Edible Oil Industry

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Mahesh Edible Oil Industries Limited

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MAHESH EDIBLE OIL INDUSTRIES LIMITED

January 1, 2005, was a cold foggy morning in Agra. But there were warm smiles on the faces of the Rathour brothers and their employees. The glass panel of the entrance announced: CONGRATULATIONS YOUR COMPANY HAS JUST CROSSED Rs. 100 CRORE MARK Shiv, Brij, Dinesh and Mahesh, the four Rathour brothers, shared sweets with their employees. Shiv, the eldest brother, had a serious look. He looked out of the window. Thanking the Almighty for His grace, he flashed back to the late 1970s, how, as an energetic 11-year-old he had joined his father in trading mustard seeds. His father, Ram Babu Rathour, a simple, down to earth, humble man, belonged to an agricultural family in Chitora village, 30 km from Agra. In early 1960s, he commenced trading business, buying loose mustard oil from small expeller1 units in Chitora and selling it door to door in the surrounding rural area on his bicycle. In 1965 he moved with his wife to Shamsabad, a small town 24 km from Agra. He shifted from oil to mustard seeds, pulses, wheat and cereals. The trading operation was in partnership with his friend and later with relatives. He and his partner invested Rs. 10,000 each. They purchased mustard seeds from farmers

Expeller was a machine for crushing oil seeds and extracting oil and getting the byproduct. The seeds were put in a funnel and passed through a clockwise rotating toothed cylinder. Toward the end of it was a crushing wheel rotating anticlockwise. The oil got squeezed out and flowed into a sump below the cylinder. Behind the crushing wheel, the residual was ejected out, which was used as animal feed. The oil produced by this method got heated due to the rotary motion. It lost its pungency. Research established that pungency was good for the heart.

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Mahesh Edible Oil Industries Limited

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coming to Shamsabad and sold to oil mills in Delhi, Kanpur, Haryana and West Bengal. They had a turnover of Rs. 2 lakh in the first year. In spite of using brokers for trading of mustard seeds, Ram Babu made it a point to accompany trucks with the seed to customer’s premises, in order to eliminate transit losses and insurance costs, and to collect payments. His eldest son, Shiv Kumar, was born in 1966. 1970s Shiv joined school in 1970. But he did not enjoy classroom learning. He preferred to spend his time outdoors. He observed business very closely. In 1977, after being unsuccessful in VII standard, he joined the family business. By then his father parted ways with his partners and worked in partnership with Shiv’s maternal uncle. When Shiv joined the business, this partnership too came to a close. Shiv started to handle trading operations with a turnover of Rs. 5 lakh. His father set up Babu Lal Oil Udyog with two oil expellers. They produced and sold 350 litres of mustard oil daily. Like father, Shiv accompanied trucks to deliver seeds to the oil mills. This gave him an opportunity to see the manufacturing process. In 1979, he started Mahesh Trading Company. He learnt about procurement of seeds, warehousing and value addition. Apart from monetary value, each visit to a mill gave him some food for thought. He asked “Why should someone add value to the seeds procured by him, not himself?” 1980s Shiv now had three brothers—Brij, Dinesh and Mahesh. All four worked towards a common goal, but had varying personalities. Shiv was a visionary, optimistic, extrovert and a force to reckon with. Brij Mohan was an introvert, pessimistic, highly analytical but with eyes of a hawk. Dinesh was an extrovert, over ambitious, confused and calculative who believed in having discussions with

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everyone but doing what he wanted to do. His discussions were directed towards getting endorsements to his own thinking rather than evaluating other’s viewpoint. Mahesh, like Brij, was a reserved person with a great understanding of human...
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