topsy-turvy journey, my committed team at Gravita played a key role. Also, the parents stood behind me like a rock. I received exemplary strength from my wife,â Rajat recalls.
After two successful ventures including agriculture, Gravita India promoter is twice starting lead reclining units but had to shut them down after conflicting center policies