M. Karunakara Reddy, CMD, Smaat India There are those who just dream and those who pursue a path inspired by an innate belief in achieving their objectives. One such pursuer is M. Karunakara Reddy, CMD, Smaat India, who tells The Dollar Business how his humble beginnings have only made his resolve to make it big, stronger

Satyapal Menon | @TheDollarBiz 

TDB: You were recently in news for achieving, what many would have considered an impossible task, i.e., ensuring flood-ravaged Kashmir had access to purified drinking water. What made this possible? 

KR: As you must be aware, the aftermath of floods leave a trail of carcasses and streams of contamination. During the floods in Kashmir, I approached the government for permission to supply purified water to the people of flood-ravaged regions. At that point in time, each litre of bottled water was costing the government Rs.125, including transportation and air-dropping costs. I told them I could transport my mobile water treatment plant to Kashmir for this purpose and supply purified water at 25 paise-a-litre. Initially, they were sceptical, but later agreed when I explained the technology behind the mobile water treatment plant developed by us. With the support of NDRF, we airlifted 54 dissembled plants, each with 20,000 liters per day capacity, from Hyderabad in two phases and re-assembled them in Kashmir. 

TDB: Not many with a rural background, like that of yours, make a mark with their own product line.  The journey must have been an arduous one, isn’t it? 

KR: Initially, it was not without vicissitudes, because being from a lower middle class farming family, I could barely manage to go through my schooling. Moreover, since there was no electricity, I had to study under kerosene lamps. But then, I always had the burning desire to come out of my rural confines and make it big. I worked part time to support both my education and my parents. My passion for business made me pursue higher studies. Once, while doing a project, I got the opportunity to enter a multinational soft drink company and got involved in their marketing activities. The company absorbed me later and posted me in Hyderabad.  

TDB: How much did the experience of working in a multinational help you?

KR: While working in the MNC as an area manager, I was yearning for a change from the carbonated water division and sought the same from the Executive Director of the company. It was then that he mentioned that the company was going to set up its first pure water plant in Nagpur and asked me if I would be interested in working there. I grabbed the opportunity with both hands, since this was an area I was always passionate about. Coming from a water-scarce district, I was always contemplating making pure water accessible in rural areas. I joined the water plant division and the experience there proved to be a life-changer. I was around 22 years old then and the youngest area manager in the company. I gained first-hand experience in technologies involved in water purification, apart from in-depth knowledge about the market. It was at this juncture that I started nursing ideas of starting a unit of my own.  

TDB: When did you start your enterprise? Did you begin manufacturing water purifying plants from the word go?

KR: We set up Smaat Aqua in 1998 and initially, imported water treatment plants and sold them in the domestic market. Apart from sales, we were also involved in operating and maintaining the machinery. Those days, we operated on thin margins, with a view to increase our customer base.

TDB: Setting up a company requires huge capital. How did you manage the investment?

KR: I started the company with only Rs.35,000. My R&D facility was located in a garage. My brains and skills were my investment. Smaat started without even the basic infrastructure but right now, we have the best infrastructure. We have our own 1,00,000 square feet facility. We have very good pre-qualification experience. We are financially strong. Today, we have more than 1,000 people on board and our turnover in FY2014 was Rs.185 crore.

TDB: Can you explain the features of your company’s product-line?

KR: Smaat India has a unique range of water solution plants. Our product-line comprises reverse osmosis membrane filtration, micro filtration, nano filtration, ozone filtration, mobile water treatment, sewage treatment, sea water de-salination, effluent treatment and a host of other units. All these products have been developed with our own innovative technologies. Smaat mobile water treatment plant was the first-of-its-kind and was specifically designed to cater to drinking water requirements in flood affected areas.

TDB: When and how did your forays into foreign markets begin?

KR: For the first four years, we were focusing only on the domestic segment. In terms of exports, we started off with an order from Saudi Arabia where later, we established a strong footing. We began with a very small $3,800 project. But within a year, our export orders increased to $1,50,000-$2,00,000 as we started getting orders from big companies like Saudi Oger Limited and Saudi Binladin Group. Our export-to-domestic sales ratio is 80-20. Our USP was low price and our state-of-the-art technology. Our prices being 50% below those offered by foreign sellers gave us the edge.

TDB: So, is Saudi Arabia your only export market?

KR: After Saudi Arabia, we started getting orders from different parts of the world. We get technology support from Metito – a water treatment solutions major. Metito also redirects small orders to our company. Through them, we have bagged projects in Bangladesh. Apart from this, our company has 3.5 million customers, spread across 33 countries, including Afghanistan, Yemen, Dubai, Tunisia, Morocco, Algeria, Australia, US and New Zealand.

TDB: What is the secret of your success and what are your long-term goals?

KR: We are the first ISO 9001:2008 & ISO 14001:2004 certified company to introduce eco-friendly, non-chemical technology. Smaat products are NSF, CE, WQA, FDA and IWWA certified. We have bagged over 120 international and national awards. My focus on social business rather than commercial business have proved to be fruitful.