Amar Singh is also a 'power'ful businessman

A few days ago, the Supreme Court lifted the five-year ban on some CDs that purportedly contained Amar Singh's conversations with some topnotch industrialists of the country.

Singh retorted these were snatches of just harmless banter between fellow industrialists. Not just a politician, the message was unambiguous, Singh is also a businessman -- big enough to be consulted by the honchos of India Inc. But what is his business?

Singh, by his own admission, is a 'frequent' investor. "I am a shareholder in many companies. Being a shareholder is not a crime. I don't remember in how many companies I have invested."

Amar Singh is the chairman of EDCL, a company listed on the stock market. The company is into power generation and other infrastructure projects such as roads, bridges and buildings. It also operates and maintains power plants for others.

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"We generate almost 14 MW of power, and I think by the end of this year it will go up to around 100 MW because two projects are coming up in Kerala," says Singh.

But he declines to disclose how much of EDCL he owns. "Whatever it is, I am not going to discuss it. Whatever shares I have is good enough for me. Let professionals run it and grow it."

Singh says that he has tasked some consultancy firms for this purpose. "A 14-MW company when it becomes a 100-MW company may earn gross profits of up to Rs 70 crore (Rs 700 million). This income is very good to take care of a living but that size of income and business is not likely to give you the prominence you are used to."

But some information is in the public domain. Numbers culled by the Business Standard Research Bureau show that the sales of the company grew steadily from Rs 12.98 crore (Rs 129.8 million) in 2005-06 to Rs 61.68 crore (Rs 616.8 million) in 2006-07, Rs 65.74 crore (Rs 657.4 million) in 2007-08 and Rs 117.24 crore (Rs 1.172 billion) in 2008-09, before falling sharply to Rs 31.58 crore (Rs 315.8 million) in 2009-10.

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Profit before interest, depreciation and tax rose from Rs 9.80 crore (Rs 98 million) in 2005-06 to Rs 13.85 crore (Rs 138.5 million) in 2006-07, 24.18 crore (Rs 241.8 million) in 2007-08 and Rs 26.91 crore (Rs 269.1 million) in 2008-09 and fell to Rs 17.87 crore (Rs 178.7 million) in 2009-10.

The company has paid a dividend of 10 per cent in each of the last five financial years. The EDCL stock closed at Rs 37.10 on May 13, which puts its market capitalisation at Rs 102.03 crore (Rs 1.02 billion).

The promoters' stake in the company is 56.13 per cent. Non-promoter corporate holding is another 29.94 per cent, which leaves a floating stock of a tad under 14 per cent. The stock in the last one year touched a high of Rs 81.25 and a low of Rs 29.

Singh, in addition, is the vice chairman of AB Corp. In the days to come, however, he wants to quit from the board of both the companies, first from EDCL and subsequently from AB Corp.

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The reason being the difficulty he faces as a 'politically exposed person' in raising funds from the financial institutions.

"I will resign from AB Corp later because people will otherwise say that I have had some misunderstanding with Amit-Ji (Amitabh Bachchan), which I don't. It is just a business decision on my part," says he. "I will still have a majority stake in EDCL, and by way of dividend I will get a lot of money."

Singh says he was an industrialist before he came into politics. "In the mid-1980s, my father was in the wholesale trade of hardware and building material in Burrabazar, Kolkata. He was fairly successful and a high middle-class trader . . . very comfortable but not filthy rich. I started a small alcohol-based chemical unit in Ghaziabad towards the end of the 1980s, which is still being run successfully but I am no longer involved in that," he says.

But life changed once he got into politics. "My political activities and persona became larger than industry; industry for me became like salt in food or sugar in tea."

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In a country where crony capitalism is the rule and not the exception, politician-industrialists often find themselves at the receiving end of public criticism.

"I was conscious of the fact that I will not do any business in Uttar Pradesh where I will have to go from one bureaucrat to another (for clearances and approvals), otherwise rival politicians would have said I exercised my influence," says he, referring to the years of Samajwadi Party rule in the state.

During those days, Singh was particularly close to Mulayam Singh Yadav, chief minister and Samajwadi Party supremo. The two have since fallen out and Singh has been eased out of the party.

"I have also not gone in a state where Congress is in power, with the exception of Arunachal Pradesh. When I went to Kerala, Congress was not in power. I have not taken any favour from any regime," Singh stresses.

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Whatever be the case, Singh is not unhappy about what he has accomplished as a businessman.

"I don't have to worry about my bread and butter, and about my family's livelihood. Otherwise, sustenance would have been difficult," he says.

Singh has always been a resourceful man with the uncanny gift to bring diverse interests together. He was instrumental in bringing together a bunch of high-profile businessmen, including Anil Ambani, Kumar Mangalam Birla and Nandan Nilekani, in the Uttar Pradesh Development Council when Yadav was in power.

Singh says that it was his knowledge of the nuances of industry due to which people trusted him when it came to taking investment decisions in Uttar Pradesh. He sees a parallel in Mamata Banerjee roping in Amit Mitra, the former head of the Federation of Indian Chambers of Commerce & Industry, in West Bengal.

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"As long as you are not taking any economic benefit from that, it's absolutely fine," says he. "Nilekani had hosted a couple of the council's meeting in Infosys. There was no budget for this council. There was no executive power, just suggestive power."

"My halo is not the executive power I enjoyed; my halo is the proximity to people in different walks of life, which is very informal. Some are visible, some have vanished or are on the verge of vanishing, but there are many which are still hidden, latent," says he.

"I have earned it the hard way, and there is no point showing off as people unnecessarily feel envious and jealous."

Whatever else, Singh has never had to struggle for words.