Mihir Parekh, Executive director, Nilkamal
Image by Hemant Moishra for Forbes India
IImagine your teacher at school repeating how plastic is not renewable and harmful to the environment. You are now sitting in class feeling self-conscious because you grew up in a family that has been using plastic products for over 40 years.
Meet Mihir Parekh, executive director at Nilkamal, the first member of the fourth generation to join the legacy business. Parekh says, “I started to spend time to understand why plastic is bad.” Parekh came up with the answer: It is being improperly disposed of and used. Parekh’s problem was to find a way to make something durable and reusable.
With this question at its core, Parekh created BubbleGuard, a division of Nilkamal. It is now the third largest vertical of the listed company Nilkamal (the others being furniture and material processing). Sustainability has been a core value of mine. It is something I am passionate about. BubbleGuard was established with the intention of creating a sustainable packaging system, according to Parekh (29), who studied mechanical engineering at University of Warwick and received his masters degree from London Business School.
Parekh left India in 2013 to study engineering, but he wasn’t ready to return to his family’s business immediately. He wanted to work in a company that would provide him with broad exposure. Avendus Capital, a local investment bank, was his choice. He worked in the consumer transactions team, handling transactions that ranged from logistics and warehousing to food and beverages and microfinance. Working in the consumer deal team gave me exposure to many different business models. Parekh says it was two years of hard work and dedication, but it was also enjoyable. The family was at a crossroads when Parekh joined the family business. They were trying to figure out how to make Nilkamal a future-ready company.
We have a well-established business so we decided to explore new business opportunities. Parekh says that my first role at Nilkamal was in business development. This meant that I would be able to identify new areas for diversification.
After working on his initial project for just over a year he realized that packaging fits well with the company’s ethos. In particular, plastic was used as the base material. The idea was to create something that isn’t available in India. Parekh created the vertical in the early part of 2017, but it took almost a full year to put up the greenfield site.
BubbleGuard: What’s the real deal? Parekh describes BubbleGuard as a material or type made from a patented European technology that creates honeycomb-structured plastic sheets.
These sheets are made into boxes and packaging materials specifically for reusable and returnable packaging. BubbleGuard, unlike most plastics, is made for reusability. These sheets can be recycled, which helps companies reduce their carbon footprint.
In 2020, Parekh was elevated as executive director and, over time, his responsibilities expanded to business strategy. However, Covid-19 was also a reality in 2020. India was subject to one of the most severe lockdowns anywhere in the world. This put pressure on companies that were not essential, which is the category plastics belonged.
According to the company’s annual reports, it was a difficult and challenging year for BubbleGuard. The first half saw muted sales. Due to low demand, key distributors and dealers were closed and orders for packaging were either delayed or stopped. However, a 40% sales increase helped to achieve a 6 percent growth over the financial year.
Parekhs primary focus was on making sure we are agile enough to continue operations. Parekh realized that Nilkamal’s core purpose is to make furniture. So why not build hospital furniture? This is a crucial moment in the company’s history.
After rounds of brainstorming, his team came up with a waterproof and lightweight hospital bed made from BubbleGuard, which could be installed in three minutes. The company donated 2,000 beds for a Covid facility in Delhi. The bed was only the beginning. The team began making Covid-related products, such as barriers for public transport, plastic barriers, and other products under different brands like VirusGuard, TravelGuard, etc.
Nilkamal reported revenue of 689 crore for the quarter ended September 2021, compared with 492 million during the same time last year; it reported net profit of 27.4 Crore compared to 49.87crore last year.
After Covid, the group realized that more people are purchasing via ecommerce. Parekh currently leads some strategic initiatives to make the company digital-friendly.
He also managed family investments in startups, most of which were into tech-driven home-related and furnishing companies. Parekh explains that the goal is to use these investments in order to build a stronger capability, and to get a foothold into the tech-driven furniture market.
Mihir joined Avendus as a young, energetic lad. His sincerity, dedication, and strong business acumen made them stand out. Abha Agarwal, Avendus’ investment banking business leader, said that Mihir is a thinker and knows when to pivot a strategy. Nilkamal’s intuition has allowed him to shift gears, from packaging to supporting India’s healthcare infrastructure in the middle of a pandemic. He has developed to be a skilled entrepreneur, opening up new growth avenues for his company.
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(This article appears in Forbes India’s 31/12/2021 issue. Our tablet version is available for purchase here Magzter.com. Click here to visit our Archives.