Doshion: Flush with Funds

Image: Pravin indrekar for Forbes India

Ashit Doshi, MD, Doshion

Water, water everywhere not a drop to drink. India has 17 percent of the world’s population and perhaps 4 percent of world’s water. We hear of villagers walking kilometres to fetch water and we hear of urban areas where water is supplied for just a few hours. Doshion is one of the few companies—the publicly-listed VA Tech Wabag is another—which has the technology and the business model to cater to a variety of water needs like helping industries reuse water or developing projects to allow municipalities supply clean drinking water. Doshion closed last year with sales of Rs 587.25 crore and a net profit of Rs 25.20 crore, while its FY2011 sales were Rs 391.67 crore and net profit was Rs 14.53 crore.

The man behind it
Ashit Doshi, 46, is the man who has made this 35-year-old company competitive. “He is an assertive leader with a high degree of passion. He doesn’t want to wait for the market to develop but wants to create the market,” says Shivani Bhasin Sachdeva, founder, Indian Alternatives, who invested in Doshion five years ago when she was in IDFC Private Equity. For instance, Doshion has picked up a huge challenge in
developing a brand new water distribution system for Shivpuri town in Madhya Pradesh and tied up with foreign partners like Veolia, Dow and Asahi for the latest water treatment technologies.

Why it is a gem
There are a variety of companies trying to attack the $30 billion Indian water supply market but very few are able to make an integrated approach to solving a customer’s water problem. In that sense, Doshion is much like an electricity company that will set up a plant, create the distribution infrastructure and then have the billing system in place.

Two things set Doshion apart. First, it has access to almost all major water treatment technologies that allow it to treat water from almost all possible sources such that the treated water becomes as good as new. Its technology partnership with Veolia helps it do that. And it has the competence to put it all together to develop one-stop solutions for its clients. Second, its has the ability to put its skin in the game. It sets up the water treatment plant for its industrial customers or municipal corporations, runs it and then lets them pay it on a usage basis. “We know how to set up and manage these plants optimally. We are able to deliver the water at a 20-30 percent cheaper price than if they were to do it themselves,” says Ashit Doshi, CEO, Doshion.

Why it was hidden
Ashit Doshi runs a fairly quiet ship and being based in Ahmedabad helps. Besides, unlike roads, ports or power, the water sector hasn’t seen the sort of reforms that would put a company like Doshion in the limelight. Doshion  is focussed on the industrial and urban water supply market. “I think they are exceptionally strong in the industrial water treatment market which is not something that everyone notices,” says Bhasin Sachdeva.

Risks and Challenges
The biggest headwind it faces is the lack of regulatory clarity on water. The Centre gave road development a fillip when it created the National Highway Authority of India. There is a chance for India to improve its water supply infrastructure. Treatment and reuse of water is one huge step. “But a lack of clear-cut policy direction is slowing down the opportunity,” says Doshi.