MM 1 PROJECT

Group Members
Shivani Khanna-P211B061
Shivi Nayyar- P211B062
Simran Agarwal- P211B065
Sravani -P211B067
Tripti Jhawar-P211B069

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Table of Contents
1 Executive Summary.............................................................................................................3
2 Introduction........................................................................................................................3
2.1 Pre Covid-Situations....................................................................................................3
2.2 During Covid Pandemic Situations..............................................................................4
2.3 Post Covid Situations...................................................................................................4
3 PESTEL Analysis:..................................................................................................................8
4 Porter’s 5 Forces...............................................................................................................10
5 Internal Analysis:..............................................................................................................11
5.1 Company Background...............................................................................................12
5.2 Scope Of Operations..................................................................................................12
5.3 Performance till Date ................................................................................................13
6 SWOT Analysis:.................................................................................................................14
7 The Future RoadMap:.......................................................................................................15
8 Aftermath of Covid-19 and the way ahead......................................................................15
9 Competitive Analysis........................................................................................................16
10 References:.......................................................................................................................17

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Executive Summary
Havells India Limited is currently the largest Indian FMEG (Fast Moving Electrical Goods)
company with its presence across the globe. From investors’ point of view, it is a
trustworthy stock for long-term investment purpose as for past five years as it has been
growing at continuous rate. Even during the pandemic period, it has also performed well.
Havells India Limited, in recent years have been doing overwhelming well and have grown
by more than 400 % in past 5 years. The company over the years has been capitalizing on its
strengths and has reached to new milestones years after years
The company under the leadership of Anil Rai Gupta has been able to perform very well
since 2014. Even though Covid had impacted its business due to the lockdown but post-
lockdown recovery has been great and all the segments showing promising growth.

Introduction
Havells India Limited is Indian FMEG (Fast Moving Electrical Goods) company with global
footprint. It was founded in 1958 by Qimat Rai Gupta and has its head office in Noida. Anil
Rai Gupta is its current chairperson and MD. It has special status and has dominance in
market across wide variety of products including Domestic and Industrial Circuit Protection
Devices, Wires and Cables, Modular Switches, Motors, Fans, Power Capacitors, Luminaires
for Domestic, Home Appliances, Electric Water Heaters, Air Conditioners for both
Commercial and Industrial Applications.
Havells owns some of most famous and respectable brands like Lloyd, Crabtree, Standard,
Promptech and Reo. It employs more than 4000 professionals and over 7900 dealers and 40
branches across India. Havells has 13 manufacturing plants producing world class products.
The company is trustworthy for excellence and precision in the industry

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2.1 Pre Covid-Situations
Havells has been doing decent before pre covid times, the company posted a 8.38 % YOY
downfall in its net profit during the Jan-March of FY 2019. The company had net profit of Rs
225.76 Crore during the end of FY 2018. As per firm’s statement the FY 2018 included figure
from Lloyd consumer division. Havells made a total of Rs 206.83 for the quarter ended
March 2019.
But the overall net total income for FY 2019 increased to Rs 2782.81 Crore while for the
income o Rs 2560.64 Crore was recorded for previous financial year.

2.2 During Covid Pandemic Situations

Havells like every other industry and segment was hard hit by the effects of the pandemics.
Its business reported a sharp 14-24 % YOY decline in sales due to various situations like
Lockdown, and Covid widespread in the country. Consequently, the operating profit and
revenue fell by 22 % and 20 % YOY respectively.

2.3 Post Covid Situations

As the effects of pandemics was receding, there was observable growth in the market. The
country’s economy was expanding. On the same lines even, Havells share market price
increased by 11.75 % to hit record of Rs 1141 on the BSE. The profits for the October-
December 2020 rose by 75% to Rs 349 as compared to Rs 199 Crore for the same period last
year. Its total revenues rose to Rs 3615.85 Crore from Rs 2269.87 Crore.

PESTEL ANALYSIS

P - POLITICAL 
Havells has been in a number of legal cases inclusive of patent, trade mark
infringement, comparative advertising which have stood the test of time. 
Excise duty exemption for Pig Iron and ferro silicon magnesium for producing Cables
have boosted demands for electrical wires and cables.
Change in GST bucket to 18, growing infrastructure and favourable government
initiatives have increased the demand for cables.

E -ECOMONICAL
The cable's key development drivers are rising industry and urbanisation. Global
investors see India as a rising market for high voltage (HV) and extra high voltage

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(EHV) cables and wires. Reduced house loan rates would boost demand for cables
and wires even more.

However, increasing raw material costs and Import restrictions are restraining the
growth at times.

 S-SOCIAL

Havells as an organisation has always been beyond par when it comes to assuming
its responsibility as a good corporate citizen and has consistently put that philosophy
into action in the form of several projects that deliver social wellbeing. 

 Contribution to UN sustainable Development Goals through Wash (Water,

Health and Sanitation) initiative.
 The company has been an invested entity in Mid-day meals serving over
600000 students in 693 schools daily.
 5 Lakh + saplings and 11 lakhs + trees planted in the year 20-21.

T-TECHNOLOGICAL

With an annual spend of around 100 crores in Research and Development for the
year 20-21, Havells makes sure that it has edge when it comes to innovation for
developing world class products. Therefore, Intellectual Capital is one of the cores of
Enterprise Risk Management strategy at Havells.

With aggressive digitalisation for operations and processes, the brand has catered to
the rising needs of the changing times. Moreover, the responsibility of offering the
greatest and safest goods and zero-defect services to its consumers in order for them
to be comfortable and secure in their use of electricity.

E-ENVIRONMENTAL  
Havells’ “Call to Action” is an initiative based on Science Based Targets, directed
towards reducing the absolute emissions below the 1.5 degrees threshold. With goal
attainment of over 4.5 GWh of renewable energy generated, 11 lakh trees planted
and 42% emission intensity reduced comparative of 2015-16, Havells has been on
the right path when it comes to ticking Environmental checkboxes.
The cables are manufactured under strict Environmental guidelines and
stringent rules are followed and ensure minimum electricity wastage.
 
L-LEGAL

The cables manufactured are safe, reliable, lead and halogen free and fire resistant
as under the Bureau of Indian Standards Act, 1986 the Electrical wires, cables,
appliances and protection devices and accessories (quality control) order, 2003 is
applicable for manufacture, storage for sale, sale or distribution of the same.

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At the same time, implementation of all kinds of precautionary measures at the
workplace and beyond is subjected.

PORTER’S FIVE FORCES ANALYSIS

1. Competition in the Industry

India’s Electrical industry is growing at a thriving rate of 9% and thus
competition is cut throat. With Increased residential and commercial
infrastructure at rise, every competitor is pushing their limits to grab onto the
market share. Havells's is ranked 2nd among its top 10 competitors in revenue
generation. The average for top 10 competitors is 6.9B. In Q1 2021's revenue was
$319.3M; in Q4 2020, it was $433.3M; in Q3 2020, it was $333.2M; in Q2 2020,
Havells's revenue was $200.5M.

Here’s a market capital share of the top competitors of the electricals market. 

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 2. Potential of new entrants into the industry
New entrants like Delton cables, CMI, Cords cable Ind, Surana Telecom are
steadily gaining customers owing to their price bandwidth and local reach.
The rise of e-commerce portals has also helped small, new brands reach
through the customer base.

3. Bargaining power of Suppliers

Raw Materials like Metals (Copper, nickel, etc.), plastic, chemicals etc. are
used in electronic manufacturing industries and in India a large number of
suppliers are there in the market so suppliers possess low bargaining power.
As the raw material is easily available which leads to highly standardized
products it is available through multiple vendors.

4. Bargaining power of Buyers

Havells main focus is on Household electrical products and due to digitization
individual customers have all the information about the market scenario.
However, Havells budgeted pricing with premium quality stands out from
other players. Therefore, we can say that the buying power of customers is
moderate.

5. Threat of Substitutes
The threat of substitutes for Havells cables is not really up there as cable is an
essential product for every household and industry. 

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INTERNAL ANALYSIS
 
 
5.1 COMPANY BACKGROUND
The company started off with industrial and domestic cables manufacturing in 1996
in their own plant in Alwar, Rajasthan which is spread across an area of 404686
Square Meters and is the largest integrated single location plant in the country since
1996. Since then, it has been an end-to-end solution in the power distribution
equipment industry

5.2 SCOPE OF OPERATION 

 Company’s acquisition of Lloyds Consumer has tapped into a new
market segment of ACs and Washing machines, making the company a
360^ electrical solutions provider.
 Company’s launch of grooming products, the demand for which has
seen a sharp rise both for men and women will add onto the revenue
stream of the company. Company aims to capture 25% market share in
the personal grooming segment in the next 3 years.
 Rapid industrialisation, infrastructure development and urbanisation has
been the major contributor to the cable segment.
 Government’s major electrification initiatives through nooks and corners
of India has been a constant opportunity for the company for the past 4
years.

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 Consumer Industrial

Fans Heavy Duty Fans

Lightning Professional Lighting

Appliance Cables

Switches Motors

Switchgear Switchgear and Controlgear

Water Heater Power Quality Solution

Flexible Cables Solar

Air Cooler

Personal Grooming

Water Purifier

Solar

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5.3 PERFORMANCE
 Havells enjoys a strong brand name and intensive distribution channel of over
7575 dealers, over 500 plus Havells galaxies and around 100000 retail outlets.
 It has had sort of a first mover advantage and so it is a market leader in the
domestic wires, cables and switchgears segment and so company has seen a
consistent rise in its earnings and profits, profit margins have also improved
significantly.
 The company provides durability, safety, reliability and variety in this segment
and has been a proven choice for many since the last decade.

It can be observed that Havells has total debt to total equity as 0.708 which does not seem
that bad as lower ratio denotes that less amount of the company is owned by its creditors
compared to shareholder equity held by company.

It can be observed that the Inventory Ratio decreased signalling that the sales are not up to
expected level, that is whatever is being produced is not being able to be converted into
sales. It is of paramount importance that immediate and necessary actions to be taken
improve this situation.

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SWOT ANALYSIS OF HAVELLS INDIA
STRENGTHS
1. With a presence in over 50 countries, they have a strong global distribution
network.
2. Every year, it invests heavily in research and development, allowing it to
provide novel solutions to its consumers. (Currently 70 percent of the
production is energy-efficient.
3.  Strong Brand Image with even stronger presence in local markets.
4. Variety and Quality of products dealing in diverse verticals.
5.  Havells Product Range is Radioactive Free.

WEAKNESS
1. A high debt-to-income ratio.
2. Globally, the market share is small.
3. Real estate market slowdown

OPPORTUNITIES
1. Globally emerging markets.
2. The demand for energy-efficient products is increasing.
3. Acquisition of Chinese manufacturing enterprises for low-cost production.
4. Integration of Havells retail shops on a vertical scale (Havells galaxy)
5. Explore the possibilities for more ecologically friendly items and their disposal.

THREATS
1. Low-quality, low-cost imports (e.g., from China) flood the market, competing
with locally produced goods.
2. Environmental laws governing industrial waste.
3. Intense sector competitiveness.
4. A global market slowdown will have a more negative impact following a series
of mergers (e.g., Sylvania acquisition).

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FUTURE ROADMAP
The company’s product portfolio is pretty diverse with products ranging from home
and culinary appliances, as well as lights for personal, commercial, and industrial
purposes, cables, personal grooming products, Fans, coolers, heaters etc. The
demand for these products gets highly affected by competitor pricing, consumer
preference and changes in the technology sector. Therefore, an increasing
investment in the Intellectual capital is a non-negotiable for the company.

The company also needs to work on, to increase global share and capture the
emerging markets with an increasing presence, good inventory management and a
top-notch supply chain management.

AFTERMATH OF COVID-19 AND WAY AHEAD…

The company hit a blow with decreased sales and production leading to cash
conservation, disturbed supply chains and downscaled operations specially with its
dependence on imports from China.

As far as concerns of tackling the slowdown in certain segments, management

should increase off take by increasing credit terms and offer good discounting.

Advertisements have been a core future investment at Havells and must be

maintained in a similar manner to stir demand.

Overall, the company has stood the test of time as evident in demonetisation of 2016
and post covid with correction of supply chain disturbances. The company remains
an investor favourite through and post covid. However, there is a need to stir
demands as it remains flat at the best.

Cable segment

Starting of the pandemic was a downhill for the Indian cable and segment as any
construction, infrastructure development or industrial demand remained tepid.

Havells revamped its cable and wire manufacturing facility at Alwar which coupled
with digitalisation efforts have been a healthy mix to growth. 

Constant push from the government for infra development, infusion of funds in
developmental projects, strict norms for electricity production, supply and
consumption have further helped the company maintain its place. 

COMPETITIVE ANALYSIS

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Bajaj Electricals
Strengths: -

1. Design, development, and production expertise spanning decades.

2. Strong financial performance.
3.  Diversified into a variety of businesses and able to tap into sophisticated
markets.
4. Its high liquidity has allowed it to invest in new technology and expand into
new markets.
5. Competitive pricing and market leadership.
 Weakness: -
1. The brand has less penetration across international market.
2. Market share is limited due to intense competition.

Crompton Greaves
Strengths: -

1. Customers across diverse segments will benefit from a broad product range
that provides end-to-end solutions.
2. Strong presence in the domestic power market, with a large installed base of
equipment and customers
3. Prompt post-sale service, thorough knowledge of market conditions, and
4. Geographically extensive

5. A significant amount of technology is absorbed and adopted to meet local

demands.

6. Innovative manufacturing infrastructure and a modern integrated

manufacturing base
 Weakness: -
1. Constraints in Technology
2. Working capital is very high

Finolex Cables
Strengths: -

1. Its TTM EPS growth ratio is high.

2. Quarterly net profit has improved, with profit margins growing year over year.
3. As a corporation with no debt, it is not financially strained.
4. The distribution channel is expanding.

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 Weakness: -

1. Company is not able to generate cash as it has a declining net cash flow.
2. Inefficient use of capital to generate profits as projected by ROCE.

PRODUCT PORTFOLIO 
 
 
Compan Havells Bajaj Crompton Finolex Cables
y Name Greaves

Vertical  Cables  Kitchen  Fans  electric

Domestic, and  lamps and wires and
industrial Domestic luminarie cables
 Profession Appliance s    electrical
al s   pumps  accessorie
Luminaries  Fans and  househol s
 Domestic Lighting d   lightning
Appliance  Mixer appliance products
 Water Grinder, s such as  switchgear
Heaters Gas water s
 Air Cooler Stoves heaters,  fans and
 Pump  Iron, mixer water
 Personal Blender, grinders. heater.
Grooming Ceiling /  Toasters,  
products Table / irons and
 Water Pedestal / electric
Purifiers Wall Fans lanterns.
 Solar  LED
Consumer Lighting.
&  
Industrial
equipment
s
 Industrial
Motor
 Heavy Duty
Fan

STP OF HAVELLS
Market Segmentation

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Market Segmentation refers to dividing the market into groups that have similar
characteristics, needs or behaviour, that may require separate marketing strategies
or marketing mix. Consumers' expectations can be best served when we know their
needs and we can do that most efficiently if we segregate different groups based on
internal homogeneity and external heterogeneity. 
The Cable market can be broadly divided into three end-use segments:

1)     Geographical 2) Industrial/Outdoor  and 3) Residential

Geographical Segmentation

     Geographical segmentation is done on the basis of various geographical units like

rural and urban in respect to Havells’ products. It separates the market between
rural and urban, with urban accounting for approximately 90% of sales, as well as
semi-urban, which purchases the majority of Havells' products, whilst semi-rural
accounts for only 10% of sales.

 ·       INDUSTRIAL

Havells manufactures wide range of industrial circuit protection, surge

protection devices, Ht and Lt cables, induction motors to professional
lightning and heavy duty fans
·      RESIDENTIAL
Havells produces some of the greatest wires in the country, which can
survive the test of time while being relatively safe from fire, heat, and
other natural factors. some of the distinct varieties of wires made by
Havells such as

Telecom Switchboard CCTV Speaker LAN

Cables Cables Cables Cables

 
Targeting
While targeting the previous existing customers, Havells should focus on Phygital Products
(Physical + Digital) which is the future of customers’ demand. Havells should target the
Growing middle-class population across the markets. Havells can create a brand aspiration
which can lead to a high sales volume with the help of strong distribution networking.
Havells should focus more on four key areas— product innovation, manufacturing,
distribution, branding and advertising which will help build brand equity for Havells.
 

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Positioning
Havells' positioning approach has always perplexed its rivals. Havells has created a
brand memory unlike any other thanks to aggressive branding, particularly on
television.
Havells has put money into a network that rivals that of its competitors. It has over
200 Havells Galaxy Stores and 2500 dealers around the country, with over one lakh
sellers.
Havells is also known for being a dealer-friendly company.
It makes environmentally friendly wires, extends better credit, offers more trade
discounts, particularly on early payments, and entertains dealers on international
excursions.
Havells is a popular brand among merchants because of all of these benefits. Havells
Cables, like the rest of the company's subsidiaries, is more focused on quality based
products. The products are standardised and are of a premium quality.

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REFERENCES
1. https://www.ojp.gov/pdffiles/156841.pdf
2. http://www.fratfiles.com/topics/Rivalry/60
3. https://www.havells.com/en/consumer.html#gref
4. https://www.havells.com/en/industrial.html
5. https://www.marketresearch.com/Heavy-Industry-c1595/Energy-Resources-c82/
Electricity-c407/
6. https://www.prnewswire.com/news-releases/electrical-equipment-market-in-india-
2021-2025--business-overview-industry-size-and-share-opportunities-impact-of-
drivers-key-vendors-products-applications--17-000-technavio-research-reports-
301365493.html
7. https://www.marketresearchreports.com/electrical-products

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