Star Engineering Company Ltd
In this case study there are basically 5 product groups,
Product A - Transformer Coils
Product B - Cable Jointing Kits, Jelly Filled Cables
Product C - Electric point Machines
Product D - Steel Forgings
Product E - Switch Mode Power Supply (SMPS)
Market share and Sales of each Product:
Transformer coil: Market share 20 Percent and growing at an average of 20 percent per annum. This product is sold to manufactures of equipment i.e. Telecom Exchange and requires Rs 2 crore investment
Cable Jointing Kits, Jelly Filled Cables: Market share decreased to about 20 percent and is being substituted by fiber optic cables and other type of joints. Still a market leader and contributes a lion’s share in total company revenue.
Electric point Machines: Market share about 40 percent and growth rate at about 7 to 8 percent per annum and this product is in high demand as it is required by railways and also for export. Currently requires about 2.5 crores.
Steel Forgings: Market share of 5 percent and growth rate of about 8 to 10 percent per annum. This product is required by diverse market and is currently a loss making unit and requires about 1.50 crores for ISO certification.
Switch Mode Power Supply (SMPS): Market share of about 6 percent and growth rate 20 percent per annum and this is relatively new product launched just 6 months back. Required by electronic industries has good potential for being market leader and requires 5 crores.
Based on the analysis
Product A - Transformer Coils is in growth phase.
Product B - Cable Jointing Kits, Jelly Filled Cables is declining phase.
Product C - Electric point Machines is in growth phase.
Product D - Steel Forgings is in kind of maturity stage.
Product E - Switch Mode Power Supply (SMPS) is in growth stage.
Total amount required based on the units requirement is about 11 crores but the company can only arrange 5 crores,
My recommendation to Mr. Anant Kumar would be to invest in,
Product A - Transformer Coils
Product B - Cable Jointing Kits, Jelly Filled Cables
Product C - Electric point Machines
Product D - Steel Forgings
Product E - Switch Mode Power Supply (SMPS)
Market share and Sales of each Product:
Transformer coil: Market share 20 Percent and growing at an average of 20 percent per annum. This product is sold to manufactures of equipment i.e. Telecom Exchange and requires Rs 2 crore investment
Cable Jointing Kits, Jelly Filled Cables: Market share decreased to about 20 percent and is being substituted by fiber optic cables and other type of joints. Still a market leader and contributes a lion’s share in total company revenue.
Electric point Machines: Market share about 40 percent and growth rate at about 7 to 8 percent per annum and this product is in high demand as it is required by railways and also for export. Currently requires about 2.5 crores.
Steel Forgings: Market share of 5 percent and growth rate of about 8 to 10 percent per annum. This product is required by diverse market and is currently a loss making unit and requires about 1.50 crores for ISO certification.
Switch Mode Power Supply (SMPS): Market share of about 6 percent and growth rate 20 percent per annum and this is relatively new product launched just 6 months back. Required by electronic industries has good potential for being market leader and requires 5 crores.
Based on the analysis
Product A - Transformer Coils is in growth phase.
Product B - Cable Jointing Kits, Jelly Filled Cables is declining phase.
Product C - Electric point Machines is in growth phase.
Product D - Steel Forgings is in kind of maturity stage.
Product E - Switch Mode Power Supply (SMPS) is in growth stage.
Total amount required based on the units requirement is about 11 crores but the company can only arrange 5 crores,
My recommendation to Mr. Anant Kumar would be to invest in,