Thermax: Balancing Growth and Sustainability

The case describes the growth journey of an Indian multinational engineering conglomerate, Thermax Limited, over its last five and a half decades of existence. Thermax, a family business spanning three generations, provided integrated solutions in clean energy, air, and water. The family's business philosophy encouraged the adoption of sustainable and green operations. They pursued responsible growth. This involved first meeting the energy requirements of energy-starved markets (such as India and Africa) and then investing in sustainable energy business practices. The company focused on sustainable medium-term profitability and not on short-term increases in market capitalization. Moreover, it had conservatively concentrated model for business growth. The present MD and CEO, Ashish Bhandari, is given the mandate of responsibly managing and accelerating growth by increasing the annual turnover threefold from INR 60 billion to INR 185 billion by 2030. This significant growth posed challenges such as managing the growth responsibly, financing the required capex, and managing the human resources requirements. The case concludes with Bhandari facing some tough decisions to make about striking a balance between business growth aspirations, institutional investors' future expectations, and the family business legacy of social consciousness.

Learning Objectives

1. To comprehend the global energy transition trends, and the regulatory norms governing emission protocols.
2. To illustrate the difficulties faced by professional managers in the successful execution of a fast-growth strategy in a tradition-driven family business.