This document discusses portfolio analysis using the Boston Consulting Group (BCG) matrix. It begins by explaining the product life cycle and components of the BCG matrix including stars, cash cows, dogs, and question marks. It then provides examples of how the BCG matrix can be applied to analyze the product portfolios of ITC Ltd. and Maruti Suzuki. The document concludes by noting some limitations of only considering market growth rate and relative market share in the BCG matrix.

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.
Introduction Growth Maturity Decline
Product
Few
products
More
product/Mor
e features
differentiation
important
Reduced
Price High/Low
Based on
demand
price
reduction
Low
Distribut
ion
Selective
More
intensive
new channels Selective
Promoti
on
Building
awareness
sales is
target
brand loyalty Low

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. STAR ? ? ?
Cash Cow Dogs
Low
Low
High
High
Market
Growth
Rate
Relative Market Share
Cash
Usage
Cash Generation

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. STAR
Hotels, papers,
Agri business
? ? ?
Agarbatti,
Cloths
Cash Cow
Cigarettes, FMCG
Dogs
Infotech
Low
Low
High
High
Market
Growth
Rate
Relative Market Share
Cash
Usage
Cash Generation

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. STAR
SWIFT, ZEN
ESTILO, DESIRE
? ? ?
SX4, GRAND
VITARA, A STAR
Cash Cow
800, ALTO,
WAGON R
Dogs
BALENO, VERSA,
OMNI
Low
Low
High
High
Market
Growth
Rate
Relative Market Share
Cash
Usage
Cash Generation

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.