Insights from Three Headed Lion

Guar output in the key guar producing state in Rajasthan, India could fall as monsoon once again plays spoilsport. Rajasthan is the leading producer of guar contributing over 70 percent of guar produced in the world. Consequently, if the current trend continues, total guar production in India is likely to fall in 2014.

A delay in the arrival of the crucial monsoon rains pushed sowing from last week of June to third of week of July. The late arrival of monsoon also saw a decline in sowing area than what was originally planned in the region. Additionally, immediately after sowing was concluded the region received very heavy rains (flood like conditions in some areas). The erratic nature of monsoon is beginning to take its toll on the crop as there are reports of crop disease, and crop damage due to excessive rain.

“Owing to unfavorable weather conditions and a decline in the cultivation area we expect to see a fall in guar production this year.” Dr. D Kumar, a leading guar expert and a keen watcher of the guar industry in India.

The markets are beginning to react on the prospect of low guar output as guar spot prices have climbed 18% so far in August on NCDEX, the leading commodity exchange in India (Figure 1). There is also a corresponding jump of 17% in guar gum spot prices (Figure 2). Affects are also being seen in the futures market as October and November 2014 future prices for guar gum are up 21% and 22% respectively compared to the opening spot price for August 2014.

“Weather conditions over the course of next couple of months will be crucial in determining the final output of guar this season. It is critical to monitor ground level trends as the guar season unfolds. As in the past, THL will be closely watching developments in the guar market.” Says Javed Matin, Co-Founder, Three Headed Lion, Inc. (THL) and the chief author of the latest market guar gum report: 2014 Guar Gum Market Report.

Source: Field research of guar producing region by Three Headed Lion, Inc., a Houston, TX based leading research and marketing intelligence firm.

 About Three Headed Lion, Inc.: THL provides comprehensive and reliable market data, intelligence and risk management services for companies doing business in India, by connecting corporate level priorities to critical ground level market realities. THL uses a network of over 1,000 market intelligence and information providers (MIIPs) located in 640+ districts across the country, to source invaluable grass root level market data, intelligence and insight. The company has offices in Bangalore and Houston.



The recent market update from Business Standard reported that guar gum prices were up by Rs 260 to Rs 16,010 per 100 Kgs in future trading on July 23rd, 2014 as speculators enlarged positions, driven by strong export demand. “This trend is consistent with what we are currently seeing in the market place.” says Javed Matin, author of the recently published report 2014 Guar Gum Report: INDIA. The market for guar gum is for the first time in 2 years witnessing some degree of stress due to a projected drop in guar production coupled with a pick up in demand.


Three Headed Lion Inc. (THL) today announced the July 2014 update of its market report - 2014 Guar Gum Report: INDIA. The report provides an in-depth analysis of supply, demand and pricing trends as the new season for guar gets underway in India.

Unlike the 2012 and 2013 growing seasons, guar cultivation is expected to fall in 2014. Farmers in India are planning to include other competing crops into the mix. Consequently, the guar cultivation area is set to decline significantly compared to last year. Additionally, the prospect for a suboptimal monsoon season this year is also weighing in on the minds of the key stakeholders like farmers, traders and processors.

“The bullishness seen in the farmers in India for guar since 2012 is missing this time,” says Javed Matin, lead author of this report.

The full report - 2014 Guar Gum Report: INDIA is available at for immediate download.



Three Headed Lion Inc. (THL) today announced the release of its latest market report – 2014 Guar Gum Report: INDIA.

The report analyzes the latest state of the guar gum market and provides guidance on what to expect as the year unfolds.


Download the Guar Gum report here >>

The recent celebration of India’s potential as presented by McKinsey in Reimagining India: Unlocking the Potential of Asia’s Next Superpower is a timely reminder of the promise of India. Unfortunately, because the book consists of essays by various parties, it does not do justice to the enormity of the challenges we still face.

In fact, the Indian dilemma is captured quite well by Muhtar Kent, Chairman and CEO of Coca-Cola, “global companies are drawn to India by the promise of adventure and extraordinary opportunity it offers. However, in India, appearances can be deceiving. Even if you live and work there as an expat, you can never be entirely sure you understand the market completely. It is best to assume that you do not. If you come to India with some grand, predetermined strategy or master plan, prepare to be distracted, deterred, and even demoralized. Coca Cola has a built a very successful business in India. The key to this success has been learning to see the Indian market as it is, not as we wished it to be.”

It was for this very reason that we founded Three Headed Lion: to help businesses effectively navigate India’s challenges by understanding the true nature of the market – at the local level – across all India.

Despite the confusion and seeming chaos, businesses must not lose sight of the future. India, the world’s largest democracy, is a major economy with 1.2 billion consumers and one of the most attractive destinations for investment & business expansion. India’s growth impetus is summed up in Victor Hugo’s famous quote:“All the forces in the world are not so powerful as an idea whose time has come.”

So has India’s time come? Here’s what the key sectors look like:

  • Automobile: One of the largest and fastest growing.
  • Aviation: Third largest by 2020.
  • Consumer: Likely to be the world’s largest by 2030.
  • Infrastructure: Currently seeking USD 514 billion in investment.
  • Manufacturing: Expected to grow six-fold to USD 1 trillion, by 2025.
  • Pharmaceutical: Sixth largest market in the world by 2020.
  • Retail: One of the world’s top five markets.
  • Steel: Second-largest producer by 2015.
  • Foreign Direct Investment: USD 22.42 billion received during 2012-13.
  • PE and VC Investment: Increased by more than 46 per cent in the first half of FY14, raising USD 609.39 million through 51 deals.

Of course,  realizing the true potential of your investments in India may not be an easy task. Despite the best market strategies and people, the complex nature of India keeps success elusive for many global businesses and investors.

The following factors make it very difficult for companies, investors and institutions to understand the hidden risks in the Indian economy; thus hurting their ability to take advantage of India’s tremendous market potential:

  • Diversity: Further compounding complexity is India’s diversity. India is a classic case of countries within a country model. With 28 states and 7 union territories, 22 official languages and several more dialects, multi-culture, multi-religious, and multi-cuisine, India is a truly diverse country. Global businesses must recognize that doing business in India is different from doing business in any developed market. There are distinct differences in terms of business practices as well as consumer preferences.
  • India’s Opaque Triangle: Global companies, investors and institutions looking to participate in India have generally found that the three key elements of success – Market Potential, Enabling Policies and Ground Realities – seldom align in India, making the market opaque. This misalignment between the trinity of Market Potential, Policy and Reality is India’s Opaque Triangle.
  • Lack of Ground-Level Intelligence and Data: Another critical complexity driver is the lack of ground-level intelligence and detailed micro-level data on sectors, consumers and competition. This is a major issue in the ability to decipher and understand significant differences between what may appear at the macro level and reality on the ground. Additionally, global companies are used to leveraging quality data for planning as well operational purposes find it very hard to plan for India.
  • Governance Conflict: Last but by no means any less important is the constant tension between central and state governments that are led by different political outfits, and with conflicting political ideologies.

As part of our advisory blueprint, we follow a process that brings clarity to decision-making:

We help you ask the right questions as part of our Executive Journey to India workshops:

  1. Do you have complete market visibility, from perceived opportunity to ground level realities?
  2. Do you have access to ongoing actionable data and intelligence for strategic planning and ongoing execution?
    a)  Do you know where your market opportunity is?
    b)  Do you know who and where your customer is?
    c)   Do you know who you should and should not partner with?
    d)  Do you know what kind of employees you need and how to find and retain them?
  3. Have you clearly outlined your supply chain, including all stakeholders? Do you know if your supply chain is exposed to manipulation? If yes, what is your plan to mitigate the risk from manipulation?
  4. Do you know what kind of market forces act on your business? Do you have a plan to manage them?
  5. Do you foresee threat to your company’s reputation? If yes, what actions are required to protect it?
  6. Does your global management understand the complexity of India? Are they equipped to manage it?

Learning to succeed in India is a core-competence for future global executives. And then there’s the branding integrity issue as well.

Learn more about us, and let us know how we can help >>

P.S. Best wishes to all on this Republic Day!

India has rapidly emerged as one of the largest economies in the world, but it is also one of the most complex. Now, led by Prime Minister Manmohan Singh’s insistence that “good economics is good politics,” India has announced a new wave of reforms, seen by many as the most significant step since the ground-breaking “opening of India” in July 1991. The reforms include changes to retail, airlines, broadcast and power sectors.

Read More

See Press Release

The following interview took place in Houston Texas on the 6th of May, 2013.  Javed Matin is the co-founder of  Three Headed Lion, a leading intelligence advisory company focused on the Indian sub-continent. Their latest update on the Guar Gum Industry:India (2013) was released at the end of April.

Can you tell us about the current state of the Guar Gum industry cycle in India?

The current cycle is being seen by many industry analysts as a turning point for the Guar Gum industry in India. We feel that the Guar Gum fever has subsided, although the market is far from transparent. The  shakeout continues, with smaller vendors and farmers bearing the brunt of the disappointment.  In our latest report, we diagrammed the state of the industry based on over 700 interviews in the field. It looks to be following a fairly rational model, after all the excitement of the previous year, when we saw the unprecedented disruption caused by skyrocketing prices.

What caused this drop in prices?

It is a supply-demand situation. There is ample availability of Guar seeds in the market to meet current demand for Guar Gum. Demand on the other hand has remained sluggish so far owing to higher inventory levels at key Oil & Gas users particularly in North America at the start of 2013 and a slowdown in fracking activity.

What else does your report cover?

Our unique on the ground presence across the Guar-producing states in India allows us to conduct ongoing exhaustive field research on this topic. For this report, our researchers interacted with a large number of stakeholders in the industry (farmers, traders, government officials, trade association members, etc.) and gathered their inputs and sentiments to construct the most comprehensive current state of the Guar industry in India. We cover a lot of information and what’ s more, it’s timely. We reveal critical data and analysis on guar seed and guar gum production, price trends, demand, supply, we give you a dashboard of key market fundamentals, we identify current risks and mitigation actions required. and we deliver a comprehensive assessment of each stage of the guar gum supply chain to understand current state and risks.

We think that our report is the most important tool available on the market  for business planners, investors and purchasing departments.

So, what should buyers be doing?

While prices look stable at the moment, the market is going through a critical phase as guar seed stock changes hands from farmers to local traders and processors. We expect some upward movement in prices as demand slowly picks up and as availability of seeds reduces in the open market due to arrival of winter crops.

As the year progresses, buyers must remain vigilant of a repeat of last year’s manipulation by vested interests. The absence of strong regulatory enforcement can aid these players to play the market again. Although, there are signs that the government has taken note of cartelization of Guar industry and is contemplating action to prevent it. Buyer should closely monitor developments on the ground to better predict pricing and supply trends as the 2013 season unfolds.

How does this impact the planning process for Guar Gum buyers? Is there a sense that market stabilization is now the norm, or are we in for more shocks?

Despite current stability in the market, the high degree of complexity and opaqueness of the guar gum supply chain in India continues to pose significant challenge for effective planning. The lack of transparency in the market, weak regulatory enforcement and ability of vested interest to play the market will keep this guar gum industry in India exposed to risks. Buyers should ask the right questions:

  • Will the nexus between influential traders and processors once again influence guar gum prices this year?
  • Will the Indian regulator, Future Markets Commission (FMC) allow futures trading of guar on Indian commodity exchange?
  • If Guar gets relisted on the commodities exchange, will FMC get the mandate and ability to check insider trading, cartelization and price manipulation?
  • Is the government contemplating policy changes for Guar Gum?
  • Are there any socio-political-security trends that have the potential to impact the movement of freight from Guar Gum processors to the export ports in India?
  • What happens if export-ports encounter labor issues or greater capacity constraints or a major security breach takes place?
  • Will the farmers continue growing Guar over other competing crops?

The answers to these questions will help companies manage their Guar Gum activities and minimize the inherent risks in the industry.  We encourage all interested parties to delve deeper using our timely report on the state of the Guar Gum industry in India.

As growth imperatives drive businesses to explore opportunities in India – the world’s largest democracy – mixed signals, inconsistent policy, and opaque business practices, create challenges for even the most seasoned multinationals. Navigating these complexities requires an intimate understanding of the culture, business climate, politics, and customer segments.

The Executive Journey is a customized strategic immersion program for MNC executives and future global managers. Based on the industry and your strategic requirements, we design a three-section program as depicted below:

Executive Journey: India

 Unlike traditional MBA Executive education programs, we work with your senior executives to develop the right strategy for your Indian operations – identifying opportunities, potential partners, and alerting you to the risks – political and local – as part of our Go-to-India services.

Contact us to learn more >>

The development of you Go-to-India strategy cannot be left to the analysts in the Home Office.  This is the first and most crucial point of consideration; get this wrong, and you will inevitably fail.

Second, your India strategy, by definition will be a state-by-state strategy. What works in Bengal does not work in Gujarat and vice-versa – and that is an understatement.

Third, treat your Indian initiatives as if they are innovation projects. The key early on is to focus not on detailed financial estimates–which will always guide companies toward the markets most hostile to innovation–but on how well the innovation fits the pattern of success. It’s also crucial to encourage flexibility: Companies must be willing to kill projects that are going nowhere, exempt innovations from standard development processes, and avoid burdening project teams with extra financing, which can keep them heading in the wrong direction.

Fourth, make sure you have a brand integrity process in place, before you start dealing with your partners and suppliers. Supply chain risk management must be established core competence of your overall strategy.

More details shortly, stay tuned.