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Portfolio matrix

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Portfolio matrix Presentation Transcript

  • 1. PORTFOLIO ANALYSIS - By Prof. Purvish Shah BE ( Mech), PGDBM (Gold Medalist)
  • 2.
    • Product Life Cycle: It is a life span through which a product needs to move.
    Low brand loyalty sales is target Building awareness Promotion Selective new channels More intensive Selective Distribution Low price reduction Based on demand High/Low Price Reduced differentiation important More product/More features Few products Product Decline Maturity Growth Introduction  
  • 3.
    • Portfolio Matrix : Popularly known as BCG matrix
    • Developed based on product life cycle theory
    • by Boston Consulting Group.
    • What are the priorities for a company in given product portfolios
    • Helpful in long term value creations for a company
  • 4. Low Low High High Market Growth Rate Relative Market Share Cash Usage Cash Generation Dogs Cash Cow ? ? ? STAR
  • 5.
    • Dogs:
    • Low market share
    • Low Growth rate
    • Cash trap for companies
    • Question Marks:
    • Fast growing
    • Consumes major cash
    • Either become Dog or Star ( high risk)
  • 6.
    • Stars:
    • Generate Cash
    • High cash consumption
    • If taken care becomes Cash cow
    • Cash Cow:
    • Generate more cash than consume
    • Help other business grow
  • 7.
    • BCG matrix for ITC ltd.
    • ITC is formally known as Indian Tobacco company.
    • Company is in to diverse business portfolio like Hotels, Greetings, Cigarettes, Agarbatti, Specialty papers, Agricultural business, Cloths, Sports wear, FMCG products and Infotech business .
  • 8. Low Low High High Market Growth Rate Relative Market Share Cash Usage Cash Generation Dogs Infotech Cash Cow Cigarettes, FMCG ? ? ? Agarbatti, Cloths STAR Hotels, papers, Agri business
  • 9. BCG matrix for MARUTI SUZUKI Models available: Swift, Zen estillo, Swift Desire, sx4, grand vitara, A STAR, ALTO, 800, Wagon R, Versa, Baleno, Omni
  • 10. Low Low High High Market Growth Rate Relative Market Share Cash Usage Cash Generation Dogs BALENO, VERSA, OMNI Cash Cow 800, ALTO, WAGON R ? ? ? SX4, GRAND VITARA, A STAR STAR SWIFT, ZEN ESTILO, DESIRE
  • 11.
    • LIMITATIONS:
    • Only two factors taken in to consideration.
    • Data accuracy becomes very important
    • Business of low over all market share may also be profitable ( specialty/niche segments)
    • It ignores effect of synergy between different business.