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B2B Case Study Star Engineering Company LTD
B2B Case Study Star Engineering Company LTD
B2B Case Study Star Engineering Company LTD
Company Ltd.
CASE Study
Presented by
T Farzana
Vikram Baliga
Pritom Roy
Siddhartha Deshmukh
Case Facts
Star engineering company limited manufactured 5
products.
The company encountered problem deciding how to
allocate the funds to various products
The company had limited financial resources so it was
important to allocate the funds in a balanced
manner.
Product portfolio
Product A: Transformer coils, sold to telecom
exchanges. Market of transformer coil was growing
at a rate of 25% p.a
The coil was well accepted by the customers in terms
of quality and they had market share of 20%
In order to increase production capacity additional
investment 2 cr was required
POLITICAL
Congress government was in the centre
P.V. Narasimha Rao was the prime minister of India
The nation was shaken by a series of bomb blasts in mumbai
ECONOMIC
Economic growth in the world remained slow-moving in
1993
Economy had consolidated itself in the initial years of
eighth five year plan
Primary focus of eighth five year plan was human
development
GDP was 4%
Rate of inflation was between 7-8%
SOCIAL
Telecom industry was slowly growing in India giving rise
Technological
Infrastructure and technological changes had started
post liberalization.
Manufacturing sector had grown 8-10% for last
few years.
SWOT
Strength :
product A was well accepted by the customers in
Weakness :
Product B : Jointing kits were getting slowly
substituted by fibre optic cables and suitable jointing
kits.
Product B-Problems faced of substitution and
competition.
ProductD- despite of giving the best management
Opportunities :
Product A was having total market for the
Threats :
Because of unavailability of substitution in the
Question
If you were Anant Kumar what would be your
Product B
Product B
Product A
and C
Product B
Product E
Product D
Investment
Required
2 Crore
Decline
Electric point
Machines
2.50 Crore
Growth
Steel Forgings
1.50 Crore
Growth
5 Crore
Introduction
Recommendations
Option 1 Go for investment in Product A and
Product D
Total investment 2 cr + 1.5 cr = 4 cr
Reasons For Product A market growth rate was 25
percent per annum
For Product D domestic market was growing at 8
Recommendations
Option 2 - Go for investment in Product E
Total investment 5 cr
Reasons For Product E market growth rate was 20