Fortune India 40 Under 40: How next-gen entrepreneurs are reinventing legacies

When a first-generation entrepreneur sets out, the appetite for risk is quite high because there is nothing to lose. But when it comes to the next generation, the appetite may not be as high as there is a lot more to lose. But then there are many outliers in legacy businesses who are betting on new growth avenues.

One such outlier is Aman Mehta , the managing director of Torrent Pharmaceuticals . The first diversification of Torrent was led by his father and uncle in the 1990s in the energy sector. They saw the Indian market opening up after liberalisation and saw that as a big theme of growth. “It was more about identifying trends where you could play a catalyst to GDP growth, and for almost 20 years, we didn’t diversify anywhere else,” Mehta said at Fortune India's 40 Under 40 awards in Mumbai on Saturday.

The Torrent Group has now diversified from two sectors to four. These include city-gas distribution and sports. “India had to be a gas-based economy and increase the number of piped gas and PNG connections. That was the thinking 9-10 years ago. In sports, we could capitalise on one opportunity that came up. So, it’s more about identifying the trends on what could be the new economy growth avenues and do we have a right to win in those and take those bets accordingly,” Mehta explained.

Another such outlier is Keshav Reddy , founder of Equal and scion of the GVK Group. While GVK built physical infrastructure with power, airports and roads, Reddy is building digital infrastructure.

"Over the past 30-40 years, GVK Group has built 6-7 large businesses. That innate spirit and value system is what I have as well," said Reddy. "The next avenue for growth is going to be software, technology, AI and that is where my legacy will get built."

"Each generation will do something different. We started with Equal three years ago. In three years, we have 95 million Indians as customers. We process a billion transactions. We are India's largest data sharing company," Reddy said. "The next five years are going to be even more exciting. The vision is to have half the country using us or about 500 million users." Reddy claims Equal is going to make life of an average Indian easier. "That’s the sort of legacy I am going for,” he said.

Avantika Saraogi , executive director of Balrampur Chini Mills Ltd (BCML), and a fourth-generation member of her family business, is another such maverick. “We make sugar, ethanol, and bagasse-based power. Now, we are going to make bioplastic from sugar. It is going to be the first plant to make bioplastic from sugarcane in India,” Saraogi said.

On the company's ₹2,850 crore capex plan, Saraogi said it took four years to convince the board to get a green light. "India’s sugarcane price is set by the government. That will always go up. So we had to answer what if Indian sugar price goes higher than global sugar prices," she said, adding that the sugar industry is sometimes bitter to run. "The only way to excel is by efficiency."

Torrent Pharmaceuticals' Mehta also spoke about the company's future growth plans. "There is a lot that my father and uncle have built over the last several decades. The first objective would be to keep the core strong, which is strong branded generics business in India, Brazil and a few other markets. Then comes the next part of where we are not so strong. We are very open in acknowledging that maybe our international business is not as strong as it should have been. That’s where a lot of our focus will probably be in the next couple of years. Maybe our next capital decision could be in international markets," Mehta stated.

On the ongoing tariff war, Mehta further said that his father and uncle have always looked at problems and crises as opportunities. "That’s when things can be used to an advantage. It’s not always all bad. And they have seen those cycles many times over. That experience that they would have had gives them the confidence to navigate the current geopolitical change," he added.

In the pharma industry, in the last couple of months, everyone was in a wait-and-watch mode, Mehta said, adding that the wait is coming closer to an end. "The general sentiment is that change is going to come soon and we have to be prepared. We don’t know what extent it could be. But if you want to be a relevant player in the US, a minimum commitment to the US market will be required, which may mean manufacturing or R&D, which was never really the case so far. It’s a big change and companies will have to gear up. There is no option," Mehta said.