Cementing A Legacy

Third-generation Puneet Dalmia earned the go-ahead to expand in a consolidating Indian sector.

- Anuradha Raghunathan

In 1999—two years after joining his family cement business in Delhi, Puneet Dalmia proposed a $140 million expansion plan—with all the gusto of a management grad with a gold medal from the premier Indian Institute of Management in Bangalore.

His father, Yadu Hari Dalmia, who was running the cement outfit, didn’t mince words. “He told me, ‘You have no credibility. I cannot put so much money behind you,’ ” recalls Puneet, who also has an engineering degree from the Indian Institute of Technology in Delhi.

Instead, Papa Dalmia gave his son $500,000 of his own money and asked him to prove his mettle. Puneet cofounded a startup with a friend from IIT—getting funding from domestic private equity major ChrysCapital. The startup was a job search site, which he ran for a few years and then sold to global jobs outfit Monster.com for $9 million.

In 2004, Puneet rejoined the Dalmia Bharat Group—with interests in cement, sugar, power and refractories—and revived the proposal for cement expansion. “We had to build scale,” says Puneet, now 46. “We were not even relevant in our businesses.”

This time around, his father backed him, and he spearheaded two rounds of expansions for $500 million. Over the course of the next 14 years, the cement company grew from 1.2 million tons’ capacity to 25 million tons—both through expansions and acquisitions—even as revenues rose from $60 million to $1.3 billion. This catapulted it to the No. 4 spot in the Indian cement industry.

In 2010 he roped in private equity giant KKR to invest in the business. Under KKR’s tutelage the cement business went in for rapid expansion—taking over companies in eastern and northeastern India. (KKR exited in 2017 after nearly quadrupling its investment.)