1. Pak Elektron Limited.

2. Strategic Management
Group Members
Umer Shahzad
Muhammad Usman
Hafiz Farhan Saleem
Umer Farooq
Sajjad Zafar Pirzada
Muhammad Umar Farooqi
17
20
28
45
52
145

3. Introduction
By Muhammad Usman Roll # 20

4. PEL is a flag bearer of Saigol Group
TURNOVER
EMPLOYEES
MUSD
(Nos.)
TEXTILES
Kohinoor Industries
Azam Textile Mills
Saritow Spinning
31
1,678
500
569
ENGINEERING
Pak Elektron
Ltd.
232
7,036
FUEL & ENERGY
Kohinoor Power
Kohinoor Energy
86
98
137
349
10,018
SECTORS
COMPANY
TOTAL

5. PEL
Introduction
• Pioneer manufacturer of electrical goods in Pakistan
• One of the oldest and amongst the leading Home Appliances
Manufacturer and Distributor in Pakistan.
• The company has an annual turn over of Rs 20.3 billion.
• It was established in 1956 in technical collaboration with M/s AEG of
• Germany.
• In October 1978, the company was taken over by Saigol Group of
• Companies.
• Since its inception, the company has always been contributing
towards the advancement and development of the engineering
sector in Pakistan.
Pak Elektron Limited.

6. Historical Overview
Pak Elektron Limited.

7. COMPANY
OPERATIONS
Company’s operations are divided into two divisions:
1) Power Division
2) Appliances Division
Pak Elektron Limited.

8. PEL Product Line
Pak Elektron Limited.

9. PEL Product Line
DISTRIBUTION TRANSFORMER
DRY TYPE TRANSFORMER
POWER TRANSFORMER
SWITCHGEAR
PMT TRANSFORMER
EPC CONTRACTING
Pak Elektron Limited.

10. CERTIFICATION
Source: www.pel.com.pk
Pak Elektron Limited.

11. Sales & Marketing
PEL HEIRARCHI
Power Division
Manufacturing
EPC Contracting
Sales & Marketing
Director
Operations
Appliances
Division
Manufacturing
Chairman
Managing
Director
Finance /
Accounts
Finance
Supply
Management
QA&QC
HRD / IR&A
Internal Audit
Pak Elektron Limited.

12. Management Level s
at PEL
Pak Elektron Limited.

13. MISSION
VISION
VISION
“To excel in providing engineering goods and services through continuous
improvement.”
MISSION STATEMENT
To provide quality products & services to the complete satisfaction of our
customers and maximize returns for all stakeholders through optimal use of
resources.
To focus on personal development of our Human Resource to meet future
challenges.
To promote good governance, corporate values and a safe working environment
with a strong sense of social responsibility
Pak Elektron Limited.

14. Mission Statement Analysis
Mission Components
Included Not included
Description
Customers
●
Customers
Products and Services
●
To provide quality products
Markets
●
Technology
●
use of resources
Concern for Survival Growth and Profits
●
maximize returns for all stakeholders
Philosophy
●
Quality , customer care, good
governance, corporate values
Self-Concept
●
complete satisfaction of our customers
Concern for Public Image
●
strong sense of social responsibility
Concern for Employees
●
safe working environment with -
Pak Elektron Limited.

15. Mission Statement Evaluation
Key Variables
Case Facts
Evaluation
quality products & services,
Broad in Scope
complete satisfaction of our
Acceptable
customers
Length (Less than 250 words)
-
Acceptable
Inspiring
-
-
Identify the utility of the firm’s products
-
Mentioned
Reveal that the firm is socially responsible
Reveal that the firm is environmentally responsible
strong sense of social
responsibility
Mentioned
safe working environment
Mentioned
9 out of 9
Acceptable
Reconciliatory
-
Unspecified
Enduring
-
Unspecified
Include Nine Component
Pak Elektron Limited.

16. PEL Major Customers
Utility: WAPDA, PEPCO, KESC & AJK-ED.
TRANSCO: NTDC.
DISCOs:
TESCO, PESCO, IESCO, LESCO, FESCO
, GEPCO, MEPCO, SEPCO, HESCO &
QESCO.
GENCOs.
IPPs & RPPs.
Private customers.
Pak Elektron Limited.

17. External Factors By Umar Farooq
Pak Elektron Limited.

18. External Forces
• Economic Forces:
–
–
–
–
–
–
–
–
Devaluation of Currency
Interest Rate
Uncertain Economic Situation
Dumping Pricing.
Competition inside; China & Korea.
Competition outside; China, Korea, India & Turkey.
GST: 17%
Price Preference: 30% to the importing country.
Pak Elektron Limited.

19. External Forces
• Political, Legal & Govt. Forces:
–
–
–
–
–
–
–
–
–
–
Frequently Changes in tax laws
Unstable Political Environment
Energy Crisis
Local Rules: PPRA Rules.
International Rules: World Bank, ADB & JICA Rules.
“Lowest most responsive”.
No negotiations.
Bank Guarantee; 10% of Bid value.
Performance Guarantee; 10% of Purchase Order value.
Bound to Contractual agreements.
Pak Elektron Limited.

20. External Forces
• Technological Forces:
– New Products.
– Extended Services.
– New Emerging Markets.
– New Marketing methods.
– Supply Chain Management.
– Manufacturing Process & Techniques.
Pak Elektron Limited.

21. External Forces
• Social, Cultural, Demographic &
Environmental Forces are not effective.
• Competitive Forces:
– More than 50 competitors.
– New Entrants.
– Low pricing.
Pak Elektron Limited.

22. PORTER’S MODEL
Substitute Products (Medium)
Bargaining Power
of Suppliers (Medium)
Rivalry amongst
Competitors (High)
Bargaining Power
Of Consumers (High)
Potential Entry of new
Competitors (Low)
Pak Elektron Limited.

23. PORTER’S MODEL
Rivalry amongst competitors:
Modestly High
Potential New Entrants:
1 to 2 new competitors every year.
Suppliers Bargaining Power:
Medium; Depends upon
economy, source, time, demand, supply, transportation
mode and availability of raw material.
Pak Elektron Limited.

24. PORTER’S MODEL
Substitute Products:
A lot of registered companies having the product of
same specification or standard.
Buyers Bargaining Power:
Tender advertised in daily news paper.
Lowest most responsive bidder.
Bound to contractual agreements.
Pak Elektron Limited.

25. SWOT ANALYSIS
OPPORTUNITIES
Expansion of Energy Sector
Increase in Population
Large Product Range
Globalization
Joint ventures, merger, acquisition or take over
Pak Elektron Limited.

26. SWOT ANALYSIS
THREATS
Strong Competition
Chinese Products
Grey Market
Devaluation of Currency
Obsoletion of Technology
Rapid Changes in Government Policies
New Entrants
Pak Elektron Limited.

27. EFE Matrix
Key External Factors
Weight
Rating
Weighted Score
Expansion of Energy Sector
0.10
3
0.30
Increase in Population
0.05
2
0.10
Large Product Range
0.10
3
0.30
Globalization
0.04
3
0.12
Joint ventures, merger, acquisition or take over
0.05
2
0.10
Strong Competition
0.16
4
0.64
Chinese Products
0.10
3
0.30
Grey Market
0.04
1
0.04
Devaluation of Currency
0.10
3
0.30
Obsoletion of Technology
0.06
2
0.12
Rapid Changes in Government Policies
0.10
2
0.20
New Entrants
0.10
3
0.30
Totals
1.00
Opportunities
Threats
2.82
Pak Elektron Limited.

28. Internal Factors
By Farhan Saleem Roll # 28
Pak Elektron Limited.

29. Pak Elektron Limited.

30. Internal Factors
•
•
•
•
•
•
Management
Marketing
Finance and Accounting
Production Operation
R&D
MIS
Pak Elektron Limited.

31. Management Function
Performed at PEL
Planning
Defining goals, establishing strategies to achieve goals, developing
plans to integrate and coordinate activities.
Organizing
Team formation of each dept with the help of team leader
Arranging and structuring work to accomplish organizational goals
Leading
 Proper vision and direction of team leader
Working with and through people to accomplish goals.
Controlling
Monitoring, comparing, and correcting work
Pak Elektron Limited.

32. PEL
SWOT ANALYSIS
STRENGTHS
ERP Based Company
Strong Brand Image
Strong Dealer Network
Numerous Super Brand Award
State of the art plant
One of the largest manufacturer
Strong R&D Department
Strong After Sales Service
Compliance of International Standards
New Transformer Factory
Pak Elektron Limited.

33. PEL
SWOT ANALYSIS
WEAKNESSES
Financial Problem
Large overheads
High Prices
System Variation
Pak Elektron Limited.

34. IFE Matrix
Key Internal Factors
Weight
Rating
Weighted Score
Strong Brand Image
0.15
4
0.60
Strong Dealer Network
0.15
4
0.60
Numerous Super Brand Award
0.05
2
0.10
State of the art plant
0.10
3
0.30
One of the largest manufacturer
0.05
3
0.15
Strong R&D Department
0.05
3
0.15
Strong After Sales Service
0.05
3
0.15
Compliance of International Standards
0.10
3
0.30
Financial Problem
0.10
2
0.20
Large overheads
0.05
3
0.15
High Prices
0.10
2
0.20
System Variation
0.05
2
0.10
Totals
1.00
Strengths
Weaknesses
3.00
Pak Elektron Limited.

35. Market Analysis
By Umar Shahzad Roll # 17
Pak Elektron Limited.

36. Major Competitors of Appliances Products
1-Dawlance
2-Haire
3-Orient
4-Waves
Pak Elektron Limited.

37. Major Competitors of Power Products
1-Transformer:
2-Energy Meters:
3-Switchgear:
4-Power
Transformer:
5-EPC Project
substation, Rawalpindi
DHA substation Isld
Substations, in Nigeria
Pak Elektron Limited.

38. Market Analysis
Others
25%
PEL
29%
PEL
Siemens
Elmetec
Transfopower
Others
Siemens
15%
Transfopower
21%
Elmetec
10%
Pak Elektron Limited.

39. BCG MATRIX
Question Mark
High
Power Transformers
Refrigerator
Instrument Transformer
Water Dispenser
Floor Standing
Cash Cow
Low
Market Growth
Distribution Transformers
Dog
Energy Meters
Switchgear Panel
Split AC
Generators
Washing Machine
High
Low
Market Share
Export Marketing-PEL
Pak Elektron Limited.

40. PRODUCT LIFE CYCLE
PEL Company
PEL Transformers
Sales and
Profits
Development
Sales and
Profits
Introduction
Growth
Maturity
Decline
Time
Development
Introduction
Growth
Maturity
Decline
Time
Export Marketing-PEL
Pak Elektron Limited.

41. Financial Analysis
By Sajjad Zafar Pirzada Roll # 52
Pak Elektron Limited.

42. FINANCIALS
•
•
•
•
Gross Sales
Gross Sales:
Net Sales:
Gross Profit:
Net Profit:
Rs. 20.3 Billion.
Rs. 17.7 Billion.
Rs. 3.60 Billion.
Rs. 0.12 Billion.
11%
Power
Division
Applianc
es
Division
89%
Pak Elektron Limited.

43. FINANCIALS
Pak Elektron Limited.

44. FINANCIALS
Pak Elektron Limited.

45. FINANCIALS
Pak Elektron Limited.

46. FINANCIALS
Pak Elektron Limited.

47. FINANCIAL ANALYSIS
Summary of the Liquidity Ratio Comparisons
Ratio
PEL
Industry
Current
1.32
1.26
Acid-Test
0.82
0.88
> Strong current ratrionand weak acid test ration
indicates a potential problemin inventories account.
> Note that PEL has a relatively high level of inventories.
Pak Elektron Limited.

48. FINANCIAL ANALYSIS
Summary of the Liquidity Trend Comparisons
> The current ration for PEL has been declining & slowly rising
at the same time acid test ratio first declining and slowing rising.
> The current ration for Industry has been declining & slowly rising
at the same time acid test ratio first declining and slowing rising.
> This indicates inventories are a problem for PEL
Pak Elektron Limited.

49. FINANCIAL ANALYSIS
Summary of the Profitability Ratio Comparisons
Ratio
PEL
Industry
Gross Profit Margin
22.8%
16.9%
Net Profit Margin
1.8%
2.8%
Return on Investment
1.5%
3.5%
Return on Equity
6.8%
13.7%
> PEL profitability ratios have ALL been falling since 2007.
Each except Gross Profit Margin below the industry average
for the past three years.
> This indicates that COGS and administrative costs may
both be too high and a potential problem for PEL.
> Note, this result is consistent with the low interest
coverage ratio.
Pak Elektron Limited.

50. FINANCIAL ANALYSIS
Summary of the Financial Leverage Ratio Comparisons
Ratio
PEL
Industry
Debt to Equity
2.07
2.29
Debt to Assets
0.44
0.58
Total Capitalization
1.09
1.77
> PEL debt utilization and assets supports to debt relative
to industry is low.
> PEL long term debts also less than industry.
> That shows PEL debts utilization possition is very low
as compare to industry.
Pak Elektron Limited.

51. FINANCIAL ANALYSIS
Summary of the Financial Leverage Trend Comparisons
> PEL debt utilization tred stuck down as compare to
industry and than slowly rise.
> PEL assets support to debt financing is slowly down but
much down as compare to industry.
> PEL long term debt utilization trend also down.
Pak Elektron Limited.

52. FINANCIAL ANALYSIS
SUMMARY OF RATIO ANALYSIS
1. Inventories are too
hihg.
2. A burden of financial
charges.
3. May be paying off creditors too
soon.
4. Selling , general and administrative costs may be
too high.
5. Less adminstrion performance.
6. Very poor profitability rates.
Pak Elektron Limited.

53. Strategies/Objectives
By Muhammad Umar Farooqi Roll # 145
Pak Elektron Limited.

54. Pak Elektron Limited.

55. Defined
Goals at PEL
Financial Goals
Target of reducing financial cost from 13%
Strategic Goals
Increase profitability and sales turnover
Increasing the product line
Pak Elektron Limited.

56. Plan at PEL
Strategic Plans
 Capture 10% more market share within next 2 years.
 To become the leading manufacturer of electrical goods in
Pakistan.
Operational Plans
 Introduce a wide range of Products.
 To achieve the desired targets with cost cutting
techniques.
 Efficient utilization of resources to maximize output.
Pak Elektron Limited.

57. Contemporary Issues
in Planning at PEL
Criticisms of Planning
 Main flaw in today's planning lies with the energy crisis
prevailing in the country.
 Due to its dynamic nature the changes in plans are very
frequent.
Effective Planning in Dynamic Environments
 Different plans including sales and production plans need to
be changed very often and is an ongoing process.
 Need to cater to market trends while planning and therefore
being static or fixed is of no use.
Pak Elektron Limited.

58. Objective
Strategic:
Increase our Export
Increase in production plant capacity
Retain local market share.
Lower production cost, not effecting the
quality.
Change in internal design.
Superior on time delivery
Superior customer services.
Pak Elektron Limited.

59. Objective
Financial:
Lower factory overheads.
Minimize liquidated damages on late
delivery.
Maximize profits.
Pak Elektron Limited.

60. Recommendations
1. They should retire their expensive loans.
2.They should carefully study their competitors.
3.As mentioned earlier company’s liquidity position is dismal. So they need to
pay off their short term loans.
4.Their operating cost is very high so they should control their operating
expenses.
5.There should be a continuous monitoring of performance. When performance
deviates from plans one does not have to wait for the next periodic review to
correct it. The supervisor and subordinate should discuss the situation
immediately so the corrective actions can be taken at once in order to avoid the
major disasters.
6.Whether performance appraisal discussions are held monthly, quarterly,
annually appraise should be clear about what he/she is doing right and wrong
,and how he/she can overcome there deficiencies for the future appraisal.
7. Performance appraisal should be conducted in a way that employee should
not perceive it as a fatigue or threat for there job but it should take it as an
opportunity to add or contribute more value in work of there organization
Pak Elektron Limited.

61. Distribution Transformer Plant
Pak Elektron Limited.

62. Pak Elektron Limited.

63. Pak Elektron Limited.

64. Question and Answer
Pak Elektron Limited.

65. References
•
•
•
•
www.pel.com.pk
www.wikipedia.com
www.slideshare.com
https://www.google.com.pk
Pak Elektron Limited.