What Credit Crunch? GE wants to buy in India

Posted by: David Rocks on October 12, 2008

Even as the financial world seems to be crumbling and General Electric’s profits are headed south, the company may be looking for acquisitions in India. The other day my colleague Mehul Srivastava and I met with GE India boss Tejpreet Chopra. He sketched out an ambitious plan to boost the company’s revenues in the country to $8 billion by 2010 or 2011, from $2.6 billion today. “There will be some element of acquisitions in meeting our (sales) targets,” Chopra said.

Why now? Obviously, the global credit crunch would make financing a challenge, but Chopra says the spectacular fall of Indian stock prices should help bring once-lofty valuations down to earth. “Now that the market has cooled off, this would be a great time for us to start looking for partnerships and acquisitions in our country,” he said.

Chopra said he'd be interested in just about anything that would fit with the range of products GE is involved in: Energy, oil and gas, healthcare, financial services, transportation. One wrinkle is that a lot of the best Indian companies are family-owned, so there’s no real pressure for them to get out—in fact, in a falling market there’s less incentive for families to sell. Chopra, though, says there may still be some opportunities. “There is a slight shift in mindset of some family-run businesses,” he said, “while in previous years there wasn’t much chance at all.”

While Chopra says he’s always talking with potential partners, no deal is imminent. But he’s confident that once he comes up with a candidate, GE’s board will give it strong consideration. “They’ll look at it very seriously,” Chopra says. “India is absolutely one of the most strategic markets for the company…How do you ignore a market of a billion people?”