Gulshan Kumar: From obscure fruit-juice seller to king of music

His was the textbook success story. An obscure fruit-juice seller in Delhi's Daryaganj who went on to become the Midas of music and the kingmaker for a new generation of singers. Yet, Gulshan Kumar did much else than make music and movies.

He manufactured cassettes, agarbattis, bottled water, detergents and even ceiling fans. A biscuit venture was on the anvil, and his real estate business was getting serious. Kumar spawned a Rs 350 crore empire which was awesome and diverse but all in the family.

The flagship Super Cassettes Industries (SCI), the musical hardware and software, TV sets and electrical goods conglomerate is a public limited company in name. Its only other directors, apart from the nominee of a financial institution, are Kumar's friends Ved Chanana and Sunil Wadhwani.

As for the surviving family directors, father Chandra Bhan, at 75, just manages to sign his name, while son Bhushan, 23, began learning the ropes from him only a few months ago. However, Bhushan is said to have been asserting himself in the recent past, even trying to push to the periphery Kumar's "friend" Anuradha Paudwal, once quite involved in the business. The shares are closely held by the family, which now has to wend its way through a daunting haze of businesses.

SCI, with a group turnover of Rs 350 crore, has frenetically expanded over the past decade, acquiring real estate, multiplying its audio and video tape duplication capacities, investing in films, and making TV sets. The 275-acre plant at Surajpur in Greater Noida is alone worth over Rs 300 crore.

Its audio tape duplication capacity of 7.5 million a month accounts for three-quarters of the total market. The video-cassettes division churns out two million pre-recorded videotapes, a third of the market. With an income of Rs 150 crore from the sale of prerecorded music, SCI's declared share of the market is no more than a sixth.

But industry sources credit it with more than a half of the total music cassettes sold, at a retail price which is half that of the other brands, and a whole-sale price which is often a quarter. Says S. Bannerjee, general manager of SCI's music division: "We are certainly the most important player in the music market."

The success of Kumar's decades long forays into film music rests on the masterful exploitation of a tricky clause, Section 52(1)(J), in the Copyright Act which says that while copying an earlier work of music, there is no copyright infringement if a letter of intention is given to the copyright holder.

Latching on to this ambiguity, Kumar went on a binge of 'cover versions', in which Paudwal sang Lata Mangeshkar's numbers, or Kumar Sanu, his discovery, imitated original Kishore Kumar songs to the last yodel. The bhajan and remix packages often spilled on to TV screens. Kumar himself had become an almost permanent fixture on music channel ATN.

Wafted by a surge in the 'two-in-one' revolution of the '80s, the audio cassettes, selling at a fraction of the price of big labels such as HMV, reached the urban lower middle class and rural homes. It forced the organised sector, led by Gramophone Company of India, which owns HMV, and Music India, to cut prices and spend a fortune on lawsuits.

Only a couple of days before Kumar's death, Music India issued an advertisement warning buyers against the "look-alike" and "passing off " version of one of its Anup Jalota records, Bhajan Sandhya. Kumar had not only convinced Jalota to sing the same songs for him but had used the same title on the version under his label.

Kumar's buccaneering ways succeeded because of his unique style of managing his 500 cassette dealers and countless sub-dealers and vendors, a style which he may have learnt from the pavement trade of Daryaganj. The network operated on low margin but high volume and, as a Delhi pavement seller of T-Series tapes says in admiration, "absence of paper-work". Even Bannerjee admits that the trade sustained on "trust" and "Gulshanji had an unerring sense of whom to trust".

Of late, however, his proven turf of remix recordings was getting overcrowded with the entry of fellow-buccaneers like Ganesh Jain's Venus, the Thauranis' TIPS, and cable-video czar Dhirubhai Shah's Time Video. With the organised sector also slashing prices by lowering retail costs, Kumar was forced to launch a diversification drive.

He hived off the tape-coating plant of SCI into a separate company, Tony Electronics, put under the charge of brother Darshan Kumar. The detergent division was also hived off as Gopal Soap Industries, under the care of another brother Gopal Krishna. Kumar even started a company that made T-Series brand agarbatti and put its operation under a family partnership firm Rajni Industries.

However, the flagship company SCI was simultaneously moving into a variety of operations - making black-and-white TV sets, audio and CD players, Concord brand ceiling fans, CDs, and a mineral-water project at Rishikesh which promised to bottle only purified Ganga water under the Ganga brand.

Kumar was also developing a housing project in Surajpur by relocating some of his plants. And, apparently to curry favour with state Chief Minister Mayawati, he had his in-house filmmaker Uday Shankar Pani directing two politically expedient works, a one-hour documentary called Mayawati, Dalit Singhani and another on the Ambedkar Gram Vikas Yojana.

The portfolio was too large by any reckoning. The delivery cost of mineral water from Rishikesh was proving too high. Concord was offering too large a margin to distributors to be profitable. And after a fall in the import duty of audio and TV components, the sale of T-Series TV and audio sets became sticky even at the lower end of the market. It was only the music business that, despite the odds, brought to Kumar all of his Rs 20 crore net profit last year.

As competition closed in, Kumar gradually withdrew into the shell of divine worship. He announced a grandiose project to construct 12 Shiv temples, the first of which, an 85-foot reinforced concrete idol, is now under construction at the SCI headquarters.

A full-fledged temple was built in the company's Mumbai office. As his puja hours lengthened, Kumar began to keep important visitors, including his bankers, waiting. He became churlish, firing about a dozen of his executives in the past year, delaying artistes' payments and quibbling over contracts. Ironically, it was Kumar's favourite temple of Shiv-the destroyer-where the last call came.