Gharda: The Iconoclast
Keki Hormusji Gharda has never been one to accept the status quo. Whether it was finding a better and cheaper way to develop the blue dye used in school uniforms during the 1960s or defying multinational companies’ desire for the exclusive license to manufacture certain pesticides, Gharda stood up against the conventional wisdom.
It’s an attitude that has characterized Gharda Chemicals for more than 50 years. The company prides itself on its research and development accomplishments. That dedication has earned the company scores of domestic and international awards.
In 1967, Dr. K.H. Gharda established Gharda Chemicals as a partnership firm and started operations out of a rented shed in Vakola, a sleepy suburb of Mumbai. Today, Gharda is one of India’s leading agrochemical companies.
As it is currently constructed, Gharda comprises five manufacturing units located around the country. Through the years, Gharda has recorded many firsts in dyestuffs, agrochemicals, veterinary drugs, and polymers. But it was the company’s first product that jumpstarted its road to success.
Phthalogen brilliant blue, popularly called “German Blue” was imported from Germany 1960s when Gharda was a fledgling operation. Dr. Gharda examined the dye that Bayer sold in India, and it figured out the product was a mixture of a dye and a chelating agent that helps the color stick to the fabric and not a compound. Gharda Chemicals began developing its own version of the dye. “Gharda Blue,” as it became to be known, was better and stronger than the original and a resounding success.
In an interview with Rediff India Abroad, Gharda explained how the company got involved in the manufacture of agrochemicals. “Well, there is a saying, ‘call no man rich until he is dead.’ Yes, we have been profitable, but somewhere in the late 1970s all the products we were making suddenly became unprofitable because the government imposed a 35% excise duty on dyes and intermediates. Since we were honest, we could not compete; many others just evaded the duty.
“That year we made a good solid loss. But in one year, we changed our entire product profile and shifted from dyes and intermediates to agrochemicals.”
Gharda’s venture into agrochemicals began with isoproturon, a wheat herbicide. Today, the company is the largest producer of isoproturon in the world, utilizing a Gharda-developed process that has since become internationally known as the “Indian process.” The company continues to manufacture several technical-grade agrochemicals and has become a leading player in the global agrochemical scene.
Gharda’s R&D efforts have helped the company occupy a leadership position in many agrochemicals around the world including chloropyrifos, synthetic pyrethroids, dicamba, fipronil and isoproturon.
Gharda was the first Indian company to be granted regulatory approval in the U.S. for any pesticide – dicamba and chlorpyrifos.
The company also has several new products in its pipeline many specifically focused on fungicides. Gharda’s plan is to launch one new molecule each year for the next seven years.
Under the stewardship of Dr. Gharda, the company has always focused on delivering products of the highest quality at the lowest possible cost. New products have been introduced regularly to address the requirements of the farmers for a wide range of crops. Gharda’s entry into a new product segment has led to significant price reductions by competitors, in some cases by as much as 35% to 40%.
Legacy of Innovation
Even entrenched deeply in the post-patent side of the industry Gharda embraces its “rebel” attitude. Post-patent operations aren’t widely hailed for their focus on R&D. Gharda is one exception and for 30 years has dedicated between 3% and 5% of its annual turnover to R&D.
That commitment to a strong and vibrant R&D program has led to Gharda introducing 35 new products in a variety of industries including many firsts in the company’s manufacturing interests. The company has earned dozens of awards from government and industry.
One of which the company is most proud is when Dr. Gharda was presented with the FICCI Award by Dr. A.P.J. Abdul Kalam, the former President of India. The Federation of Indian Chambers of Commerce and Industry (FICCI) awards are given to “companies, institutions and individuals for achieving excellence in various fields of economic, social, technological and environmental development.”
Gharda might have started as a company that produced pigments, but agrochemicals are now the company’s mainstay and account for more than 60% of its revenue. Today, Gharda exports products to more than 50 countries.
Gharda’s culture clearly evolved from its less-than-traditional founder. There are several factors that differentiate the company from many of its competitors:
- Gharda is trust owned. Much of the profits are used not only for R&D, but to promote the development of science and society.
- The company places extreme importance on product purity and quality to prevent environmental damage.
- Gharda’s competitive advantage stems from process chemistry. All the processes have been designed in-house.
The Road Ahead
The agrochemical industry is seasonal and cyclical. It depends largely on unpredictable and often unhelpful weather conditions. Demand is mainly driven by the need to feed an ever increasing global population combined with a decrease in arable area. Gharda knows, however, the rising demand for food and cash crops can only be met by increasing agricultural productivity. Pest management will continue to be an important driving factor in increasing agricultural productivity.
Armed with that knowledge, Gharda executives take a long-term approach to planning. Gharda is currently planning its 10-year strategy. One thing has already been decided. The company plans to make significant investments in regulatory support.
Gharda constantly evaluates its product portfolio and the markets.
For example, executives noticed old molecules with economical chemistry are gaining importance. Asian agricultural markets are seeing high demand for commodities. Executives are exploring how to take advantage of these trends.
Any plan must consider the challenges the company faces. In addition to uncertain weather and the ever-present regulatory issues, Gharda is deciding how to deal with genetically modified crops. It’s not the crops themselves that are the concern, as GM crops usually work in conjunction with generic agrochemicals.
“The technology is still nascent and faces opposition from the anti-GMO lobby,” says N.P. Nair, VP of international sales.
Supply is also a concern, but Gharda has a plan to mitigate disruptions by striving to backward integrate major processes to the base raw materials and entering into long-term supply agreements with suppliers.
While exports are a key growth driver for Gharda, the domestic market is equally important. Gharda has a strong distribution network, and its brands have excellent reputation among farmers. The domestic sales team is 300 strong, and there are plans for aggressive expansion both in technicals and formulations.
While Gharda’s leaders work on the details of their 10-year plan, certain factors will be key to success:
- R&D: Strengths in research and develop and process chemistry result in lower variable costs.
- Operations/Manufacturing: Gharda’s in-house design capabilities and execution allow quick reaction to market demand.
- Marketing/Sales: A driven sales and marketing team and a strong distribution network give Gharda a global customer base comprising leading agrochemical/seed companies.
Wth the many variables affecting Gharda’s future, Director Commercial Nilesh Kulkarni says the company must be “agile, global and far reaching in terms of pricing, new product development and overall customer satisfaction.”