1. SWOT ANALYSIS
OF
MARICO INDIA LTD
SUBMITTED TO: SUBMITTED BY
PROF. NIHIT JAISWAL AARTI BHAWSAR
MBA 3rdSEM
SEC. P
2. DEFINITION OF THE BUSINESS & COMPANY
The company was founded in 1857 By Kanji Morarji
and is headquartered in Mumbai ,India.
Marico Limited, together with its various consumer
goods and services in India, the Middle East, Asian
countries, Egypt, and the United States.
The company provides coconut oils, edible oils, hair
oils and other hair care products, fabric care products,
processed foods, soaps, and baby care products, as well
as skin care and ayurvedic products.
3. VISSION & MISSION
Consumers: For they are the reason we exist
Membership: For a sense of ownership empowers us.
Excellence: For it unleashes our potential
Wealth: For on it hinges our growth
Innovation: For it gives wings to ideas
MISSION 2020
The Marico Innovation Foundation’s mission is to provide
the nation with first: a belief that Innovation is possible
and is the way to leapfrog India into the center stage of
global business leadership, and second: a framework to
leverage innovation for quantum growth.
4. Goals & Objective : wish to achieve by 2010
Company commit itself to improving the quality of people's lives in several parts
of the world, through branded Beauty & Companyl products and solutions.
Company shall offer brands that enhance the appeal and nourishment of hair
and skin through distinctive products and services based on the goodness of
coconut, other natural substances .
Company shall make available brands that contribute to healthy living, through,
both products drawn from agriculture offered in natural or processed forms, and
services.
Company shall develop, in parts of the world beyond the Indian Subcontinent, a
franchise for the branded products and services.
Company shall aim to be a leader in each of its businesses through heightened
sensitivity to consumer needs, setting up of new ideas.
Company shall share prosperity amongst members, shareholders and associates,
who contribute in improving equity and market value.
Company shall acquire the status of a friendly corporate citizen, contributing to
the betterment of neighborhood communities,where Company are significantly
present.
5. SHAREHOLDER NO OF SHARES %
Arisaig Partners (Asia) Pte.
35,353,269 5.8
Ltd
T Rowe Price International
22,040,548 3.62
Inc.
The Royal Bank Of Scotland 19,092,286 3.13
HDFC Trustee Company 13,840,500 2.27
Azim Hasham Premji 11,589,417 1.9
Franklin Templeton Mutual
10,078,146 1.65
Fund
Acacia Institutional Partners 9,949,389 1.63
Morgan Stanley Investment
6,704,116 1.1
Management
Franklin Templeton
6,615,163 1.09
Investment Funds
6. Bankers
Axis Bank Ltd
Citibank
HDFC Bank Ltd
HSBC
ICICI Bank Ltd
Kotak Mahindra Bank Ltd
Standard Chartered Bank
State Bank of India
7. PRODUCT-MIX
BRANDS TARGETED CUSTOMER'S
PARACHUTE •Primary Target Women Of All Age's
PARACHUTE
ADVANCED •Young Girls (College & School Going)
HAIR & CARE •Appealing To Both Men & Women of All Age's
•Primary User the Young Age Group
SHANTI AMLA •Customer Looking for Value for Money
(H.OIL+Badam)
SILK & SHINE •Primary Target Female Of age 18 – 34
AFTER SHOWER •Primary Target Young Males 18 – 34
MEDIKER •Young Children Age Group 3-13 (Due to Lice
Problem)
SWEEKAR •Primary Target Housewives (Due to
Economic+Healthy Life for Family)
SAFFOLA •All Health Conscious Consumers (Specially for Heart
Patient's)
REVIVE •Housewives of Urban Area (Higher & Middle Class).
8. MARICO BRAND PORTFOLIO
HAIR OIL HAIR CARE EDIBLE OIL OTHER
CATEGORY CATEGORY CATEGORY PRODUCTS
HAIR & SHANTI
PARACHUTE
CARE AMLA
SIL JAM KAYA
REVIVE
AFTER MEDIKER SKIN
SILK &
SHOWER
SHINE
SAFFOLA SWEEKAR
OIL
9.
10. TOP MANAGEMENT
Name-Designation
Mr. Milind Sarwate : Cheif - HR and Strategy
Mr. Rakesh Pandey : Chief Executive Officer - Kaya
Mr. Vilas Shirhatti : Chief - Technology
Mr. Saugata Gupta : CEO - Consumer Products
Mr. Vijay Subramaniam:Chief Executive Officer -
International Business
Mr. Vinod Kamath : Chief - Finance and IT andCompl.
Officer
11. COMPITITORS
Amar Remedies Ltd. J L Morison (India) Ltd.
Ador Multiproducts Ltd. JHS Svendgaard Laboratories
Bajaj Corp Ltd. Ltd.
Colgate-Palmolive (India) Ltd. Jyothy Laboratories Ltd.
Dabur India Ltd. Jyoti Cosmetics (Exim) Ltd.
Emami Ltd. My Fair Lady Ltd.
Farmax India Ltd. Paramount Cosmetics (I) Ltd.
Fem Care Pharma Ltd. Procter & Gamble Hygiene &
Gillette India Ltd. Healthcare Ltd.
RayBan Sun Optics India Ltd.
GKB Ophthalmics Ltd.
Velvette International Pharma
Godrej Consumer Products Ltd. Products Ltd.
Godrej Industries Ltd.
Hindustan Unilever Ltd.
12. JOINT VENTURE
1.Marico Buys JV Partner’s Stakes(23 per cent stake) ;2003
2.ADANI (50:50 joint venture)
3.It acquires Oriental Extractions-Manjal from Oriental
Extractions Pvt Ltd; Jan 03, 2006
4.It acquires Hindustan Lever Ltd-Nihar from Unilever ;Jan
27, 2006
5.It acquires Sundari a manufacturer of skin care products
(7.5 per cent stake in Sundari)
6.It acquires Oil of Malabar from West Coast India; Nov 01,
1999
acquired the aesthetics business, of the Singapore based
Derma Rx Asia Pacific Pte. Ltd. (Derma Rx), under the
Kaya portfolio
13. Operating Profit Margin(%) = EBIT/sales*100
year calculation Total
2010 320.58/2001.50 16.01
2009 254.70/1921.85 13.25
2008 196.18/1568.78 12.50
2007 193.35/1371.66 14.09
2006 139.10/1044.91 13.31
Interpretation:
company's revenue is left over after paying for variable costs of production such as
wages, raw materials, etc. In the 2010 the Operating Profit Margin is 16.01% which is
the highest in the last 5 years so that the Company will to be able to pay for its fixed
costs, such as interest on debt.
14. Gross Profit Margin(%)=Gross Profit/sales*100
year calculation Total
2010 317.78/2001.50 15.64
2009 235.92/1921.85 12.27
2008 190.96/1568.78 12.17
2007 185.98/1371.66 13.55
2006 142.20/1044.91 13.60
Interpretation:
In the 2010 the Gross Profit Margin is 15.64 % which is the highest in the last 5
years so that the Gross profit margin will to be able to pay additional expenses and
future savings.
15. Net Profit Margin(%) = Net Profit After
Tax/Sales*100
year calculation Total
2010 235.02/2001.50 11.57
2009 142.12/1921.85 7.39
2008 143.42/1568.78 9.14
2007 122.36/1371.66 8.92
2006 101.14/1044.91 9.67
Interpretation:
Net profit margin will to be able to pay the operational expenses .In 2010 the
company is more able to pay the interest, tax, dividends and so on.rather than
previous years.
16. EPS = Net Profit After Tax*Preference
Dividend/no. of equity share
year calculation Total
2010 235.02/60.93 3.86
2009 142.12/60.90 2.33
2008 143.42/60.90 2.36
2007 122.36*1.65/60.90 2.01
2006 101.14/58 1.74
Interpretation:
Earnings per share serves as an indicator of a company's profitability. There is
consistence increase in EPS. No. of equity shares are stable in 2007, 2008 and 2010
and not much diffrence in 2009 and 2010 so it shows that the policies of the
director of the company is yery good.
17. Return on Net Worth(%) = EBIT/Total Net
Worth*100
year calculation Total
2010 320.58/571.66 56.07
2009 254.70/367.68 69.27
2008 196.18/280.23 70.06
2007 193.35/183.49 105.37
2006 139.10/277.36 50.15
Interpretation:
There is decrement in Return on Net Worth from 2007 to 2010 continously so profit of
the company generates with the money which shareholders have invested is
decreasing. Return on Net Worth measures a corporation's profitability .
18. Dividend on Pay Out Ratio = DPS/EPS
year calculation Total
2010 0.66/3.86 0.17
2009 0.66/2.33 0.28
2008 0.66/2.36 0.27
2007 0.66/2.01 0.32
2006 6.20/1.74 3.56
Interpretation:
The Dividend on Pay Out Ratios are decreasing because now policy is that the
company is reinvesting the profit in the firms activity rather than as a cash payout to
shareholders
20. PERACHUTS
COCONUT OIL NIHAR,
& KAYA SKIN
SAFFOLA (EDIBLE MAHA
OIL), SILK N
SHINE THANDA
21. 1.STAR
It is represented a product having high relative
market share and high market growth rate.
It need capital over and above its cash flow to
maintain it’s market share. It provides cash for growing
stars. It suggested Expansion Strategy for STAR ..
E.G. KAYA SKIN CARE AND PERACHUTS COCONUT
OIL IN MARICO AND IN THE INDUSTRY HLL AND
GODREJ COMES IN THIS CATEGORIES.
22. 2.QUESTION MARK ???
It represented by a Product having low relative
market share and high market growth rate I.E low
market share in a growing market. It requires large
cash due to market growth, but generates less cash
due to low market share.It requires additional
investment to increase it’s competitive advantage.
E.G NIHAR, SAFFOLA AND IN THE WHOLE
INDUSTRY DABUR COMES IN IT.
These product company given more advertisement.
Because these product not more popular in the
market. So company given more cash to these product.
23. 3.CASH COW
It represent by a Product having high relative market
share and low market growth rate. It is not
attractive in long ran due to less market growth rate.
E.G SAFFOLA (EDIBLE OIL), SILK N SHINE
competitor -FORCHUN OIL , DHARA OIL etc.
To meet the investment need of stars on question
marks, over heads and growth strategy is suggested.
24. 4.DOG
It represents a product having low relative market
share and low market growth rate. It has very low
competitive position due to high costs, poor quality,
poor marketing etc.It also has low growth potential
due to low market growth rate. The preferred strategy
is retrenchment.
EX. MAHA THANDA
Copititor-navaratn cool
25. AWARDS
Marico has also won various other Awards, such as the following:
Marico won 4 Awards for excellence in Employer branding &
Advertising to Talent at the Remmy Awards 2009 .
Saffola won Media Abby Gold for the World Heart Day Radio
entry - " Radio goes silent" at the Goa Fest 2009 .
Marico was awarded the IMC Ramkrishna Bajaj National Quality
Award in Manufacturing Category by the Indian Merchants'
Chamber .
Parachute won the Asia Star Award for the Parachute bottle
warmer awarded by Asia packaging Federation .
Parachute ranked 6th Most Trusted Brand in Bangladesh by The
Bangladesh brand forum - an affiliate of the Global Brand
Forum, Singapore in 2008 .
Parachute won the Outstanding Marketing Achievement
A w a r d - S ilv e r in 20 0 8.
26. STRUCTURE
A Flat Structure : Marico has a flat organizational structure,
with just five levels between the Managing Director and
the shop floor operator. At Marico, everyone is a member
and not an employee. As a member, each individual is
empowered..
Profit Centers:
This division manufactures & markets Marico's 10
leading consumer product brands like Parachute,
Saffola, Kaya Skin Clinics under the banner of Kaya
Skin Care Ltd. All the above profit centers have their
dedicated marketing teams, distribution channels,
sales force.
27. Finance:
The company is strongly supported by the Finance
Division, which handles the legal, treasury, tax, control
systems and management information support.
HR:
Equal support comes from HRD team, which expends
its energies, formulating and building strategies to
build a stable and high - talent organisation.
29. Strength
FINANCE
Centralized payment
Decentralized collection
Low invest
Source of funds
Management of funds
2009-10, the company generated a Turnover of about
Rs.26.6 billion (USD 600 Million) In 2008-09 13.6
billion (about 380 million)
15%profits-over last 5 years
30%* market share (640 billion)
30. Marketing
widespread distribution network of more than 2.5 Million
outlets in India and overseas.
innovative approach :focused on meeting the emerging
needs of the modern day consumers
Wide variety of product
Understanding of Indian consumer behavior in the hair oil
segment
Large distribution network all over India.Rural market
reach
one of the largest amongst Indian FMCG company.
Marico reach approximately 130 Million consumers in
about 23 Million households
No. 2 player in the growing VACNO (Value Added Coconut
Oil)
31. Strong brand equity
Wide global presence
High bargaining power
Diversification of business by expansion
32. Operation
Plant location as per raw materials availability
Low cost operations
Absorb imported technology
R & D system is so good
MIS system of operation and control system
Plant location
Production system
Operation and control system
Strong in inventory control (28 days)
In house production –no outsourcing-high reliability
supplierssuperior quality assurance.
India and foreign production location-spread benefit.
33. Cntd.
Use JIT (just in time) approach for handling of raw
material
Known for their which reliability which comes from
efficient operations
34. HR
a flat organizational structure
empowered : everyone is a member and not an employee
Marico’s structure is dynamic & constantly
Good personnel system
Good industrial relation with other company
Personnel system
Organisational and employee characteristics
Industrial relations
Quality and motivation of personnel
rated as one of the most innovative companies by Business
Today -Monitor Group
35. Weakness
FINANCE
Fixed price
Sales of Rural Area was Slowly Decreasing.
Marketing
Not strong within the shampoo segment, having
hardly any share
Not having any antidandruff hair oil whose market
potential is worth 25% of the total oil market in India.
Low company image
Low promotion
Low export level
36. Contd…
Operation
High cost of branded products
HR
High dependence on Parachute
High leverage compared to peers
Indian labour laws are relatively unfavorable to the
trades and there is an urgent need for labour reforms
in India
37. Opportunity
Finance
India's Rs.460 billion FMCG market
Increase Income Level With Result in Faster Revenue Growth.
Marketing
Need to concentrate within the various others market potential
zones like hair shampoo, hair colorants etc.
Large Domestic Market
Growth Marico, is betting big on its international business and is
open to acquisitions provided they fit in with its overall growth
strategy .
Growth in international markets
Successful entry into beauty and healthcare market
Untapped rural market
In rural markets, brands are non-existent
38. Operation
Constant innovation
access international technology
Huge Distribution Network :including 2 million in 3,160
towns and four million in 627,000 villages.
Low education level.
Foreign countries emerging as a leading buyer of the products
Expand geographical presence
Less developed infrastructure.
HR
India is rich in highly trained manpower
Industry has large and diversified segments that provide wide
variety of products
Population
39. Threats
Finance
Marico’s debt-to-equity ratio for FY 2008 was 1.1, which is the
highest among the FMCG companies. Any further large
acquisitions financed by increasing leverage.
Tax and Regulatory structure
Economic slowdown resulting in lower consumer spending
Currency risk: Marico derives approximately 20% of its revenues
from international markets.
Marketing
Marico's key raw materials include copra, kardi oil, sunflower oil,
corn oil and rice bran oil, which are commodity crops whose
availability isseasonal.
Competition from the diverse players present in the market can
cause loss of market share.
Intense competition from global brands in international market
40. Operation
High cost of Land
Environmental regulations
Infrastructural bottlenecks in terms of power, utility, road transport
etc
Inadequate transport
Geographical Disadvantages
Retailers are becoming stronger and are wielding more power over
manufacturers
HR
More job opportunities for the Human Resources around the world
International labor Laws
Despite technological advances, beverage sector remain labour-
intensive
Labor problems
Any change in Government policy
41. Benchmarking
Strategic Benchmarking
Procter & Gamble Hygiene & Healthcare Ltd is the
benchmark for the in strategic benchmarking.
Competitive Benchmarking
HUL is the benchmark for the M&M in Competitive
benchmarking
Process Benchmarking HUL
External Benchmarking Marico’s shares on Wednesday closed
at Rs112.25 on the Bombay Stock Exchange, down 0.22%. Dabur
closed 1.19% higher at Rs180. The benchmark Sensex closed
1.76% lower at 17,380.08 points
Internal Benchmarking
Marico is setting the example to others for his Internal
benchmarking.
42. PLC MODEL OF MARICO INDIA LTD.
KAYA SKIN SAFFOLA
NIHAR, SIL CARE AND (EDIBLE MAHA
JAM PERACHUTS OIL), SILK N THANDA
COCONUT SHINE
43. Stage Characteristics
Market introduction stage
slow sales volumes to start
demand has to be created
makes no money at this stage
Growth stage
costs reduced due to economies of scale
sales volume increases significantly
public awareness increases
competition begins to increase with a few new players
in establishing market
The preferred strategy is growth
44. Contd…
Maturity stage
The preferred strategy is stability or modest growth
sales volume peaks and market saturation is reached
increase in competitors entering the market.(fortune,
dhara)
brand differentiation and feature diversification is
emphasized to maintain or increase market share
Saturation and decline stage
sales volume decline or stabilize
prices, profitability diminish
profit becomes more a challenge of
production/distribution efficiency than increased sales
45. STRATEGIES
CORPORATE LEVEL STRATEGIES
Emphasis on providing value goods to consumers,
Joint venture and acquisition with players like Hll,
adani & sundari.
Sustained expansion in capacity to meet the growing
demand of Edible oil in India.
Diversify geographic footprint, and enhance scale and
reach of operations.
46. BUSINESS LEVEL STRATEGIES
Early entry in business
Accurate demand forecasting
High capacity utilization
Price based compition is so serve that cost becomes an
important factor.
Company make product for skin is Kaya Skin Care
these is so nuch differentiation to other.
Night cream is PARASHUTE NIGHT REPAIR CREME
47. FUNCTIONAL LEVEL STRATEGIES
widespread distribution network.
Strategy of PARASHUTE product on popular and
premium range products.
48. Suggestion
Marico is the leading industry in FMCG sector in
edible oil,beauty n health care segment in India but
can also target other segments.
Pay attion towards R & D.
Adopt the eapansion strategy.
Increase the Export.
Increase the brand image Shanti Amla & Nihar
Promotion Policy
49. Conclusion
Company Marico has strong and long term association
with the retailer's in rural area's .
Parachute is the most satisfied Brand/product,
followed by Saffola, Silk & Shine Hair & Care, and
Sweekar Edible Oil & after Shower Gel.
