19 minute read
Letter from Editor
RESET YOUR PASSION
We have all found that the last 24 to 36 months have messed with our focus and lives. Our lives as entrepreneurs and corporates have changed drastically, even now, there is uncertainty how to proceed.
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I too was challenged by this phenomenon and had to dig deep to find an answer and solution. I found that I had to reset and refocus.
Easier said than done as it brings new challenges in itself.
My answer to this was to reassess my thoughts, my vision, my way of doing business, how I see my clients, and many more issues.
Out of all these thought processes then emerged another factor called “New Opportunities”
My vision has always been and still is based on a “From Me to You” attitude. I always ask the question; How much do I care? And not how much do I know? That goes for my business and for business that I am proposing you should do with me.
I have come to realise that doing a lot of things does not mean I get a lot of things done. I believe like myself, we don’t need “divine intervention” to take growth seriously, you need to reset and focus on growth opportunities around you and your clients. You can be a victim waiting for divine intervention or reset, focus and meet the challenges head-on. If it does not work then reset and refocus again. Remember you are currently where you are because of who you are and what you are. When you are in a storm you need to keep your focus and resetting may become a never ending task. When I became very disillusioned with redoing, rethinking, and replanning a true friend and business colleague said to me, “losing is milestone to winning.”
RESET means to me, A new way of thinking, seeing things differently, and taking advantage of all opportunities coming my way.
This is a new “Future” and we need to have the intention to build our businesses successfully by giving it a new purpose, intensity, a sense of urgency, and most importantly “ACTION.”
What we and our business will become in the future is based on our attitudes and what we want to become in life.
Annelize Wepener Editor
INDEX OF THE MAGAZINE VOL #23
contents
18
Diversity in Energy
06
COVERstory
Rajesh Gupta: Building a brand around authenticity
03 Letter from Editor
10
Building a brand around authenticity
06
ONpoint
New road capital: Duration and risk management
12 CYBEREASON: Five of the most dangerous randsomops attacks
18 Diversity in Energy
24 Lead generation strategies at work
28 The unpredictability of markets The unpredictability of markets 28
Robots ensure 80% cost savings for business process outsourcing services
32 Big money backs GIGI in commodities super cycle
34 The billionaires lost through time
36 XPERIEN redefines sustainability through art 38 Subsea cable connectivity: The key to accelerating digital transformation
42
TSHIKULULU social investments profits from automation
52
LIFEstyle
CITROEN C5 AIRCROSS
58 HYUNDAI venue N-line
64 VOLVO XC60 T8 Recharge
72
BEIJING X55-By BAIC; A preview of excellence
SMART GRIDS: A solution to power outages 44
46 Online grocery shopping fast becoming the norm
48 Combining solar and wind power in one renewable energy generation system
50 Nigeria, Cameroon inaugurate border bridge
51
FOCUSonEXCELLENCE
Transforming Africa markets: INDEX 2022 Publisher CEO Global (Pty) Ltd Tel:+27 82 883 4901 info@ceoglobalgroup.com www.ceoglobalgroup.com
Chief Executive Annelize Wepener annelize@ceoglobalgroup.com
Patron for CEO Global Foundation Lucy Quainoo
Mobility Correspondent Niki Louw Nikilouw68@gmail.com Tel: +27 66 244 1062
Consultant: Financial Support Carl Wepener carl@ceoglobalgroup.com
Special Projects & Content Development Consultant Vishnu Singh
Tel: +27 71 851 2066
Production Manager/Creative Director Enola Meyer - Mazeadilly design house enola@mazeadilly.com Tel: +27 61 048 0084
Printers Lexlines Press (Pty) Ltd Tel: +27 21 507 9030 Fax: 086 509 2749
* No article or part of an article may be reproduced or transmitted in any form without the prior written permission of the publisher. The information provided and opinions expressed in this publication are provided in good faith but do not necessarily represent the opinions of the publisher or editor. All reasonable efforts have been made to ensure the accuracy of the information contained in this publication. However, neither the publisher nor the editor can be held legally liable in any way for damages of any kind whatsoever arising directly or indirectly from any facts or information provided or omitted in these pages, or from any statements made in or withheld by this publication.
RAJESH GUPTA
BUILDING A BRAND AROUND AUTHENTICITY
FOR RAJESH GUPTA, TWO OF THE GOLDEN RULES IN BUSINESS ARE TO KNOW YOUR CUSTOMERS, AND OFFER THEM AN AUTHENTIC EXPERIENCE. AND CONSIDERING THE STAGGERING SUCCESS OF MAHINDRA SOUTH AFRICA UNDER HIS LEADERSHIP, IT IS CLEAR THAT HE IS ONTO SOMETHING.
BY SALOME POSTHUMUS
hen Gupta took over
Wthe reigns as CEO of Mahindra SA in 2018, he knew that a challenging journey lay ahead. South Africans have a notorious love affair with their SUVs and pickup trucks (locally called ‘bakkies’), and Mahindra was a relatively new entrant in an already flooded market. What he did not foresee was that his tenure would coincide with some of the most significant challenges the South African economy has ever faced – the Covid-19 pandemic, looting and unrest that disrupted supply chains, growing unemployment and increasing economic uncertainty.
Yet despite the rough terrain, Mahindra SA has achieved beyond expectations. The company’s compound annual growth rate (CAGR) over the last five years stands at around 25%, whereas the average for the South African automotive industry is –3%. Mahindra SA ended its 2022 financial year with an average sales increase of over 37%, and it consistently breaks its own 1,000-unit-per-month sales target. At its Durban assembly facility, which only opened its doors in 2018, the 10,000th bakkie recently rolled off the line.
A SECOND HOME
But it’s about more than just the numbers – both for Gupta and for Mahindra & Mahindra (M&M), which is Mahindra SA’s India-based holding company. “When M&M asked me to come to South Africa to take over as CEO of Mahindra SA, my brief was simple: Make South Africa a second home. And this applied both to the business and to me personally,” says Gupta, who moved to South Africa along with his extended family. When asked why South Africa in particular was earmarked to become Mahindra’s second home, Gupta is quick to mention the longstanding ties between the two countries. “South Africans and Indians have much in common – from our social and economic challenges, all the way through to liberation leaders such as Mahatma Gandhi and Nelson Mandela. My personal experience has been of a country that is warm and approachable, and I have made many good friends here. After all, a home is not a house; it’s not a matter of brick and mortar. A home is where you belong,” explains Gupta.
And Mahindra has indeed made South Africa as ‘homely’ as possible. Over the past few years, while many global automotive businesses were closing their South African assembly lines, the Mahindra assembly line has been going from strength to strength. In fact, local demand for Mahindra bakkies is projected to soon outstrip supply, and production will be expanded to help shorten waiting lists. Mahindra SA also boasts a local national parts warehouse and a network of over 70 dealers across the country. Acting from its second-home base, Mahindra has expanded into other countries in sub-Saharan Africa; it has a presence in Swaziland and Lesotho, and is currently exporting vehicles to Botswana, Zimbabwe, Zambia, Swaziland and Namibia.
AUTHENTICITY IS KEY
Mahindra SUVs and bakkies have had tremendous success in South Africa, and Gupta attributes this to the fact that South Africans and Mahindra place equal importance on ‘authenticity’. “I started my career with the biotechnology company Monsanto, where I worked with Indian farmers. Farmers are no-nonsense people, and for them the proof of the pudding is in the eating. I find that South Africans are similar; they want a brand they can trust to get the job done, and that has always been key for Mahindra. A customer’s experience of the vehicle must live up to expectations; it must deliver what it was designed and engineered for.”
But Mahindra takes authenticity beyond engineering. Gupta explains that when it comes to SUVs and bakkies, there is an important partnership between man and machine. “The machine must enable customers to reach what they aspire to, and for many people, that aspiration is to explore. The local market for off-road vehicles in large part consists of people who work long hours during the week; over the weekend, they want to be active and get away from it all. Our machines must enable the customer to do this – to explore the unknown, in partnership with a machine that always has your back.”
This partnership between man and machine is perhaps best illustrated in the 2022 launch of three special-edition bakkies that represent Mahindra’s brand positioning of ‘Unleash The Explorer In You’. The bakkies – called Karoo Dusk, Karoo Dawn and Karoo Storm – were inspired by a very special place in South Africa. “The Karoo is a semi-arid region characterised by extreme temperatures, cloudless skies, and a diversity of succulent plant species. It is close to the hearts of many South Africans, and the mere mention of the word conjures up the smell and feel of it. The design of each edition reflects a particular characteristic of the Karoo – the pitchblack of the Karoo dusk, the beiges and oranges of the Karoo dawn, and the black–grey–blue of the rare Karoo rainstorms,” explains Gupta.
But the ‘special’ in the special-edition Karoo bakkies extends beyond the aesthetics. “These are some of the most capable machines in the country, and they were engineered and designed for exploration. So we decided to put them to the test. We gathered a group of bakkie enthusiasts and asked them to do what they love most – explore. Over 21 days, the three-bakkie Karoo convey travelled over 8,500 km in three countries. Not only did the Karoo Dusk, Dawn and Storm surpass expectations from a performance perspective, but some of the drivers explained that their journey through rough, rugged and seldom-seen environments has been life-changing. That is a man–machine partnership. That is authenticity.”
BEYOND AUTOMOTIVE
TIn hearing Gupta talk about Mahindra – and especially the Karoo range – one would be forgiven for assuming that he is an automotive-sector man through and through. But his experience spans the biotechnology, logistics and automobile sectors, and he has worked in both product- and service-based businesses. He has a particular interest and penchant for marketing.
“For me, marketing is what links your business to the minds of your customers. To succeed, you need to really connect with your customers. You need to know how they think, how they consume, what they like and dislike, and whether they have a need for your product. There is a clear need for authentic SUVs and bakkies in South Africa, and that is what Mahindra is all about. And I believe that adding a local flavour – like we did in the specialedition Karoo range – shows just how committed and aligned we are with our local customers,” says Gupta.
Mahindra SA started operations a mere 18 years ago, but its performance over the past few years demonstrates that it has gained significant traction as a truthful, honest, household brand in South Africa. Nonetheless, Gupta does not rest on his laurels. “The world changes quickly and continually, and what worked yesterday will not necessarily work today. So you need to constantly reinvent your approach. Luckily, experimentation is the way at Mahindra, and as Mahindra SA we are grateful to have the full support of the M&M Board. We were given the freedom to decide our own path in South Africa, and the direction we chose was to really understand the heart of South Africans. And this extends beyond our customers – we are equally passionate about our employees, associates and channel partners.” Gupta believes that Mahindra SA’s success is the result of its largely South African team. He is adamant that decisions are made here, by the people who know the market best – and in this he has M&M’s backing. He is also passionate about the larger Mahindra network. “I firmly believe that what you do in business must lead to prosperity for all; that your business model must be one of win-win partnerships. As Mahindra SA gains traction as a homegrown brand, our employees, dealers and salespeople must be able to share in that. They need to realise increased personal prosperity as the brand prospers,” says Gupta.
MAHINDRA:
What began as a steel-trading venture in 1945, steadily turned into a global brand, spanning nations and industries. This is a story with an upward curve, narrating how an Indian company paved its way to become a global powerhouse.
Mahindra SA was established in 1996, bringing both our global name and expertise to South Africa. Since then, we have become the country’s fastest growing passenger vehicle and bakkie brand. Our success also led to the opening of our first local assembly plant in 2018.
We strive to continue to make our Mahindra mark, offering the people of South Africa world-class SUV, bakkie and commercial vehicles.
THE NEXT ADVENTURE
As a true innovator, Gupta believes that neither businesses nor their leaders should be allowed to stagnate. This means that there often comes a time when leaders should move on to new challenges, making way for fresh perspectives in the business. “For me, life is like a relay race in which our ultimate shared goal is to create growth and prosperity for all. Someday I will pass the Mahindra SA baton on to someone else to continue the journey, and in turn I will accept the baton for a new adventure of my own,” explains Gupta. When asked what advice he might have for his successor, Gupta’s response is simple. “Remain grounded, and do things in a sustainable and scalable way. The best success comes from sometimes-small increments of organic growth. And never forget that you are here to serve your customers. To gain customer loyalty, your brand should be seen as a member of the family; it must resonate with people’s joys and sorrows, with their challenges and aspirations. Your brand should represent home.”
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Duration and Risk Management
DISCLAIMER
The information contained in this document does not constitute advice by Liberty. Any legal, technical or product information contained in this document is subject to change from time to time. If there are any discrepancies between this document and the contractual terms and conditions, or where applicable, any fund rules, the contractual terms and conditions, or where applicable, the fund rules will prevail. Past performance cannot be relied on as an indication of future performance. Investment performance will depend on the growth in the underlying assets, which will be influenced by prevailing market conditions. Any recommendations made by an adviser or broker must take into consideration your specific needs and unique circumstances.
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Duration is an important concept describing the behaviour of bonds and measures the sensitivity of a bond’s price to interest rate changes where a longer duration indicates a higher sensitivity to interest rate fluctuations. Duration is a function of payment structure and maturity where, if two bonds are otherwise the same, a longer maturity bond will have a higher duration. If two bonds are the same in all other ways except coupon rate, the bond with the lower coupon will have a higher duration and a bond whose coupon is linked to interest rates will have a duration of zero.
By managing the duration of the portfolio, directional views can be taken on income instruments, whether this is to maximise the benefit of falling interest rates, to protect against rising interest rates or to take a position on interest rate spreads or volatility. To best capture the expectation on income instruments, the New Road BCI Income Fund-of-Funds (FoF) increased the duration of the overall portfolio. The success of this position can be seen in the following graph. The sharper increase seen in the second half of July in the New Road BCI Income FoF comes as a result of the higher portfolio duration.
Investment Growth
After the expectation played out, the New Road BCI Income FoF reduced portfolio duration to lock in on the gains and moved to a more protective position as seen in the following graph. The reduction in portfolio duration is achieved by reducing exposure to higher duration funds and increasing exposure to shorter duration funds.
BUSINESS ADVICES
Income Fund of Fund Duration
In addition to capturing the upside in capital value, the change in the profile of duration exposure also allows the fund to capture the high yields— 9.34% as of the start of August—the benefit of which would be passed on to the investor. Although the duration has now been reduced, this has come with very little decrease in the yield of the fund.
Income Fund of Funds Yield
The management of exposure to interest rate movements, as measured by duration, is an important factor in income fund management. By increasing duration to capture upswings and decreasing duration to protect against downswings, the return profile of the fund becomes asymmetrical in favour of the investor.
DISCLAIMER:
New Road Capital (Pty) Ltd, 2017/650486/07 and FSP number 50488, is an authorised discretionary financial services provider under the Financial Advisory and Intermediary Services Act (No. 37 of 2002). The information and any opinions displayed herein are of a general nature and do not constitute advice. New Road Capital takes all care to provide current and accurate information as at the date of publication but accepts no liability for errors, omissions or subsequent changes. Any references to data, assumptions, targets, benchmarks or examples are as indicators or illustrations only and are not fixed or guaranteed and clients should not assume any performance or guarantees apply unless such has been explicitly confirmed in writing. Past investment performance is not necessarily indicative of future performance. As clients remain responsible for the investment, product and counterparty risks of their decisions, they should consult with their advisors and independently assess and confirm all material information before taking any action. The NEW ROAD CAPITAL co-named funds (as defined in BN 778 of 2011) are registered under Boutique Collective Investments (RF) (Pty) Ltd (“BCI”), a registered Collective Investment Schemes Management Company in terms of the Collective Investment Schemes Control Act 45 of 2002, supervised by the Financial Sector Conduct Authority (‘FSCA’). New Road Capital (Pty) Ltd, is the FSCA approved and appointed investment manager of the co-named CIS funds. Boutique Collective Investments (RF) (Pty) Ltd (“BCI”) is a registered Manager of the Boutique Collective Investments Scheme, approved in terms of the Collective Investments Schemes Control Act, No. 45 of 2002 and is a full member of the Association for Savings and Investment SA. Collective Investment Schemes in securities are generally medium to long term investments. The value of participatory interests may go up or down and past performance is not necessarily an indication of future performance. The Manager does not guarantee the capital or the return of a portfolio. Collective Investments are traded at ruling prices and can engage in borrowing and scrip lending. A schedule of fees, charges and maximum commissions is available on request. BCI reserves the right to close the portfolio to new investors and reopen certain portfolios from time to time in order to manage them more efficiently. Additional information, including application forms, annual or quarterly reports can be obtained from BCI, free of charge. A fund of funds is a portfolio that invests in portfolios of collective investment schemes that levy their own charges, which could result in a higher fee structure. Income funds derive their income from interest-bearing instruments in accordance with Section 100(2) of the Act. The yield is a current yield and is calculated daily. Boutique Collective Investments (RF) Pty Ltd retains full legal responsibility for the third party named portfolio. Performance figures quoted for the portfolios are from Morningstar, as at the date of this document for a lump sum investment, using NAV-NAV with income reinvested and do not take any upfront manager’s charge into account. Income distributions are declared on the ex-dividend date. Actual investment performance will differ based on the initial fees charge applicable, the actual investment date, the date of reinvestment and dividend withholding tax. Annualised return is the weighted average compound growth rate over the period measured. Investments in foreign securities may include additional risks such as potential constraints on liquidity and repatriation of funds, macroeconomic risk, political risk, foreign exchange risk, tax risk, settlement risk as well as potential limitations on the availability of market information. Although reasonable steps have been taken to ensure the validity and accuracy of the information in this document, BCI does not accept any responsibility for any claim, damages, loss or expense, however it arises, out of or in connection with the information in this document, whether by a client, investor or intermediary. This document should not be seen as an offer to purchase any specific product and is not to be construed as advice or guidance in any form whatsoever. Investors are encouraged to obtain independent professional investment and taxation advice before investing with or in any of BCI/the Manager’s products.
