Go Air to grow very aggressively from 2015: Jeh Wadia

With business in his blood, Jeh Wadia from the illustrious Wadia Group, has dabbled in a multitude of businesses like music and IT besides learning the ropes in the family business.

While the group’s companies are present in diverse industries like food, textiles and tea, he has spearheaded their foray into the aviation and realty industry. At present, he is actively involved in Go Air, the low-cost airline he started, Bombay Dyeing, the family’s century-old textile company, and Bombay Realty, the Wadia Group’s entry into the real estate industry. In conversation with CNBC-TV18, Jeh Wadia talks of his vision of taking his business forward to the next stage of evolution. Below is the verbatim transcript of the interview Q: Some say that you are son of the owner of a huge conglomerate. Entry into the business world must be a cakewalk, wasn’t it? A: No, far from it. Firstly, I didn’t join the business till I was at least about 17 or 18. I actually started selling cars and houses in London on my own without joining my family business. Then, I came back here, started off as a trainee in the textile factories, essentially had cotton coming out of everywhere, and then decided it wasn’t really for me. After a few years of that, I decided to move partly to Russia. I worked in Russia on my own, set up a few businesses over there, and then finally, came back to join the group when I was about 25 or 26. Q: How did Go Air come about? A: It was around 2000-2001, when I started doing a lot of social work in my free time and I used to work under the leadership of Nanaji Deshmukh, who unfortunately is no longer with us, but his legacy and his vision stay with us. His vision is essentially to make India self-reliant. He said that India lives in its villages and the villagers should stay in the villages and not try and come to the cities where they don’t have a proper lifestyle. Ultimately under his leadership, we began teaching farmers in 2,000 villages in and around India, how to have 12 months of consistent water, fertilizers that actually don’t damage the soil i.e. purely natural fertilizers and to make them understand how to do business. The latest venture is in Madhya Pradesh in a place called Chitrakoot. What we do is to tell farmers to do 50 per cent of their acreage into mass crop, 25 per cent into vegetable crop and 25 per cent into a food crop. We do R&D for each of these villages so that we don’t tell them to grow something and then it doesn’t work because of the soil condition and the environment. There was no air connectivity. With all the resources that I have, I could not get there unless I took a train, which took me 17 hours each way. Very simply put, a person like me who is very fortunate given in terms of what I have, if a person like me cannot follow my dreams on a simple issue to do travel or a lack of connectivity, how is the rest of India going to prosper? I wrote the business plan of Go Air on these many train journeys to Chitrakoot, and back again in 2005, we launched Go Air. The objective was to commoditize air travel and ensure that people migrated from trains. There are 17 million people who go by train in a single day. Last year, we sold 64 million seats as an industry. But every day in India, there are 17 million unique people, not seats, who travel from A to B. So the opportunity is extensive. Q: What do you do in these times when the airline industry is not quite in the peak of health? How do you, at Go Air, plan on tiding over these tough times? A: We have been profitable and we continue to be profitable last quarter. We took a decision when we launched that you have to have patience in India. So what we said was that the business has to be built over the next 10-15 years. It is a long-term business. It is not a sprint. It is a marathon, and we have a track record of running quite healthy marathon since my group and family have been around for 275 years in India. We decided to start on a small basis. Between 2005 and 2015, we began small and decided to bring in a very limited number of capacity. The reason we said this was because we wanted infrastructure to improve, we wanted policies to improve, we wanted taxes to improve. These, I would say, are enablers to creating a healthy air in terms of industry. They have been extremely inefficient, and over the last few years, they have improved. As a result, we have decided to basically grow very aggressively from the year 2015. Hence, we bought 92 Airbuses from the French manufacturer Airbus. So far, we have taken delivery of 13 of those 92 and we have planned it as a J-curve. The J-curve essentially means that capacity very aggressively starts kicking in around 2015. Q: You have also now entered into the realty industry. A: Initially, we started Bombay Realty to capitalize on its two main assets. We have two assets in central Bombay. One in Worli, which is the west coast of Bombay, and the other in Dadar in the east coast of Bombay. Essentially, the objective is to say how can we improve life? How can we give our customers a better life? How do we create a situation where you can live, work and play in one location without having a dependency on the car. Therefore, we said let’s create two mixed-use developments. What is a mixed-use development? Very simply, it has to have residences, offices, a hotel, a mall, a high street, a school and hospital with obviously large open spaces and so on. In Wadia International Center (WIC) in Worli, we will be launching The Plaza, which is a high street; it is a luxury high street focussed on one segmented shopper with restaurants, a lounge or bar and many other entertainment in terms of activities for the shoppers. It is like a destination that we are trying to create. So both these mixed-use developments ultimately have to start somewhere and end somewhere. So in Dadar, we have started with residences and we will end with a hotel, offices and school coming up. In Worli, we have started with retail. We will migrate to another hotel, to the offices, and then finally, we will do the residential last over there. _PAGEBREAK_ Q: Where would you say the average or the affluent Indians are in terms of the frequency of their luxury spend or Indian spending right now? A: We speak to a lot of brands and many of them are interested in coming to Mumbai. Most of them have already opened one store, they want to open a second store, very few of them now want to open a third store. There are people who are not in Mumbai, who want to come to Mumbai. India is growing at 6-7 per cent. The brands have to be here. There might be a year, two year or three years of pain, but ultimately, there is a long-term gain. Q: Talking about some of your other businesses, you recently became the MD of one of your group’s oldest company's Bombay Dyeing. How do you envision taking this forward to the next stage of evolution? A: Bombay Dyeing has been around for 136 years. We are trying to restructure how we deliver valuable products to our customers.  Previously what we used to do is manufacture a lot of what we sold, and now, we are going to focus on selling what people want, not necessarily selling what we manufacture. Home furnishings basically would mean everything in your home, and then migrate to something called home solutions so that people who don't have time today to look at if they are changing their living room or of they are changing a dining room, they don't have the time in terms to go to one shop to find the wallpaper, another shop to find the chandelier, another to find the table, the chairs, the cutlery. Home solutions, to us, means it's a one stop shop. We are going to re-launch as soon as we have concluded our plans, which is a new brand focussing on bed and bath and a new brand focussing on home furnishings. Q: Tell me a bit about what it was like growing up in India's oldest business family? A: It was incredible. My father and my mother impart values, they teach us how to be grounded. It was a very relaxed atmosphere growing up with my parents. But at the same time, it was always about having the values and having the hunger. Just because we have what we have does not mean you don't have to be hungry, and that was in terms of what it was like growing up. Q: You said at some point that going to boarding school gave you your sense of independence. How exactly did the course of your life change once you came out of boarding school? A: I used to be a 'mamma's boy' while living in Bombay. Then suddenly when I was taken out and was sent to the Himalayas, my world was shattered. But things had to be done, lessons had to be taught, that's what usually the parent and the child relationship is. That, in itself, gave me a lot of independence. If I hadpossibly stayed in Bombay shielded by my mother throughout my educational life, I would have been a very different human being. Q: Speaking of home, did your business training with your dad start at a very early age or did he let you have your run and then rein you in? A: Training with my father started virtually since I was born. But yes, he obviously had allowed us to do what we want to do. That gave us the ability not only to say that just because we have our father, we should join the family business. Q: So that wasn't always in the cards? A: No, it was extremely liberal in the form of saying, ‘do whatever makes you happy’ and that gave us the opportunity to explore other businesses, explore in terms of being managers in other businesses and working our way up the ladder. When we did come back to the family business, both my brother and I, had to climb the ladder. We weren't given any comfortable-cushy jobs. Ultimately, my father is an extremely result oriented chairman because it's a professional job that he conducts; it's not a family job. In our family, you either earn it or you don't get it and the results show for themselves. Q: There is a lot of criticism globally. I know there was a report in the Economic Times once about the dynastic nature of businesses in India whereby it doesn’t breed the variety in executives as compared to corporations around the world would. What do you think about that? A: Before I joined my family business, there was a lot of introspection on this particular point. I believe that there is a difference between ownership and management. What I have learnt in India is that most people don’t understand the difference. When they don’t understand the difference, that is when you have emotional decisions being made, which are wrong. That is when you have family feuds, and ultimately, the idea of a family or a corporate is to separate itself by saying it needs to focus on managing ownership versus managing management. Let the professionals manage the businesses, let me manage in terms of my investments. What I have learnt and understand in India is, that the minute you think you are the owner, the next minute, you walk out with your toolbox and you walk around your business with the toolbox, take out the pliers and you start fixing things. You think you know better than the professionals in each of the departments. If that is the case, why do you hire them? Ultimately in our group, we focus on the professionals running businesses. It so happens that I am the managing director of two of our growing concerns. But overtime, there will be professionalized chairmen of each of the group companies we have, and the owners will move and progress up to what we call the shareholder group, which is the Wadia group. Q: Who is the bigger disciplinarian between your mom and dad? A: I couldn’t say one was more than the other. They were both consistent. Q: Who would they try to pacify a little more? Who is the bigger prankster - you or Ness? A: I would have to say Ness was more of a prankster. Q: You have a wonderful family, two beautiful kids, and of course, lovely Celina. She must be the real backbone and support? A: She is, completely. Ultimately, men who lead in the front are only as good as we have at home. It is impossible to do what we do and focus and persevere from morning till night on creating value and running businesses without having an extremely understanding wife who holds it together. Ultimately, she is the glue and the support and the springboard. Q: How did you two meet? A: We met in London when she was 19 years old. She was studying in London. I had finished studying in London. I was working in London and rest is history. Q: I know you enjoy travelling, which is a prerequisite if you own an airline. What is your idea of exploring the world? A: I like going to different countries, eating different foods. The target I have given my kids is that they should learn 6 languages by 16. _PAGEBREAK_ Q: How many languages have they picked up till now? A: At the moment, they are on two, including English. Q: Is it Hindi and English? A: Hindi and English, and now we are progressing to Italian and Spanish, and then, hopefully Chinese and Russian. Every year, when we go on a summer holiday, I like to take them to one of those countries and we stay there, understand in terms of the culture, understand the people; just talking to waiters, shopkeepers and people on the streets gives them the understanding. It gives us the ability to understand different cultures and impart the same knowledge to our kids. Q: You once said that in terms of music, you fear that the music should be created with natural sounds and very little words. What would your iPod playlist consist of? A: My son likes my trance playlist. I listen to trance music. I still like music without words. Q: Where would you find Jeh when he has got to escape from it all? A: At home, with my kids and my wife. Q: What’s a normal night out for you? A: I don’t get home from office till 10:30 p.m. So, usually that’s a typical night. Q: What about restaurants? I know you are foodie. A: We try and get out at least once or twice a month either for Japanese meal or Italian meal, but that’s it. It’s not more than usually twice a month. Q: You are usually always very dapper in your style and what you are wearing. Your mom is a style icon. Tell me what defines your style quotient? A: While I was running GoAir, it was jeans and a T-shirt because it was supposed to be no frills. Therefore, you rolled your sleeves up. It was the attitude and the entire culture that needed to be created. Since I took over the Real Estate Company and Bombay Dyeing, it is more of a formal attire because they are public limited companies and I represent my shareholders. Therefore, when it comes to working in a public limited company, you have to set examples, you have to lead from the front. Unfortunately or fortunately, you have to dress in formals. The days of wearing jeans and T-shirts are over. Q: What’s your ideal holiday destination? A: Europe, Italy, France and Spain. I love the coast. Staying on a boat and going from coast to coast is where I belong. I am essentially a sea person. Q: And your kids, you must have to do a lot of children-oriented travelling as well? Disneyland and things like that? A; Yes, we go to Disneyland. I love the rides. My kids love the rides. For me, it’s a theme going on adventure. I don’t actually dread going to Disney World because I am the biggest kid. So I am the first one and the last one on the rides. So from morning till night, we are all on these rides and eating candy. It is very interesting in terms of adventure. Disney World is taking entertainment for kids to a new level. Q: Your idea of happiness? A: My wife. Q: Your real life hero? A: Both my mother and my father. Q: Peace, culture or adventure? A: Peace. Q: Airlines or real estate? A: Tough one, real estate. Q: The restaurant you would travel further for? A: Nobu, London. Q: A brand that defines you? A: Brioni. Q: And on the bucket list? A: Too many.