Does Your Company Have an India Strategy?

Multinationals that don’t have a plan for building subsidiaries in the country risk missing out on one of the most promising market opportunities in the world today.

by

and

Aman Rajeev Kulkarni

by

and

Aman Rajeev Kulkarni

June 27, 2023, Updated September 26, 2023

HBR Staff/anand purohit/Getty Images

Summary.

The price-to-book ratios of Indian subsidiaries of multinationals far exceeds those of their parent companies. That suggests the subsidiaries have better growth prospects, which makes sense given India’s rapidly growing middle class. At this point, any multinational without an India strategy is missing out on a major opportunity for growth and profitability. But tailoring your strategy for India requires customizing your products and services and tapping into the “India stack.”

At the end of financial year 2022, the price-to-book (P/B) ratio for the European consumer products giant Unilever PLC stood at six. The same number for its subsidiary in India, Hindustan Unilever, was twice that, at twelve. This difference is not because the Indian subsidiary is a young or small company — on the contrary, the Indian subsidiary is a 90-year-old company with a market cap of $76 billion. Nor is this an isolated instance.

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Vijay Govindarajan is the Coxe Distinguished Professor at Dartmouth College’s Tuck School of Business, an executive fellow at Harvard Business School, and faculty partner at the Silicon Valley incubator Mach 49. He is a New York Times and Wall Street Journal bestselling author. His latest book is Fusion Strategy: How Real-Time Data and AI Will Power the Industrial Future . His Harvard Business Review articles “Engineering Reverse Innovations” and “Stop the Innovation Wars” won McKinsey Awards for best article published in HBR. His HBR articles “How GE Is Disrupting Itself” and “The CEO’s Role in Business Model Reinvention” are HBR all-time top-50 bestsellers. Follow him on LinkedIn.
vgovindarajan
Rajendra Srivastava is the Novartis Professor of Marketing Strategy and Innovation at the Indian School of Business. He has served Dean at ISB. He has also served as Provost at Singapore Management University and as Senior Associate Dean at Emory University and The University of Texas at Austin. Srivastava is a strong proponent for inter-disciplinary research and collaboration between industry, government, and academia. He has worked with over 50 MNCs across more than 50 countries and 5 continents. Reach him at LinkedIn.
Anup Srivastava holds Canada Research Chair in Accounting, Decision Making, and Capital Markets and is a full professor at Haskayne School of Business, University of Calgary. In a series of HBR articles, he examines the management implications of digital disruption. He specializes in the valuation and financial reporting challenges of digital companies. Follow Anup on LinkedIn.
Aman Rajeev Kulkarni works as a Research Associate at the Indian School of Business, following his graduation from ESSEC Business School with a Masters in Finance. His work is primarily focused on bridging the research gap among Finance, Marketing & Accounting, promoting financial inclusion for MSMEs and leveraging business-innovation thinking to address corporate challenges. Reach him at LinkedIn.

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Accelerate your career with Harvard ManageMentor®. HBR Learning’s online leadership training helps you hone your skills with courses like Global Collaboration. Earn badges to share on LinkedIn and your resume. Access more than 40 courses trusted by Fortune 500 companies.

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Does Your Company Have an India Strategy?

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