Hindustan Times (Jalandhar)

Ramdev says Patan­jali to be a not­for­profit en­tity

FU­TURE PLANS We’ll not list Patan­jali on the stock ex­changes: Yoga guru

- Sounak Mi­tra sounak.m@livemint.com

NEW DELHI: Yoga guru-turned busi­ness man Baba Ram dev said Patan­jali Ayurved Ltd will be turned into a “non-profit” en­tity as it seeks to plough back earn­ings from its busi­nesses into char­ity. “We will not list Patan­jali on the stock ex­changes. We will list Patan­jali in peo­ple’s hearts. We are trans­form­ing Patan­jali into a non-profit or­ga­ni­za­tion,” Ramdev said on the side­lines of a press con­fer­ence. Patan­jali has, since its in­cep­tion, used all prof­its gen­er­ated from busi­ness for char­ity, he added.

Patan­jali Ayurved is a pri­vately held com­pany that is 98.6% owned by Ramdev’s close aide Acharya Balkr­ishna, who was ranked the 19th rich­est In­dian by Forbes in 2017 with an es­ti­mated net worth of $7.3 bil­lion. Ramdev does not di­rectly own shares in the com­pany.

As a first step, Ramdev has set up a char­i­ta­ble or­ga­ni­za­tion— Patan­jali Seva Trust—which will be the sole hold­ing en­tity for all com­pa­nies that are part of the Patan­jali Group, ac­cord­ing to a group ex­ec­u­tive who did not want to be named. There are a few dozen reg­is­tered firms in the Patan­jali Group.

While Patan­jali Ayurved man­u­fac­tures and sells a host of con­sumer pack­aged goods—from pulses to ghee, bis­cuits to sham­poo, juices to anti-age­ing creams—the group has in­ter­ests in a bunch of other busi­nesses, in­clud­ing ed­u­ca­tional in­sti­tutes, ayurvedic medicines and hos­pi­tals, to name a few. The com­pany has also ex­pressed in­ter­est in en­ter­ing new ar­eas such as in­fra­struc­ture, so­lar power and ap­parel, among oth­ers.

There could be sev­eral rea­sons why Ramdev has set up Patan­jali Seva Trust as the hold­ing en­tity. “It could be an ex­er­cise to avoid in­her­i­tance tax that the gov­ern­ment may im­pose in the fu­ture. A trust as a hold­ing en­tity en­sures suc­ces­sion of the firm’s as­sets, wealth preser­va­tion in per­pe­tu­ity,” said Rad­hika Jain, part­ner, Grant Thorn­ton In­dia Llp.

Pranav Sayta, tax part­ner, EY, said just turn­ing Patan­jali Ayurved into a trust will not by it­self give much of a tax ad­van­tage. “But if in­come gen­er­ated from com­mer­cial op­er­a­tions is used in char­i­ta­ble causes as a set ob­jec­tive of the en­tity, the tax ad­van­tage is huge,” he said.

Ac­cord­ing to the Patan­jali ex­ec­u­tive cited above, Ramdev has writ­ten a ‘Will’ for Patan­jali group com­pa­nies en­sur­ing suc­ces­sion. “Own­er­ship of Patan­jali can never be trans­ferred to any­one other than a ‘sanyasi’ (re­nun­ci­ate). The Trust struc­ture is to en­sure fu­ture of the busi­ness em­pire. Af­ter the demise of Baba Ramdev and Acharya Balkr­ishna, the com­pany will be owned and run by sanya­sis only,” the ex­ec­u­tive said.

In a state­ment, Ramdev said Patan­jali’s main aim be­hind its ac­tiv­i­ties was to do char­ity works of “over ₹ 1 lakh crore” in ar­eas of ed­u­ca­tion, health, yoga, ayurved, re­search, gau-seva (cow wel­fare) and ser­vices to the com­mon man. “We have un­der­taken char­ity works to the tune of over ₹ 11,000 crore,” the state­ment added.

To be sure, the profit that Patan­jali Ayurved has gen­er­ated from its busi­ness so far is likely to be far less. In the year ended 31 March 2017, Patan­jali dou­bled its rev­enue to ₹10,561 crore from ₹5,000 crore in the pre­vi­ous year. Patan­jali’s me­te­oric rise was in the last two to three years. Its rev­enue jumped from ₹446 crore in 2011-12 to ₹2,006 crore in 2014-15.

 ?? MINT/FILE ?? Ramdev has set up a char­i­ta­ble or­gan­i­sa­tion, which will be the sole hold­ing en­tity for all Patan­jali Group com­pa­nies
MINT/FILE Ramdev has set up a char­i­ta­ble or­gan­i­sa­tion, which will be the sole hold­ing en­tity for all Patan­jali Group com­pa­nies

Newspapers in English

Newspapers from India