A week in the life of Lucy Walker

Lucy Walker is a fund of funds manager at Sarasin & Partners. Her diary runs from 6-10 October.

Walker

Monday After a 10-hour flight, I touch down in Mumbai’s impressive international airport at 11.15 and head straight to Worli (the business district) for an afternoon of meetings. First up is K.C. Chakrabarty, ex-deputy governor of the Reserve Bank of India, known to speak his mind, and he certainly does not disappoint. He views India’s productivity levels as at rock bottom, meaning the government does not need to do much to get growth back up to near double-digit levels. Later,

I meet Deepak Parekh, chairman of HDFC, India’s largest private sector bank. He highlights “digital India” as a key priority for Prime Minister Modi as and the “first step in uncorrupting India”. That evening, I have dinner in the city with a group including trip hosts Ocean Dial, a boutique asset manager specialising in India.

Tuesday Up early for a day of meetings in various company offices around Mumbai. The standout was a pharma company called Lupin. Historically domestic and focused on making ingredients, in 2003 it decided to diversify internationally and move to higher-margin products. Today, it has grown the bottom line by over 30 per cent. Lupin is a prime example of a company which has changed its fortunes by focusing on return on capital rather than simply growth. Given India’s current healthcare spend is only 4 per cent of GDP (versus the US at 17 per cent), this also provides a huge tailwind for the company. After an exhausting day, I have an early night.

Wednesday First meeting of the day is with fast-moving consumer goods company Jyothy Labs. Its most popular product, a fabric whitener, has an eye-watering 75 per cent gross margin. In 2011 the company acquired German multinational Henkel’s India business for only 1.5 times sales but with it took its huge debt burden. Critics suggested Jyothy would never be able to integrate or turn around the ailing business but today the company has transformed its EBITDA from less than 11 per cent to almost 15 per cent. After more meetings I head to the airport for a very bumpy flight
to Delhi.

Thursday An early start for a breakfast meeting with T.S.R. Subramaniam, former cabinet secretary, who sang Modi’s praises, highlighting that India’s best prime ministers have always had experience managing states. Next up was the highlight of my trip, meeting Anil Swarup, whose team facilitates infrastructure projects. Previously there were eight separate clearances which were opaque and inefficient, but Swarup has now brought these online, ensuring transparency and accountability.

Friday The last day with a number of interesting meetings. Firstly with the journalist author of a Modi biography looking at his lesser publicised dark side. Next is the Ministry of Finance, where on entering I read a sign that states: “Do not pay bribes. If anybody of this office asks for a bribe, complain to…” which sits well with Modi’s anti-corruption campaign. My final meeting of the day is with Vinayak Chatterjee, who sits on the Prime Minister’s Advisory Council on Infrastructure and describes the difficulties India faces following years of underinvestment. My flight home leaves later that evening and I thankfully have a quiet weekend ahead to recuperate.