BS Annual Awards 2021: Stellar jury picks the best of India Inc

A high-profile eight-member jury to select the winners of Business Standard Annual Awards for Corporate Excellence 2021 met virtually late last week and picked the best of India Inc.

The jury was chaired by Aditya Birla Group Chairman Kumar Mangalam Birla and included JSW Group Chairman Sajjan Jindal, KKR India Senior Advisor Sanjay Nayar, AZB & Partners Founder and Managing Partner Zia Mody, EY India Chairman Rajiv Memani, McKinsey & Company Senior Partner Noshir Kaka, Cyril Amarchand Mangaldas Managing Partner Cyril Shroff, and Bain Capital Private Equity Chairman Amit Chandra.

“The jury had rich, open, and extensive deliberations to shortlist the winners this year. Almost every category had very high-quality nominees, and the diverse experience of the jury came to the fore as we selected the winners. The jury process was thorough and stimulating, and it was backed by the analytical rigour of the BS team. The range of the winners also reveals the critical role played by the pharma and health care sector over the last two years,” Birla said.

“My heartiest congratulations to all the winners.”

Several names came up in the course of discussion for these coveted awards. But what tilted the scales in favour of the winners was the confidence of the jury in their business models, which weathered the severe pandemic storm, and the disruptions and innovations they have brought in their respective industries.

Infosys Chief Executive Officer (CEO) and Managing Director (MD) Salil Parekh was selected CEO of the Year for the extraordinary turnaround and outperformance of the IT major. Cipla’s outstanding performance and contribution to the health care sector helped it bag the Company of the Year award.

Bharat Electronics was chosen Star PSU of the Year; Procter & Gamble Hygiene & Health Care Star MNC; Dr Lal PathLabs Star SME; and Zerodha Broking bagged the Start-up of the Year award.

The jury was unanimous in their choice of Prathap C Reddy, founder and chairman of Apollo Hospitals Enterprise, as the winner of the Lifetime Achievement award.

As jury chairman, Birla started the deliberations by asking the jury members to disclose conflict of interest, if any, with the shortlisted candidates. The jury was earlier provided a list of companies based on their financial performance, compiled by the BS Research Bureau, to name the award winners in the seven categories.

Birla set the tone of the meeting by stating upfront that apart from the financial data, due weight should be given to strong ethical attributes, in addition to a long-term business vision in a year that saw extraordinary challenges and disrupted established business models overnight.

Contribution to society during the Covid pandemic; environmental, social, governance (ESG) standards; steering the ship during a crisis; and consistent performance were the buzzwords that figured prominently during the jury deliberations. Some jury members also pointed out the exemplary contribution of unlisted companies to the Indian economy but due to lack of financial data in the public domain, they could not be considered for the awards.

Jindal, who won the award in 2017 and joined the meeting from London, was of the opinion that a company’s consistent performance during the pandemic year should be kept in mind in selecting the winners.

Outstanding achievements like those of Parekh and Cipla can hardly go unnoticed, when a distinguished jury comprising the heads of India’s two leading conglomerates, two leading private equity funds, two global marquee management consultancy organisations, and two top legal eagles meet to decide the winners of the awards for corporate excellence for the financial year ended March 2021 — one of the worst periods for companies across the world due to the pandemic and several lockdowns induced by it.

As the nation was hit by the pandemic, like the rest of Corporate India, Infosys changed its business model overnight and asked its employees to work from home, keeping in mind the safety of the workforce.

India’s second-largest IT services provider reported revenues of $13.56 billion in 2020-21. In rupee terms, they came to more than Rs 1 trillion in 2020-21, a year-on-year growth rate of 10.7 per cent, while net profit grew faster — by 16.6 per cent — year-on-year to Rs 19,351 crore. As Infosys has seen a sharp turnaround in performance and beaten peers like Tata Consultancy Services in growth, its market valuation, now over Rs 7.88 trillion, has clocked a compound annual growth rate (CAGR) of about 40 per cent over the past three years. Over a year’s period, the same is up about 48 per cent.

Under Parekh, who became CEO and MD in FY18 amid turbulent times, Infosys has pivoted its growth strategy on three pillars — the agile digital business, energising the core, and reskilling and localisation. In all these areas, it has progressed well. Since his appointment, Parekh has not looked back as Infosys bagged new orders of billions of dollars and gained the confidence of its investors, clients, employees, its board, and other stakeholders.

“The deliberations on CEO of the Year were quite evolved and there were quite a few candidates. Salil came out as the consensual choice due to very, very strong performance since he took the reins. And as we all know, he took over as Infosys CEO at a very tricky time,” Nayar said.

Mumbai-headquartered Cipla is the third-largest pharmaceutical company in India, the third-largest over-the-counter (OTC) player in South Africa, the eighth largest by prescription in the US, and the second-largest Indian exporter to the emerging markets.

Established in 1935, Cipla’s revenues for 2020-21 grew 11.8 per cent to Rs 19,160 crore, while profit after tax (PAT) jumped 55.5 per cent to Rs 2,405 crore. Between FY18 and FY21, Cipla’s revenues clocked a CAGR of 8.1 per cent, and PAT grew by 19.5 per cent annually.

The company, which has seen a generational change in its leadership, draws 40 per cent of its revenues from India and 21 per cent from the US market. The South Africa region, emerging markets, and Europe contribute 18 per cent, 10 per cent, and 5 per cent, respectively.

On selecting Cipla as the Company of the Year, Shroff said the performance had been outstanding and there were several other interesting aspects as well in view of the contribution to the health care sector, particularly during the pandemic. “The fact that the generational transition was so smooth, so it was quite an iconic performance and it was a pleasure for the jury to select Cipla,” Shroff said.

All jury members agreed that while financial ratios were important for making the first cut, equal importance had to be given to individuals who focused on innovation and built institutions when challenges in the external environment were severe due to restrictions imposed by the governments to control the pandemic.

The jury discussed several outstanding individuals who have left a deep and lasting impact on India’s corporate history, but was unanimous in their choice of Prathap C Reddy, founder of Apollo Hospitals, as winner of the Lifetime Achievement award.

“We chose Prathap Reddy, considering the creditable work done by him in the space of health care, especially during the time of the pandemic. He seemed to have a very good succession in place and the company showed good numbers,” Birla said.

The jury recognised that Reddy, 89, is a trailblazer not only in the world of health care but also as a philanthropist. He set up Apollo Hospitals in 1983, India’s first corporate chain of hospitals, and introduced world-class health care across the country. Today, the company has a market valuation of almost Rs 67,000 crore. Reddy was conferred the Padma Vibhushan in 2010 — the second-highest civilian award in India.

The jury debated several candidates for the Start-up of the Year award. After a long discussion, Zerodha, with its profit-making business model, was selected. “There were many exciting choices and eventually we all settled on Zerodha, which is a pioneer in innovation on multiple fronts like introducing flat fees and has gone from strength to strength,” Kaka said.

On Star PSU of the Year, the jury felt the candidate should show outstanding financial metrics, apart from facing competition from the private sector besides its peers. After a discussion on several companies, it zeroed in on Bharat Electronics. “The company was a unanimous choice of the jury due to consistent performance on various financial metrics — be it sales growth, or profit growth. All this leading to a significant increase in the market valuation over the last three years and the market recognising the fact that they (Bharat Electronics) have tremendous potential,” Chandra said.

For the Star MNC award, the jury selected Procter & Gamble Hygiene & Health Care, based on its sales and profits, and notably the innovations it has brought about, helping the company sustain its lead in the feminine hygiene industry.

“The jury selected P&G Hygiene for its consistent performance and very strong financial metrics. They have guarded their market share very tightly despite many people (companies) trying to get into that segment,” Memani said.

On selecting Dr Lal PathLabs as the Star SME of the Year, Mody said the company stood out for its consistency and brand recognition during the Covid times. The company’s sales grew by almost 19 per cent and net profit surged over 29 per cent in 2020-21, over the previous year. The three-year CAGR in the two metrics is 14.4 per cent and 19.5 per cent, respectively.