CASE ANALYSIS

AND PROPOSAL
TECHLINK PERIPHERALS:
NAVIGATING GROWTH
AND CHALLENGES

Team Academia Underbelly

Case Overview: 5 Cs Analysis
Company : PC Peripherals Manufacturer, Total Revenue INR 35,00,000, Total Workforce 80,
Located in Hitech City, Hyderabad

Customer: B2B model likely because it is a manufacturer; TAM consists of PC

manufacturers, probably untapped, low customer satisfaction due to operational
disruptions, uncompetitive prices and outdated technologies.

Competitors: Chinese manufacturers selling at competitive prices, local manufacturers

with new technology

Context: Locational challenges because of rapid expansion of current location, new

technology in the market, stringent regulatory environmental laws, global chipset shortage

Collaborators: Potential investor TechConnect Innovations, raw material suppliers; and

distributors and retailers of finished goods
 THE PROBLEM
STATEMENT
To evaluate the multidimensional implications of TechConnect Innovations’ investment
offer and decide on whether to accept it.

FACETS

• Workforce Training • Land Relocation • Technology • Decision Making • Waste Management

• Recruitment • Global Chipset Supply Upgradation Needs Authority MOTHER
• Regulatory Compliance
MAN MATERIAL MACHINE MANAGEMENT
• Loyalty Of Existing • Valuation & Funds • Partner Stake NATURE
Workforce • Capital sources • Value Congruence &
• Financials Synergy
• Allocation of resources
 IMPLICATIONS OF ACCEPTING THE
OFFER
BU SINESS GROWTH
& CHALLENGES
• Pr o d u ct line exten sio n an d
d ep th th ro ug h tech n o lo g y
u p g r ad e
• I n cr ease in p rod uctio n
cap acity and op eratio n al
eff iciency
• D o mestic an d g lob al mar k et
ex p an sio n
• I n cr eased com petitiv e ed g e
• Back ward integ ratio n w ith
tech partn er
• Tem p o rary op eratio n al
d isr u p tio ns d u e to r elo catio n
EMPLO YEE
DISPLACEM ENT
• Wo r k f o r ce u p sk illin g
lead in g to b etter eff icien cy
b u t ad d itio n al co st.
• N ew r ecr u itm en t p o ten tial
w ith b etter- tr ain ed f o r ce.
• Po ssib le r elo catio n co st to
em p lo y ees lead in g to
d issatisf actio n am o n g o ld
w o r k f o r ce.
PRO FIT
MA RGINS
• I n cr ease in lo n g ter m
p o ten tial marg in s w ith
u p g r ad ed tech n o lo g y.
• Co n d itio n s imp o sed ar e
temp o r ar y co st cen ter s that
may r ed u ce p r o f its.
• Tem p o r ar y p r o d u ctio n co st
in cr eases at cu r r en t
cap acity.
CH AN GE IN
CO NTROL
• Cu ltu ral r ead ju stmen t
with Tech Co n nect
In no vatio ns.
• Possib ility o f
In terperson n el con flicts.
• Relinq uish ed absolu te
co ntro l o v er decision
makin g. Special
resolutio ns req u irin g 7 6%
majo rity can ’t b e passed
u nilaterally
• Sen io r to mid dle lev el
lead ersh ip co n flict
 IMPLICATIONS OF REJECTING THE
OFFER
BU SINESS GROWTH
& CHALLENGES
• N eed fo r alternate in v estmen t
r o u tes to sustain
• Po ten tial o peratio n al d isr u p tio n
b ecau se o f lo catio n
• Stag n an t revenu e ar o u n d
3 5 ,0 0 ,0 00 with in cr ease in co st
cen tr es d ue to declin e in mar k et
sh ar e, o utd ated tech n o lo g y, etc.
• Cu sto mer chu rn du e to d elay s
an d q uality issu es
• Po ssib ility o f insolv en cy
EMPLO YEE PRO FIT CH AN GE IN
DISPLACEM ENT MA RGINS CO NTROL
• Po ssib le attr itio n o f lo y al • A ssu m in g an in d u str y • Reten tio n o f
em p lo y ees d u e to lack o f stan d ar d o f 1 0 % EBI TD A , manag ment co ntro l,
g r o w th p r o f its to r em ain stag n ant at lead ing to my o pia an d
• Sk ill stag n atio n lead in g to 3 .5 lak h s o r d eclin e f u r th er p ossib ility o f
em p lo y ee d issatisf actio n d u e to in cr easin g co sts insolvency
• A lter n ate in v estmen t r o u tes
lead to h ig h er co st o f cap ital.
Assum ing 1 0% interest rate, a debt o f 1 0 cr to
co st 1 cr. an nually, tak ing th e requ ired b reak
ev en rev en ue to 1 0 cr.,
30x
of cu rrent revenu e - difficult to ach iev e
 RECOMMENDED SOLUTION
TechLink Peripherals should accept the investment offer from TechConnect Innovations for its capital requirements and
strategic growth. It should continue its operations at current production facility and shift operations to the new technology
district in a phased manner.
UNLOCKING VALUE

STRATEGIC FINANCIAL OPERATIONA HR & ESG

• Fuelling growth
• Risk Mitigation
• Credibility Enhancement
• Long term Focus
• Competitive Advantage
• Exit Opportunity At a
Later Stage
• Global Expansion
• Access To Cheap Capital
Compared To Alternate
Capital Routes
• Increased Valuation..
Assuming a standard
Industry Revenue
Multiplier of 10, current
valuation is pegged at 3.5
cr. But investment offer
values the business at 20
cr.
L and
• Tech Expertise • Upskilling Of Existing
guidance ofthe investing Workforce
partner • Cross-Cultural Exposure
• Easy Resource Access • Talent Attraction
Through Relocation To • Sustainable Waste
Integrated Manufacturing Management
Cluster • Enhanced Community
• Scalability Relations
• Regulatory Compliance
THANKS
FOR
WATCHING
TEAM ACADEMIA UNDERBELLY