Tata group chiefs prefer to err on the side of caution when it comes to making public statements. Firdose A Vandrevala the managing director of Tata Power, is a refreshing change. 

Not only does he have a sense of humour, he prefers to call a spade a spade. In his first interview after he took over about a year back, Vandrevala spoke to S Ravindran and Reeba Zachariah on the company. 

Tata Power’s publicly stated vision was to become an integrated energy company. Why have you then decided to divest your stake in the upstream unit Tata Petrodyne? 

In any business that we are, we need to be on a growth path. You can’t have a business that is not growing, number two, some amount of emotion should be there but you can’t run all businesses on emotion. 

There must be passion and commitment but you should not get swayed by emotions. Merging, acquiring, disinvesting is part of normal business. So we are exploring — we have not decided to sell. We will do so if only we get the right valuation. We are not desperate. 

Where has the evaluation of bids reached? 

We are far away from arriving at conclusions. 

Financial bids have been submitted. BPCL has announced that it is interested. Any other name that you could mention? 

No, I can’t. We have signed confidentiality agreements. But we have received a number of interests — they are in double digits. 

When do you expect to take a decision? 

In a couple of months. 

Tata Power’s acquisition plans of acquiring AES’s stake in Orissa as well as ABB’s stake in the Neyveli project have come unstuck. Also, the plan to sell the Dabhol project appears to be in deep freeze. What are the other opportunities for growth through acquisition in India? Your predecessor Mr Engineer had earlier said that the company is eyeing acquisitions abroad. At what stage is this plan in? 

Acquisitions abroad is not on the front burner. Going abroad is not a high priority at this moment of time. 

When the opportunity comes we will certainly grab it. We are not averse to it but its not something we are pursuing aggressively. 

Within India, opportunities are in high value generation, transmission, distribution, value-added services. We are looking at all opportunities. 

In generation, we have a captive load of 1000 mw in Delhi, growing substantially, so we are looking at how to backward integrate. 

In transmission we are on a very big project — the Tala project — for which we are in discussions with financiers. That is going well. In distribution, we have to wait for opportunities. I wouldn’t say that Dabhol is totally in the cold. 

BSES already has experience in supplying power to certain parts of Mumbai. Further, they now have the financial muscle of the Reliance group behind them. Do you see them as potential competition who can enter your area? 

I think the opportunities are so big, that it is good to have more than one player. Together we can grow and shape the market. I see it as a strength. I don’t see it as any conflict. Because, together we can shape the nature of the industry so that the structure is stable, sustainable and the market grows. 

Coming to the broadband business, earlier there was some talk of merging it with VSNL or Tata Teleservices. What is the final take on that? 

The important thing — I think is agility and keeping your mind open. Any business plan cast in stone is a dead business plan. As markets evolve and these are highly fluid markets, you got to be able to adapt. It is like when Shane Warne is bowling — you can’t decide in advance to sweep (whatever be the delivery). 

It won’t work. You have to see how the ball and the pitch are, what are the field placements and then you decide what stroke you want to play. So we are all the time looking — where is the maximum value in the business. 

Today, the division is doing well. There is great opportunity and we have got a fantastic system. The type of fibre optic network and quality we have is not easy for anyone to replicate. 

Now at what moment of time what structure it will take — we have kept our options open. We are not in a hurry to sell it to VSNL or TTSL or anybody else for that matter. 

Our core team is doing excellent work; we are satisfied. And the telecom market is changing faster than any other market. At an appropriate time we will structure the business accordingly. 

There was also some talk about consolidating the strategic electronic business with Tata Power? 

No. The customer segments are different. It was a slightly neglected division. We have realised now the potential of that business and we have upped the ante of that substantially. We see it as a major revenue earner. 

What happens to Nelco? There was also some talk of merging Nelco with Tata Power? Was it considered at all at any point? 

I am not sure whether it was considered or not because I have just come. I would be surprised if it was not considered because my view is we must always consider all options. That is the role of management. 

You have to keep juggling with your portfolio depending on the current situation and future expectations. That is why we are examining Tata Petrodyne. 

What happens in the initial public offering of Tata Consultancy Services? Will Tata Power sell if it is offered an exit option? 

Could look at it. It’s a pie in the sky. As far as I know, no decision has been taken on the IPO, but when the IPO comes we will decide. We may sell all of it, some of it or none of it. We have so many options. Can’t tell you about the future. 

But selling is an option...
Always is.

Will there be any further exposure to the group’s telecom initiatives? I understand that you are the largest investor in Panatone Finvest (the special purpose vehicle through which the stake in VSNL is held) and Tata Teleservices. 

I don’t know if we are the largest investors. A large part of the investment has already been made. It is entirely the board’s privilege to go this way or that way, but there is no more substantial investment to be made, just now. 

Group chairman Ratan Tata has been saying that VSNL is looking at new businesses as companies like BSNL have drawn up plans to enter the international long distance telephony business next year. Do you see these new businesses as prospective avenues for investments by Tata Power? 

Look at VSNL, it has zero debt and Rs 2,500 crore in cash. 

It’s been a year since you took over... 

A year and 2 days! (laughs) 

Is your vision different from that of Mr Engineer who felt that the days of a company focused on power is dead. He felt that Tata Power must tap the synergies between telecom and power. 

I wouldn’t say that there is any difference in view. I would say the additional thing I am focusing on is organisational transformation. We want to move from being farmers to hunters. Speed has been a crucial element of my strategy. Copying Nike, I would say, Do It!