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MARKETING ANALYSIS
ON
Submitted in partial fulfilment of the requirement for the award of
Bachelors of Business Administrative
(BBA)
Made By: Under Guidance of:
Mrinal kakkar Ms. HIMANI GROVER
BharatiVidhyapeethUniversity
School of Distance Education
Academic Study Centre- BVIMR, New Delhi
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ACKNOWLEGEMENT
Project work is never the work of an individual. It is more a combination of
ideas, suggestions, and contribution and work involving many jobs. One of the most
important parts of writing a report is the opportunity to thank all those who have
contributed to it. The list of expression of thanks, no matter how extensive, is alwaysincomplete and inadequate. This acknowledgement is no exception.
I want to express my sincere gratitude towards Ms HIMANI GROVER who
provided me with her expert guidance and invaluable suggestion.
I would like to thank my classmates and all those who directly or indirectly
helped me in one or the other way in the successful completion of the project.
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TABLE OF CONTENT
CHAPTER 1: INTRODUCTION OF COMPANY:-
1.Nature of business.2. Types & ownership pattern.3. Organization structure.4.Production structure.5. Organizational strategies.
CHAPTER 2: INDUSTRIAL ANALYSIS:-
1.Industry overview :- (Growth rate of industry, contribution to GDP).2. Current Issues :- (From newspaper, Journals-for company and
industry).
3.Key competitors.4.Environment scanning:-political environment, economic
environment, socio-cultural environment, technological
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environment, environmental issues (Green environment) and legal
environment.
5.Porters five forces model of competition-Michael Porter.
CHAPTER 3: MARKETING STRATEGIES:-
1.Products of company.2. 4Ps (Product, Price, Place & Promotion).3.STP (Segmentation, Targeting and Positioning).4.
Distribution channels.
5.Promotion strategies.
CHAPTER 4: FINANCIAL ANALYSIS:-
1.Sources of finance.2.Ratio analysis Any 5.3.Net profit/balance sheet (from annual report) Analyses.
CHAPTER 5: KEY LEARNINGS FROM THE COMPANY AND
RECOMMENDATIONS:-
1.Performance Analysis of the Company.2.Market share/growth rate of company.3.SWOT Analysis of the Company.
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CHAPTER 6: Findings
CHAPTER 7: Conclusions and Suggestions
Bibliography
Reference Books, Journals, Newspapers, Web Sites, Reports etc. are to be
listed out here.
CHAPTER 1: INTRODUCTION OF COMPANY:-
1.Nature of business.2. Types & ownership pattern.3. Organization structure.4.Production structure.5. Organizational strategies.
INTRODUCTION
Videocon Industries Ltd. was one of the initials companies that made it to the World.
Videocon Electricals captured the initial Indian Electrical market and topped the charts for its
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products such as Refrigerators, television etc. before other players such as Samsung,
Whirlpool etc .entered Indian market. Videocon was one of the first Electronic Company to
Collaborate with Japanese Toshiba Ltd as early as 1985.
It is one of the biggest Indian Electrical brands not only in India but also globally. Indeed,
Videocon is one of the fastest paced Electrical Products worldwide. Videocon thus posed an
exciting opportunity to study a brand that is automatically associated with youth and
technology.
Videocon deems it a privilege that it is in a position to prolong instances of joy and spirit.
And lend muchneeded variety and flair in everyone's life.
An Indian multinational, a global force in display technologies and a group on the threshold
of even bigger things.There are new horizons to breach, new frontiers to conquer and simply
no pause buttons on the Videocon play. Expect the unexpected, the uncharted and the
unlimited.
NATURE OF BUSINESS
Manufacturer & Exporter of Conventional Colour TV and LCD TV Receiver Sets, D2h
Set Top Box, VCD/MP3 Players, Air Coolers, Music Systems, Airconditioners, Home
Theaters like Refrigerators, Automatic & Semi Automatic WashingMachines, Dish Washers,
Microwave Ovens, Mixer, Grinders and Water Purifier like TV, DVD/MP3 & Audio
Components, Glass Shells for Colour Picture Tubes, Populated PCBs, Tunners, Monitors for
Computer, Compressors and other Electronic Assemblies and Sub-Assemblies like Digital
Diaries, Kiddy PC, Data Projector, Power Inverter, Digital MP3 Player and Palm Top like
ISP, Content and Web Solutions. Crude Oil Extraction 50000 Barrels per Day.
1050MW Power Generation. Videocon LCD TV, Videocon Air Conditioners, Videocon
Refrigerators, Videocon Washing Machine.
Type and Ownership Pattern
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Consumer Electronics, Home Appliances & Compressor manufacturing in
India
Videocon enjoys a pre-eminent position in terms of sales and customer satisfaction in many
of our consumer products like Color Televisions, Washing Machines, Air Conditioners,
Refrigerators,M
icrowave ovens and many other home appliances, selling them through aMulti-Brand strategy with the largest sales and service network in India. Refrigerator
manufacturing is further supported by our in-house compressor manufacturing technology in
Bangalore. Videocon has the largest distributed manufacturing base across India 12
facilities. It has the Capacity to manufacture 4 million CTVs, 2.5 lacs washing machines, 1
mn. DVD players, 4.8 mn refrigerators.
Displayindustry anditscomponents
With the Thomson acquisition Videocon has emerged as one of the largest Color Picture tube
manufacturers in the world operating in Mexico, Italy, Poland and China, continuing to lead
through new innovative technologies like slim CPT, extra slim CPT and High Definition 16:9
format CPT.
ColorPictureTubeGlass
Videocon is one of the largest CPT Glass manufacturers in the world with a high level of
experience and technical expertise operating through Poland and India. Videocon will
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leverage on this synergy after the Thomson acquisition to internally source glass for its CPT
manufacturing increasing efficiencies and lowering costs.
Oil and Gas
An important asset for the group is its Ravva oil field with one of the lowest operating costs
in the world producing 50,000 barrels of oil per day. The group has ambitious plans for
expansion in this sector globally.
LOGO LOGIC
This is the new Videocon symbol. It reiterates the ethos of a company dedicated to
maintaining the highest international standards of excellence through quality, technology and
innovation. For over a decade now, Videocon has been bringing the latest and very best in
Consumer Electronics and Home Appliances. Successfully adapting the best of
internationaltechnology to suit Indian needs, and crafting it to improve the quality of life as
million of satisfied customers will agree.
The new symbol of Videocon asserts its passion for global impact, and the two Es on either
side represent the Groups wide spectrum of interests ranging from Electronics to Energy.
Along with the steely glint, this communicates the group's global ambition, its strength,
sterling credentials and innovative drive. A symbol that proclaims a paradigm shift.A sign
that represents the new force that is Videocon.Thus recapitulating our principle of reaching
out and touching the lives of millions of people Worldwide.
OWNERSHIPPATTERN
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Sr.
NoCategory of shareholder
Number of
shareholders
Total number
of shares
Number of shares
held in de
materialized form
As a %
of (A+B)
As a % of
(A+B+C)
(A)Shareholding of Promoter and Promoter Group
(1) Indian
(a) Individuals/ Hindu Undivided
Family
13 1619838 1292950 0.87 0.73
(b) Bodies Corporate 44 153823583 152711452 82.6 69.57
Sub-Total
(A)(1)
57 155443421 154004402 83.47 70.3
(2) Foreign
(a) Individuals (Non- Resident
Individuals/ Foreign Individuals)
0 0 0 0 0
(b) Bodies Corporate 0 0 0 0 0
(c) Institutions 0 0 0 0 0
(d) Any Other (specify) 0 0 0 0 0
Sub-Total
(A)(2)
0 0 0 0 0
Total Shareholding of
Promoter and Promoter Group
(A)=
(A)(1)+(A)(2)
57 155443421 154004402 83.47 70.3
(B) Public shareholding
(1) Institutions
(a) Mutual Funds / UTI 21 36571 35228 0.02 0.02
(b) Financial Institutions/ Banks 36 304403 291166 0.16 0.14
(c) Insurance Companies 5 5600352 5599752 3.01 2.53
(d) Foreign Institutional Investors 95 13467563 12706367 7.23 6.09
Sub-Total
(B)(1)
157 19408889 18632513 10.42 8.78
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(2) Non-institutions
(a) Bodies Corporate 1927 5516620 4962476 2.96 2.5
(b) Individuals
(i) Individual Shareholders holding
nominal share capital up to Rs. 1
lakh
342862 4685290 2998613 2.52 2.12
(ii) Individual Shareholders holding
nominal share capital in excess
of Rs. 1 lakh
19 1171618 1171618 0.63 0.53
(c) Any Other (specify) 0 0 0 0 0
Sub-Total(B)(2) 344808 11373528 9132707 6.11 5.15
Total Public Shareholding (B)=
(B)
(1)+(B)(2)
344965 30782417 27765220 16.53 13.93
TOTAL(A)+(B) 345022 186225838 181769622 100 84.23
(C) Shares held by Custodians and
against which Depository
Receipts have been issued
2 34867863 34862403 0 15.77
GRAND TOTAL
(A)+(B)+(C)
345024 221093701 216632025 100 100
Organisational structure of Videocon
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Production structure
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Cost cutting Videocon was better positioned to shift the activities to low-cost locations and
also it could integrate the operations with the glass panel facility in India with the CPT
manufacturing facilities acquired from Thomson S.A. Videocon wanted to leverage its
position in the existing parts of the business and this acquisition would give it a strong
negotiation position and could reduce impact of glass pricing volatility. Videocon could also
reduce the costs by upgrading and improving the existing production lines.
Vertical Integration The acquisition helped Videocon in vertically integrating its existing
glass-shell business where it had been enjoying substantially high margins.[8] Videocons
glass division had the largest glass shell plant in a single location. This gave the company an
unrivalled advantage in terms of economies of scale and a leadership position in the glass
shell industry. The acquisition also gave Videocon a ready-market for its glass business and it
was part of Videocons long-term strategy to have a global vertically-integrated
manufacturing facility.
Rationalization of Product Profile Videocon modified its product profile to cater to thechanging market needs like moving away from very large size picture tubes to smaller ones.
Apart from the overall strategy Videocon also had a plan on the technological front. It wanted
to improve the setup for the production line and line speed post-merger. Its focus was to
increase sales while reducing the costs and thereby improving the productivity of the existing
line. The company also wanted to foray in a big way into LCD panels back-end assembly. On
the sales front the company wanted to leverage on the existing clients of Thomson and build
relation as a preferred supplier to maximise sales. Also, Videocon could benefit from OEM
CTV business with the help of Videocons CTV division, invest for new models and
introduction of new technologies.
Videocon has not been able to turn the plant around in Italy still. However it is getting
support from the local governments (which want to prevent job cuts) in form of grants. The
government is in fact trying to set up a Greenfield venture in form of a LCD manufacturing
facility in partnership with Videocon. The banks are also supporting Videocon and with help
from all these quarters Videocon expects to turn around the plant in Italy.[13] The Thomson
plant has not turned around in Mexico as well and in fact production has been reduced over
there.InPoland,the situation is more promising and Videocon hopes that plant over there will
get in black in the very near future.[14] However the surprise has been in the Chinese market
.Despite facing a highly competitive market Videocon has managed to turn a plant around
while the other is on its way. In China Videocon is adopting a different strategy for
manufacturing CTVs as the local players dominate the market .It plans to supply these players
by taking advantage of low-cost nature of mainland(the number targeted by it about 6 million
CPT,s)
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VIDEOCON STRATEGIES
y Multi-brand strategy
Videocon International was the first Indian company to adopt the strategy of multi-brands.
Apart from its mid-priced brand Videocon, the company now hawks Toshiba, a premium
brand, and the low-priced brands Akai and Sansui. The multi branding technology paid off as
Videocon managed to hold on to a combined market share of around 19.6 percent, with LG at
25.9 percent and Samsung at around 13.8 percent.
Overall, the shift in the power to trade is probably one of the defining developments. It is
important since the TV companies themselves have taken it seriously and embarked on
crafting longer-term strategies to accommodate this development. The effectiveness of their
strategy and the responses of the other players promise to deliver a few more years of
enterprising developments in the Indian TV market.
y Backward Integration
Videocon integrated backwards by getting into manufacture of components such as electron
guns, metal parts and deflection yokes for CTVs and compressors, and electric motors and
plastic components for households appliances such as washing machines, refrigerators and
Air conditioners. The group integrated further to get in to manufacture of glass panels and
funnels, the key components for the manufacture of color picture tubes.
Videocon enjoys a unique synergy in the global CTV business from glass to CRT (Cathode
Ray tubes) to CTVs. - (From Sand to CTV). Together with other components for householdsappliances. This high degree of backward integration bestows upon the company a unique
benefit over competition.
y Videocon's Revenue mix
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Performance Measures
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CHAPTER 2: INDUSTRIAL ANALYSIS:-
1.Industry overview :- (Growth rate of industry, contribution to GDP).2. Current Issues :- (From newspaper, Journals-for company and
industry).
3.Key competitors.4.Environment scanning5.Porters five forces model of competition-Michael Porter
Industry overview
COMPANYS PROFILE
Today the group operates through 4 key sectors:
Consumer Electronics, Home Appliances & Compressor manufacturing in India
We enjoy a pre-eminent position in terms of sales and customer satisfaction in many of our consumer
products like Colour Televisions, Washing Machines, Air Conditioners, Refrigerators, Microwave
ovens and many other home appliances, selling them through a Multi-Brand strategy with the largest
sales and service network in India. Refrigerator manufacturing is further supported by our in hous
compressor manufacturing technology in Bangalore.
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Display industry and its components
With the Thomson acquisition Videocon has emerged as one of the largest Colour Picture tube
manufacturers in the world operating in Italy, Poland and China, continuing to lead through ne
innovative technologies like slim CPT, extra slim CPT and High Definition 16:9 format CPT.
Colour Picture Tube Glass
Videocon is one of the largest CPT Glass manufacturers in the world with a high level of experience
and technical expertise operating through Poland and India. Videocon will leverage on this synergy
after the Thomson acquisition to internally source glass for its CPT manufacturing increasing
efficiencies and lowering costs.
Oil and Gas
An important asset for the group is its Ravva oil field with one of the lowest operating costs in the
world producing 50,000 barrels of oil per day. The group has ambitious plans for expansion in this
sector globally.
Current issue of Videocon
Videocon V1688 Twist & Turn available in market
Description:
Videocon V1688 Twist & Turn is the new stylish and well designed mid-range mobile phone by
Videocon which has just been launched in the market. The mobile comes loaded with lots of attractive
and impressive features as well as dimension. This mobile is priced at Rs. 6,995/- in Indian market
which is affordable than othermobiles having same features.
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Videocon V1688 Twist & Turn is the 90 degree roted full QWERTY keyboard impressive mobile
phone that has 3.2 inches touchscreen display screen. This display screen of the device generates
resolution of 320x480 that shows pictures of better quality.
This amazing designed mid-range mobile has all the music features such as MP3 andMP4 with
formats of 3GP, AVI, RMVB video etc. It is boasted with a 2 mega pixel of camera that can capture
photographs at resolution of 1600x1200 pixels and video recording at format of 3GP and 15fps. It is
also loaded with dual speakers for loud music and a 3.5 mm audio jack.
The mobile supports Java language, EDGE & GPRS and stereo Bluetooth streaming (A2DP), while
comes pre-loaded of popular social networking sites likeMSN, Yahoo, Facebook and Skype. The
mobile comes pre-installed a 2GB microSD while its memory can be upgraded up to 4GB through
using a memory card.
The mobile, Videocon V1688 Twist & Turn, supports dual SIM (GSM+GSM) that provides excellent
networking facility. This impressive handset is corporated with a solid 1000 mAh battery that allows
long talk and standby time. The mobile is available in Red, Yellow and Silver colour shades.
Important Competitors
LG ELECTRONICS
LG Electronics rightly understood the consumer motivations to create magnetic
products, price them strategically, position them sharply and keep making the
magnetism more potent. Having understood the finer differences in consumer
motivations, it opted for sharp- arrow reasons-to-buy differentiation over the
blanket-all approach taken by most of the other players. It is an aggressiv
marketer. It focuses on low and medium price products.
SAMSUNG
Initially the strategy of Samsung in India was to create premium image by
emphasising global brand. After facing stiff competition from another Korean major-
LG, Samsung also started playing price game. In 2004 it reverted back to its premiu
positioning, although it resulted in some loss of market share. In line with the Global
Digital Initiative of the Parent Company, Samsung India is seeking to acquire digital
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leadership in India by introducing its digital ready televisions like the 40" LCD
Projection TV, 43" Projection TV and the Plano series of Flat Colour televisions.
ONIDA
Its popular devil ad although had engendered a strong emotional pull towards the
brand, technologically it represented no advancement. The company plugged the gapby touting its digital technology. Like Videocon, it has also been able to hold its
market share. The world-class quality of Onida has enabled the company to make a
breakthrough on the export front. It has technical tie- up with the Japan Victor
Company, better known as JVC. So focused is Onida on positioning itself on the
premium, high- tech plank that it is even planning to push its own envelope on
obsolescence, much. The strategy is aimed at further broad basing the produc
offering of the company, which has largely dominated the top-end of the television
market, across multiple market segments.
VIDEOCON
Videocon has always been a price player and has an image of a low price brand. Thi
entails providing more features at a given price vis--vis competitors. It has taken
over multinational brands to cater to unserved segments, like Sansui- to flank the
flagship brand Videocon in the low to mid priced segment, essentially to fight agains
brands like BPL, Philips, Onida and taken over Akai- tail end brand for brands like
Aiwa.
Videocon is one of the largest manufacturers of television and its components in
India and thus has advantages of economies of scale and low cost due to
indigenisation. It has the widest distribution network in India with more than 5000
dealers in the major cities. It also has a strong base in the semi-urban and rural
markets. Due to its multi-brand strategy, it has at present multiple brands at the same
price point. This has led to a state of diffused positioning for its brands. It has also le
to a cannibalisation of sales among these brands. The flagship brand Videocon has
lost market share due to the presence of Sansui in the same segment. Because o
reduction in import duties on CPT the cost advantage of Videocon is also on the
decline. Hence it is facing rough weather and also trying to boost exports.
Besides understanding the strategy adopted by different players, several other factors-
industry growth, concentration and balance, corporate stakes, fixed cost, and product
differences need to be analysed to determine the extent of rivalry between th
existing Players.
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ENVIRONMENTAL SCANNING
PEST ANALYSIS
1. Political Factors
y Labour unions effects a lot the production
y Resolution to reduce emission of carbon footprints in the atmosphere
y Anti-dumping duty on imported color picture tubes
2 . Economical Factors
y Growth of retail sector expected to reach 16% by 2011-12from 4% in 2007
y
High investments are needed in the consumer durables
y Emergence of organized retail market with large players likeCroma, Next, Reliance
Digital - leading to lower prices and higher varieties
3 . Social Factors:
y Changing perception of luxury to necessity
y In rural areas there is poor infrastructural facilities likeavailability of electricity
y Demand of the consumer durables is seasonal and cyclic
y Highly growing consumer durable market
4 . Technological Factors:y Improved electricity consumption
y Higher quality products
y Technological is changing at a very fast rate
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PORTERS MODEL
In order to understand the industry better, we analyze the industry using Porters Five Force
Model-
- Threat to entry
- Rivalry of among existing firms
- Bargaining power of buyers
- Bargaining Power of Suppliers
- Threat of Substitutes
Suppliers
(Supplier
Power)
Potential entrants
(Threat of
Entry)
Industry
Competetitors
(Segment rivalry)
Substitutes
(Threat of
substitutes)
Buyers
(Buyer
Power)
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Threat to Entry-
y Entering the CTV market isnt very easy. One of the most important features needed
is a good distribution system which isnt something that can be developed overnight.
y Also a television today is a style statement. Therefore the brand plays an important
role in influencing the purchase decision. For a new company then entering this
market, not having a recognized brand name is a threat to entry.
Rivalry among existing firms-
y There is strong competition among the current players. The main players being LG,
Samsung, Onida, Videocon, Philips, Sansui. Some of the regional players are-
Hyundai and Haier are new entrants in the CTV space in addition to a number of
small regional players.
y This increased competition has ensured that advertising costs are an integral part of
the players total cost. A lack of product differentiation means that price is a
competitive feature that intensifies rivalry. The highest price reductions during 2002-
03 to 2005-06 were in the 20inch and 21inch CCTV category.
y With the future being in LCDs, this market is likely to see price reductions future.
y It is expected that realizations will fall with increased competition.
Bargaining Power of Buyers-
y The TV market today is a consumers market where the consumer has the upper hand
with him having the power of choosing from a variety if brands.
y This bargaining power of the buyer has forced the players to offer credit facilities on
sale, to provide lower EMIs and excellent after-sales service.
y The intense dealer competition also benefits the consumer in terms of prices and
offers available.
y Inventory carrying costs for television companies are high. This is a boon for the
consumers as it translates into higher bargaining power for the consume
Threat of Substitutes-
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y For a television, the substitute can only be a functional substitute. The functional use
of a television is to watch programs, live events etc. This today can also be done on a
computer.
y Theaters too can be a substitute to watching movies at home.
y Today with various multiplexes and theaters providing screenings of live events such
as sports telecasts etc along with the luxury of good food and the opportunity to enjoy
the event with a number of other enthusiasts, the TV can be substituted if the TV is
bought only to watch certain events.
y However if the television on considered to be a style statement and a lifestyle
statement, then consumers will seek to keep upgrading the type and the model of their
television sets.
Bargaining Power of Suppliers-
y PCBs (Printed Circuit Boards) & CRTs (Cathode Ray Tube) are key raw materials in
the production of CTVs.
y CRT accounts for 46-48 per cent of the total raw material costs of a CTV. PCBs and
housing components account for 33-39 per cent of total raw material costs.
y Domestic CPTs prices tend to follow Global price trends. Therefore the suppliers do
not have much of bargaining power in this regard.
y Cabinets are sourced from plastic manufacturers and as these manufacturers supply to
different industries, they therefore do have a bargaining power, especially in
comparison to CRT suppliers.
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CHAPTER 3: MARKETING STRATEGIES:-
1.Products of company.2. 4Ps (Product, Price, Place & Promotion).3.STP (Segmentation, Targeting and Positioning).4.Distribution channels.5.Promotion strategies
1.Products of company
CONSUMER ELECTRONICS
PLASMA
SPILT AC
WINDOW AC
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MOBILE PHONES
WASHINGMACHINE
REFRIGERATOR
HOME THEATER
MICROWAVE
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DISH TV
LCD TELEVISION
4Ps
The 4Ps includes the Product, Price, Place and promotion.
Product Mix
Product mix is the set of all product and items a particular seller offers for sale. Product mix
consists of various product lines.
The width of a product mix refers to how many different product lines the company carries.
The Videocon television has product mix width of five lines. I.e. plasma, LCD, Slim, flat and
Conventional.
The length of a product mix refers to the total number of items in the mix.
i.e. for the line of LCD the length is 2 as it has two items 50 PDP and 42 PDP.
The depth of the product mix refers to how many variants are offered of each product in the
line, i.e. For LCD the depth will be 2. As Videocon is offering only one product in 50 PDP
and 42 PDP.
The three product-mix dimensions permit the company to expand its business in three
ways.
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y It can add new product lines, thus widening its product mix.
y It can lengthen each product lines.
y It can add more product variants to each product and deepen its product mix.
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Width, Length & Depth
Width = 5 (Plasma, LCD, Slim, Flat, Conventional)
In the product mix of Videocon, it is having 37 different models, which gives them their
product line Depth.
PLASMA
Plasma television technology is similar to the technology used in a fluorescent light bulb. The
display itself consists of cells. Within each cell two glass panels are separated by a narrow
gap in which neon-xenon gas is injected and sealed in plasma form during the manufacturing
process.
The main advantage of Plasma over CRT technology is that, by utilizing a sealed cell with
charged plasma for each pixel, the need for a scanning electron beam in eliminated, which, in
turn, eliminates the need for a large Cathode Ray Tube to produce video images. This is why
traditional televisions are shaped more like boxes and Plasma televisions are thin and flat.
Advantages of Plasma Television:
y Largest Screen Formats.
y Superior Contrasts.
y Versatile.
Plasma LCD Slim Flat Conventional
50PDP42 LCD 29 slim 29 flat 21 FFST
42PDP32 LCD 21 slim 21 flat 20conv
26 LCD 15 flat 14conv
20 LCD
19 LCD
Length 5 2 3 3
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y Capable Of Displaying Full HDTV &Dtv Signal.
y Capable Of Displaying Xga, Svga&Vga Pc Signal.
y Wide Viewing Angle.
y Wide Rage Of Richer Color Over 16 Million.
y
Superb Realistic Images.y Less Expensive Than Lcds.
y LifeMore Than 30,000 Hours.
y Wide Screen Aspect Ratio around 16:9.
y Perfect Flat Screen.
y Uniform Screen Brightness.
y Slim & Space Saving Design.
50"PDP
Integra 50
10000:1 Contrast Ratio
3:2 & 2:2 Pull Down
HDMI Compatible
3-D Video Noise Reduction
PC Input
42"PDP
16.77 Million Color
10000:1 Contrast Ratio
3.2 & 2:2 Pull Down1500cd/m
2Brightness
HDMI Compatible
3-D Video Noise Reduction
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LCD
The flabs are out and now technology has switched over to sleek and slim products, LCD
being the prominent amongst them. LCD technology is the recent breakthrough in consumer
electronics and because of its esteemed advantages this segment is growing day by day.
Videocon are launching this range under the sub brand Integra. INTEGRA term indicates
the integration of various systems connectivity with LCDTV.
This is an integration of best sound quality and excellent picture quality.
What is TFT-LCD?
Meaning of this term is Thin Film TransistorLiquid Crystal Display. TFT technology used in
this category offers the best image quality in flat panels. This technology is also called as
ActiveMatrix Technology.
40"
LCD,32"
LCD,26"
LCD, 20" LCD, 19" LCD
Slim
WithContinuousResearch&Development,Videocon brings a revolutionary advancement in
physics & brings new Slim & Trim Television.
The Most significant feature of the Slim & Trim Television is its one kind of super slim
picture tube technology. This has enables us to make the TV 42% Slimmer.
Slim Picture tube is a product with reduced depth providing the TV and monitor producers
with opportunity to design Slim, flat and stylish TVs comparable to plasma or LCD panels
maintaining Good picture Quality
29" SLIM
21" SLIM
Flat
Videocon Bada Woofer with Surrounds Bass Technology
Bass Amplification by Dynamic Alignment (BADA) woofer is a revolutionary technology
that offers a new sound to create an unbelievable sound space
Videocon unique Bazoomba Woofer Technology
Videocon's superior Bazoomba Woofer Technology incorporates a unique conjugate
arrangement of Woofer motors that ensures rich bass reproduction.
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The Bazoomba Woofer Technology
Enables the generation of the lowest bass frequencies from a small enclosure (Bazoomba
tube). Enables cleaner and tighter bass reproduction due to acoustic cancellation of distortion
in the even harmonics
29" TFT
21" TFT
15" TFT
Conventional TV
21" FFST
20" CONV
14" CONV
Pricing
The pricing of the Videocons various models is as following.
Plasma TV : Rs. 59,990 - 2, 40,000
LCD TV : Rs. 28,400 89,900
Slim TV : Rs. 10,400 18,900
Flat TV : Rs. 5,500 18,400
Conventional TV : Rs. 4,600 - 9,500
Place
Videocon has its presence all throughout India.
They have their presence in 25 states and each state has at least 2 divisions per state. In total
they are having 78 divisions.Videocon has around 1800 dealers in India. They are having 96
service centers across India.
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Promotional Activities
Focusing on LCD, Plasma and 29 Flat TVs since 2006.
By institutional selling. Company used both TVC as well as print media for promotion. The
company is using outdoor media promotions in hording and bus shelters to high light the
feature packed advantages.
Major tie ups in the background IIT alumni/ Videocon Santos ham film awards 2006 with
ZEE and ICC Cricket champions trophy.
Seasonal offers
Trip to Germany during FIFA world cup
Videocon bonanza offer ( har din diwali) during diwali
Chance to win car, motor bike and LCD TV'
SEGMENTATION, TARGETING & POSITIONING
(STP)
SEGMENTATION:
Market segmentation is the process in marketing of dividing a market into distinct subsets
(segments) that behave in the same way or have similar needs. Because each segment is fairly
homogeneous in their needs and attitudes, they are likely to respond similarly to a given
marketing strategy. They are likely to have similar feelings and ideas about a marketing mix
comprised of a given product or service, sold at a given price, distributed in a certain way and
promoted in a certain way.
The process of segmentation is distinct from targeting (choosing which segments to address)
and positioning (designing an appropriate marketing mix for each segment). The overall
intent is to identify groups of similar customers and potential customers; to prioritize the
groups to address; to understand their behavior; and to respond with appropriate marketing
strategies that satisfy the different preferences of each chosen segment.
Segments based on Income
Plasma: Income group of more than 50,000
LCD: Income bracket of Rs 20,000 and above
Slim: Consumer in the income bracket of Rs 9000-15000
Flat: Consumer in the income bracket of 7000-12000
Conventional: income bracket of Rs 3000-6000
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Segments based on social class
Plasma: rich class
LCD: upper middle class and rich class
Slim: middle class
Flat: middle and lower middle class
Conventional: lower economic class.
Benefit Segmentation:
Conventional, Flat screen Slim, LCD, and Plasma can also segmented on the basis of benefits
that an end consumer would receive from them.
User Status:
TV market can be classified into non users of TV and potential users in term of graduating to
a higher segment like slim, LCD,Plasma from basic conventional TV.
Loyalty status:
On the basis of Loyalty status
Hardcore Loyal: brand loyal to Videocon for a long time in terms of purchasing products of
VideoconShifting Loyal: who shift loyalty from other brands to another
Switchers: not loyal to any brands so attract them to Videocon and convert they brand loyal.
TARGETING:
Once the firm has identified its marketing-segment opportunities, it has to decide how many
and which ones to target. Marketers are increasingly combining several variables in an effort
to identify smaller, better-defined target groups.
The decisions involved in targeting strategy include:
* Which segments to target?
* How many products to offer
* Which products to offer in which segments
In premium segments like flat screens and FDPs the growth in sales has been many times the
industry growth. More importantly, high end product sales are no longer restricted to metros.
Consumer in tier-2 cities seems to be as evolved in lifestyle needs. The consumer profile, too,
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has changed. Higher disposable incomes, greater aspirations and younger demographic have
increased demands for the technologies. And Videocon is targeting this segment.
POSITIONING:
Positioning has come to mean the process by which marketers try to create an image or
identity in the minds of their target market for its product, brand, or organization. It is the
'relative competitive comparison' their product occupies in a given market as perceived by the
target market.Once the competitive frame of reference for positioning has been fixed by
defining the customer target market and nature of competition, marketers can define the
appropriate points-of-difference and points-of parity associations.
Points of Parity (POPs) are associations that are not necessarily unique to the brand but may
in fact be shared with other brands. They represent necessary-but not necessarily sufficient-
conditions for brand choice.
Videocon's Points-of-Parity are good quality Picture and good sound.
Points-of-Difference (PODs) are attributes or benefits consumers strongly associates with a
brand, positively evaluate, and believe that they could not find to the same extent with a
competitive brand.
Videocon's POD is the quality product with low cost.
With the strong backward integration Videocon can provide the products with low cost.
Thus, Videocon is positioned itself as a reliable and value-for-money
product
DISTRIBUTION CHANNELS IN THE INDUSTRY
The Refrigerator companies in the industry use different distribution channels to reach the
customer. These are as follows:
1. In this type of channel the company uses its sales representatives to deal with the dealers
directly. The dealers place the order through the sales representatives who visit them
periodically, and the products are delivered directly from the company.
Some companies appoint Direct Dealers who act as their Franchisee Outlets or their
Exclusive showroom.
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2. In this channel of distribution the company appoints distributors on the basis of District/
Population /No of Dealers to be handled by one distributor. The area of operation and its
potential is also taken into consideration.
Some of the companies make the distributor totally responsible from appointing the dealers to
providing after sales service.
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3. In this channel of distribution the company appoints Distributors as well as Direct
Dealers. The company appoints distributors to deal with small dealers who order small
quantities. With the dealers who have good potential and sales the company deals directly.
The Korean Multinational follow this channel where they appoint Distributors for upcountry
towns and direct dealers for big cities and major towns eg. Ahmedabad.
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4. In this channel the company appoints a C&F agent who acts on behalf of the company.
The C&F agent is totally responsible for appointment of Distributors and Direct Dealers. He
sells to both the Distributors and the Direct Dealers at the same rates.
PROMOTION STRATEGIES
Product strategy
1. Stop all curved CPT production
2. Shift focus to LCD CTVs; target: by December 2007.
3. Launch Slim21 and focus Slim 29 immediately. Target is to have almost all CRTs
production shifted to Slim by 2007
4. Take full advantage of Digital and HDTV revolution, gain leadership in HDTV Slim
TV segment through OEM and model mix worldwide strategy.
5. Study unique product range / pro large to fill market gaps in markets such as Asia and
Eastern Europe / CIS / South America
6. Focus on reduction of costs through reduction of glass, shift to AK mask and
reduction of process rejection.
Sales Strategy
1. Improve relationship with existing clients ; Use of Thomsons excellent relations as
preferred supplier to maximize sales
2. Improve service and quality without putting pressure on price structure
3. Fetch a better price and avoid crisis of huge stock.
4. Leverage Slim product offering
5. Launch LCD panels assembly to be a major actor of the Flat Panel Displays market
(which is expected to account for 50% of the market by 2012).
6. Benefit from OEM CTV business with the help of Videocons CTV division, invest
for new models, introduction of new technologies.
7. upgrade to LCD's schemes
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y easy EMI.
y Re. 1 offer.
8. Improve after sales service
9. Free service camp on the wheels.
Industrial Strategy
1. Consider improvement in production lines set-up: investments, line speed up /
mergers? Target is to increase output and decrease product costs by increasing
productivity of existing lines
2. This will reduce manpower and overheads per picture tube by 30% that will be
redeployed on new activities in the sites (new technologies)
3. Improve the furnace output in the Poland Glass factory by making some changes into
furnaces including electrical boosting. Consider increasing capacity through one morefurnace.
4. t is envisaged that 100m will be invested in the next 2 years for this purpose
5. Expand into LCD panels back-end assembly (from buying LCD arrays from big
suppliers like LG, SDI, CMO, AUO, Sharp)
Cost Strategy
1. Leverage the strong base of Videocons glass business: Thomson-Videoconpartnership will have a very strong negotiation position and can reduce impact of glass
pricing volatility.
2. Reduce production cost by upgrading and improving the production lines. Thomson-
Videocon partnership will have its own base of additional 4 million units CTV (other
than India)
3. Necessary to rationalize R & D efforts, necessary to make its cost below 1.5% of sales
Product Development
1. i-TV web enabled TV at the price of 13,900 with exchange offer for an older
version.
2. TVs With hard disk to store programs.
3. Wall mounted Flat CTVs at the price of 12,990.
4. Aimed at fulfilling needs of customer who can not buy LCDs but prefer to do away
with CTV models which occupy space in living rooms.
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5. CTVs with inbuilt set top box
6. Tie up with DTH player and provide annual subscription offer.
7. to provide Direct to home services.
8. Bluetooth enabled CTV.
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CHAPTER 4: FINANCIAL ANALYSIS:-
1.Sources of finance.2.Ratio analysis Any 5.3.Net profit/balance sheet (from annual report) Analyses.
Cash Flow of Videocon industries
------------------- in Rs. Cr. -------------------
Sep '05 Sep '06 Sep '07 Sep '08 Sep '09
15 mths 12 mths 12 mths 12 mths 12 mths
Net Profit Before Tax 451.83 913.67 1082.90 1294.78 578.34
Net Cash From Operating
Activities
-
1792.991351.72 1133.68 -1193.44 647.41
Net Cash (used in)/from
Investing Activities
-
4492.92-2843.94 -1268.50 -1909.68 -1018.71
Net Cash (used in)/from Financing
Activities7681.64 1232.47 -112.33 2602.30 481.53
Net (decrease)/increase InCash
and Cash Equivalents1395.73 -259.76 -247.15 -500.82 110.22
Opening Cash & Cash Equivalents 0.28 1396.01 1136.26 889.11 388.28
Closing Cash & Cash Equivalents 1396.01 1136.25 889.11 388.28 498.51
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INCOME STATEMENT
Income Statement
30-Sep-
09(12)
30-Sep-
08(12)
30-Sep-
07(12)
Profit / Loss A/C Rs mn 10% Rs mn 10% Rs mn I0%
Net Sales (10) 91630.41 100.00 97536.54 100.00 82854.24 100.00
Material Cost 56268.43 61.41 52933.45 54.27 49300.08 59.50
Increase Decrease Inventories -124.47 -0.14 -22.98 -0.02 -318.74 -0.38
Personnel Expenses 1264.23 1.38 1158.18 1.19 1161.28 1.40
Manufacturing Expenses 8313.37 9.07 13496.32 13.84 2593.66 3.13
Gross Profit 25908.85 28.28 29971.57 30.73 30117.96 36.35
Administration Selling and
Distribution Expenses8330.43 9.09 6698.91 6.87 12863.34 15.53
EBITDA 17578.42 19.18 23272.66 23.86 17254.62 20.83
Depreciation Depletion and
Amortisation5771.52 6.30 6602.07 6.77 5017.83 6.06
EBIT 11806.90 12.89 16670.59 17.09 12236.79 14.77
Interest Expense 6363.61 6.94 4011.03 4.11 3106.51 3.75
Other Income 340.15 0.37 288.22 0.30 1663.62 2.01
Pretax Income 5783.44 6.31 12947.78 13.27 10793.90 13.03
Provision for Tax 1040.00 1.13 3119.58 3.20 2312.14 2.79
Extra Ordinary and Prior Period
Items Net0.00 0.00 -1278.10 -1.31 0.00 0.00
Net Profit 4743.44 5.18 8550.10 8.77 8481.76 10.24
Adjusted Net Profit 4743.44 5.18 9828.20 10.08 8481.76 10.24
Dividend Preference 36.81 0.04 36.81 0.04 36.81 0.04
Dividend - Equity 0.00 0.00 0.00 0.00 803.02 0.97
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Balance sheet
Balance Sheet of Videocon Industries -------------Rs in crore----------
Sep ' 09 Sep ' 08 Sep ' 07 Sep ' 06 Sep ' 05
Sources of funds
Owner's fund
Equity share capital 229.41 229.30 220.95 220.84 206.53
Share application money 95.00 - - - 65.24
Preference share capital 46.01 46.01 46.01 46.01 -
Reserves & surplus 6,929.63 6,538.49 5,357.91 3,847.63 3,420.56
Loan funds
Secured loans 6,735.04 4,401.25 3,343.50 3,608.39 2,776.10
Unsecured loans 2,349.51 3,604.34 1,916.14 1,352.80 473.47
Total 16,384.59 14,819.39 10,884.50 9,075.67 6,941.90
Uses of funds
Fixed assets
Gross block 9,004.95 8,947.78 8,083.16 7,127.93 5,578.62
Less : revaluation reserve - - 53.52 924.57 951.84
Less : accumulated depreciation 4,298.83 4,310.63 3,376.67 2,847.09 2,286.77
Net block 4,706.12 4,637.15 4,652.98 3,356.27 2,340.00
Capital work-in-progress 1,314.15 1,289.52 612.98 608.28 699.23
Investments 3,064.90 2,695.59 2,092.50 1,781.17 338.79
Net current assets
Current assets, loans & advances 8,820.90 7,641.68 5,142.49 4,425.46 4,449.32
Less : current liabilities & provisions 1,521.48 1,444.55 1,616.44 1,095.51 885.44
Total net current assets 7,299.42 6,197.13 3,526.05 3,329.96 3,563.88
Miscellaneous expenses not written - - - - -
Total 16,384.59 14,819.39 10,884.50 9,075.67 6,941.90
Notes:
Book value of unquoted investments 3,056.96 2,524.79 1,906.24 1,618.68 321.18
Market value of quoted investments 10.83 214.72 230.38 94.13 51.79
Contingent liabilities 122.93 178.17 112.59 81.65 207.72
Number of equity sharesoutstanding 2294.07 2294.51 2210.94 2209.86 2065.26
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Sep ' 09 Sep ' 08 Sep ' 07 Sep ' 06 Sep ' 05
(Lacs)
SOURCES OF FINANCE IN THE COMPANY
Equity share capital, Preference Share Capital and Loan Funds are divided into Two parts :
1. Secured Loans
2. Unsecured Loan
In September 5 Company Equity Share capital is 266 and it continuously increasing in
subsequent date of this month, but company does not increasing Preference Share Capital, it
is constant in subsequent date of this month. Company is also increasing their Secured and
Unsecured Loan. Company taking secured Loan on September 05 was 277.10, but it showed
a large increase in September 09, it increased by 233.79. Secured Loan also increasing in
September 05 to September 08, but in September 09 it is decreased by 1245.83
FINANCIAL RATIOS
Key Financial Ratios ofVideocon Industries
------------------- in Rs. Cr. -------------------
Sep05 Sep'06 Sep '07 Sep '08 Sep '09
Investment Valuation Ratios
Face Value 10.00 10.00 10.00 10.00 10.00
Dividend Per Share 2.50 3.50 3.50 1.00 2.00
Operating Profit Per Share (Rs) 41.44 60.65 75.63 104.26 81.69
Net Operating Profit Per Share (Rs) 264.3 326.66 374.75 425.09 399.42
Free Reserves Per Share (Rs) 151.7 161.05 231.68 274.10 285.35
Bonus in Equity Capital -- -- -- -- --
Profitability Ratios
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Operating Profit Margin (%) 15.67 18.56 20.18 24.52 20.45
Profit Before Interest And Tax Margin
(%)9.74 11.65 15.00 17.62 14.11
Gross Profit Margin (%) 12.25 16.90 17.14 17.75 14.15
Cash Profit Margin (%) 13.60 17.73 15.24 17.50 11.51
Adjusted CashMargin (%) 14.78 15.21 14.10 17.50 11.51
Net ProfitMargin (%) 7.78 11.14 10.23 9.99 4.35
Adjusted Net Profit Margin (%) 8.95 8.62 9.10 9.99 4.35
Return On Capital Employed (%) 8.23 10.83 12.17 12.17 8.08
Return On Net Worth (%) 11.58 19.89 15.20 14.45 5.54
Adjusted Return on Net Worth (%) 13.50 15.48 13.56 15.59 6.66
Return on Assets Excluding
Revaluations4.87 7.38 252.33 294.96 312.07
Return on Assets Including
Revaluations5.46 8.05 254.75 294.96 312.07
Return on Long Term Funds (%) 8.63 11.28 12.94 12.71 8.31
Liquidity And Solvency Ratios
Current Ratio 3.17 2.43 1.76 2.82 3.94
Quick Ratio 4.03 2.81 2.15 4.14 4.62
Debt Equity Ratio 0.90 1.23 0.95 1.19 1.28
Long Term Debt Equity Ratio 0.82 1.14 0.83 1.10 1.23
Debt Coverage Ratios
Interest Cover 2.62 4.35 4.27 4.50 2.08
Total Debt to Owners Fund 0.90 1.23 0.95 1.19 1.28
Financial Charges Coverage Ratio 3.64 5.76 5.17 5.71 2.86
Financial Charges Coverage Ratio Post
Tax4.05 6.11 4.78 4.80 2.47
Management Efficiency Ratios
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Inventory Turnover Ratio 6.30 5.65 6.00 6.44 5.32
Debtors Turnover Ratio 10.94 6.83 6.82 6.73 5.57
Investments Turnover Ratio 6.49 5.83 6.25 6.44 5.32
Fixed Assets Turnover Ratio 3.47 2.07 1.81 1.10 1.02
Total Assets Turnover Ratio 0.79 0.80 0.76 0.66 0.56
Asset Turnover Ratio 0.98 1.02 1.03 1.10 1.02
Average RawMaterial Holding 87.69 76.52 68.44 76.52 83.60
Average Finished Goods Held 18.69 17.48 16.55 15.71 16.13
Number of Days In Working Capital
293.7
1 166.06 153.21 228.73 286.78
WORKING NOTES:
CURRENT RATIO =CURRENT ASSETS / CURRENT LIABILITY
2005 4449.32/885.44= 5.02
2006 4425.46/1095.51= 4.03
2007 5142.49/1616.44=3.18
2008 7641.68/1444.55=5.29
2009 8820.90/1521.48=5.79
LONG TERM DEBT EQUITY RATIO:
LONG TERM DEBT EQUITY RATIO = DEBT / EQUITY
2005 6941.90/206.53= 33.61
2006 9075.67/220.84=41.09
2007 10884.50/220.95=49.26
2008 14819.39/229.30=64.62
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2009 16384.51/229.41=71.42
DEBT EQUITY RATIO = SECURED LOAN + UNSECURED LOAN
2005 2776.10 + 473.47 = 3249.57
2006 3608.39 + 1352.80 = 4961.19
2007 3343.50 + 1916.14 = 5259.64
2008 4401.25 + 3604.34 = 8005.59
2009 6735.04 + 2349.51 = 9084.55
QUICK RATIO:
QUICK ASSETS = QUICK RATIO =
CURRENT ASSSTS STOCK QUICK ASSETS/CURRENT
LIABILITY
2005 4449.32-0= 4449.32 2005 4449.32/885.44=5.02
2006 4425.46-0=4425.46 2006 4425.46/1095.51= 4.03
2007 5142.49-0=5142.49 2007 5142.49/1616.44=3.18
2008 7641.68-0=7641.68 2008 7641.68/1444.55=5.29
2009 8820.90-0=8820.90 2009 8820.90/1521.48=5.79
Proprietary ratio = Shareholder funds/Total assets
2005 206.53/6941.90=0.0297
2006 220.84/9075.67=0.0243
2007 220.95/10884.50=0.0202
2008 229.30/14819.39=0.0154
2009 229.41/16384.59=0.0140
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In 2005 current ratio is 5.02 but it decreased in 2007-2008. It shows that a low ratio
indicates that the enterprise may not be able to meet it current liabilities on time and
inadequate working capital, but it is increasing in September 2008-2009 which shows the
other hand, a high ratio indicates fund are not used efficiently and are lying ideal. It indicates
poor investment policies of the management. The current ratio thus, through a good light on
the short term financial position and policy of a firm.
In 2005 debt equity ratio is 3249.57, but it is increasing in September 2008-2009
which shows this ratio is sufficient to assess the soundness of long term financial position. It
also indicates the extend to which the firm depend upon outsider for its existence. In other
words, it portrays the proportion of total fund acquired by the firm by way of loans.
In 2005 quick ratio is 5.02, but it is decreasing in 2007-2008, it shows that the high
liquidity ratio compared to current ratio may indicate under stocking while a low liquidity
ratio indicates overstocking,but it is increasing September 2008-2009 which shows quickratio
is considered a better measure to judge the short term financial position of the business as
compared to current ratio.
In 2005 proprietary ratio is 0.0297 but it is decreasing in 2007-2008 a high ratio
indicates adequate safety for creditor. But a very high ratio indicates improper mix of
proprietor fund s and loan funds, which results in lower return investment it is so because on
loan fund, interest is deductible as an expense and thus, the enterprise does not pay income
tax thereon. As a result, it yields higher return investment. A low ratio, on the other hand ,
indicate inadequate low safety cover for the creditors.
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CHAPTER 5: KEY LEARNINGS FROM THE COMPANY AND
RECOMMENDATIONS:-
1.Performance Analysis of the Company.2.Market share/growth rate of company.3.
SWOT Analysis of the Company.
Analysis of Net Profit
EARNINGS: Videocon, July- September net profit Rs.1.6 bln, up 7% on year Videocon
Industries Ltd Thursday reported net profit of Rs. 1.6 billion for Jul-Sep, up 7.14% from a
year ago.In a news release, the company said its net sales in the quarter were Rs. 29.85
billion, up 14% from a year ago.Total expenditure for the quarter stood at Rs. 25.95 billion,
up 14.7% from a year ago.Raw material cost expanded 17.6% to Rs. 10 billion and employee
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cost stood at Rs. 499.4 million, up 47.8% from a year ago.Revenue from the consumer
electronics and home appliances segment was at Rs. 27.31 billion, up 18.6% from a year ago
and revenue from crude oil and natural gas segment was down 20.3% at Rs. 2.54 billion.The
company said it has extended its current accounting year by three months and thus the current
year will be of 15 months beginning Oct 1, 2009 and ending Dec 31, 2010.
Profit loss account
Sep ' 09 Sep ' 08 Sep ' 07 Sep ' 06 Sep ' 05
Income
Operating income 9,163.04 9,753.65 8,285.42 7,218.82 5,460.25
Expenses
Material consumed 5,614.40 5,291.05 4,954.79 4,162.74 3,070.27
Manufacturing expenses 773.74 1,285.85 988.23 986.28 916.22Personnel expenses 126.42 115.82 105.35 94.70 49.53
Selling expenses 550.04 505.07 470.62 412.12 360.47
Adminstrative expenses 224.47 163.62 94.21 222.71 207.96
Expenses capitalised - - - - -
Cost of sales 7,289.07 7,361.40 6,613.19 5,878.56 4,604.44
Operating profit 1,873.97 2,392.25 1,672.24 1,340.26 855.81
Other recurring income 27.39 71.92 71.55 127.21 35.66
Adjusted PBDIT 1,901.37 2,464.18 1,743.79 1,467.47 891.47
Financial expenses 665.75 431.86 337.17 254.75 244.96
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Sep ' 09 Sep ' 08 Sep ' 07 Sep ' 06 Sep ' 05
Depreciation 577.15 660.21 418.39 484.00 320.15
Other write offs - - - - -
Adjusted PBT 658.46 1,372.11 988.23 728.72 326.36
Tax charges 177.68 312.67 227.68 95.16 -166.03
Adjusted PAT 480.78 1,059.43 760.55 633.56 492.40
Non recurring items -80.12 -205.14 94.67 -139.82 -152.50
Other non cash adjustments 73.68 0.72 3.54 0.30 2.36
Reported net profit 474.34 855.01 858.76 494.04 342.26
Earnigs before appropriation 2,536.34 2,306.65 1,696.84 932.95 602.36
Equity dividend 46.25 22.95 80.30 77.35 55.19
Preference dividend 3.68 3.68 3.68 3.39 2.50
Dividend tax 8.49 4.53 14.27 11.32 8.09
Retained earnings 2,477.92 2,275.49 1,598.59 840.89 536.58
Profit and Loss account of this firm show that operating income of this firm is
increasing. It was 5460.25 in Sept 2005, but on Sept 2006 it increasing to 7218.82. This
increase shows the growth of this firm. On the other hand, expenses Sept 2005 is 3070.27 Rs.
it was also increasing to 4162.74. But expense of this firm continuously increasing on the
other hand operating income increasing in Sept 2008- 2009 by 590.62.it show that firm
growing rate falling. In short we can say that firm expenditure rate is more than income rate.
it shows that firm is doing strongly in the market.
Throughout the balance sheet
the firm mainly source of firm money is secured loan because it is increasing continuously, it
was 2776.10 on Sept 2005 but in Sept 2006 it was 3608, it means firms large amount of
money arrange from secured loan. Firm is also getting fund from issuing of share capital firm
future power reserve and surplus also increasing it show that increasing rate power. Balance
show the financial position of the firm.
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Market Share and Growth Rate of Videocon
Videocon Industries Ltd
Videocon holds 25% market share in the consumer goods market in India. It is oneof the
largest CPT manufacturers globally, with operations in India, Mexico, and Italy
Videocon, founded in 1985, is today one of the largest corporate groups in India. It is now
venturing into power and telecom. It is one of the largest manufacturers of Colour Picture
Tube (CPT)globally. It has close to 25% market share in home appliances segment in India
and aims to double this business in next five years. Apart from its core businesses, the
company isaiming to grow its power and telecom (handset and services) businesses
aggressively through large scale investments.
Market Share (%) for FY09
Videocon Industries is primarily engaged in two core businesses
y Manufacturing, assembly, marketing and distribution of consumer electronic
products & home appliances
y Consumer Electronics, Home Appliances & Compressor manufacturing: Products
include home entertainment systems,microwave ovens, Colour Picture Tube
(CPT) & liquid crystal display (LCD) televisions, refrigerators, washing machines,
airconditioners, small appliances, glass shells, compressors / motors and other
components
The Company has Research & Development centres located in China, India and Japan
y Display industry and its components: Manufactures colour picture tubes at its
facilities in Italy, Poland and China
y Colour Picture Tube (CPT) Glass: Operates manufacturing facilities in India and
Poland
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The Company, through its wholly owned subsidiaries and JVs, is engaged in exploration
activities in oil & gas fieldsinBrazil,Mozambique, East Timor, Oman and Australia
y Entry into the Telecom business: In March 2010, Videocon Telecommunications Ltd,
a unit of Videocon Industries Ltd, launchedmobile services based on the global system
mobile (GSM) platform
y Power business: Pipavav Energy, the Companys subsidiary, is implementing a
thermal power project in Gujarat with a capacityof 1,200 MW; Videocon is also
considering power projects in the other parts of India and evaluating alternate
technologies forthe same.
y Plans to set up three more thermal power generating units with a combined capacity of
4,800MW in Maharashtra,Chhattisgarh and Asansol, with a total investment of
USD6.5bn
y The equity shares of the Company are listed on the Bombay Stock Exchange and
National Stock Exchange of India; the Global DepositoryReceipts (GDR) and
Foreign Currency Convertible Bonds (FCCB) issued by the Company are listed onthe
Luxembourg Stock Exchange and Singapore Exchange Trading Securities
respectively
Company
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SWOT ANALYSIS
The SWOT is a strategic planning tool to evaluate Strength(S) Weakness(W)
Opportunities(O) & Threats(T) involved in a project, in a business venture or in any other
situation requiring a decision. The SWOT analysis is to explained with help of following
diagram
SWOT Analysis
Strengths:
y Technologic
al skills
y Leading
Brands
y Distribution
Channels
y Customer
Loyalty/ Relationships
y Production
Qualtiy
y Scale
y Managemen
t
Weaknesses:
y Absence of
important skills
y Weak
brands
y Poor access
to distribution
y Low
customer retention
y Unreliable
product/ service
y Sub-scale
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y Managemen
t
Opportunities:
y Changing
customer tastes
y Technologic
al Advances
y Change in
government politics
y Low
personal taxes
y
Change inpopulation age
y New
distribution channel
Threats:
y Changing
customer base
y Closing of
geographic markets
y Technologic
al advances
y Changes in
government politics
y Tax
increases
y Change in
population age
y New
distribution channels
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CHAPTER 6: Findings
FINDINGS
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With strategically located manufacturing bases and an enviable distribution network of
around 90 branch offices, 10,000 distributors & 400 after-sales service centers across India,
VIL enjoys a unique 80% plus penetration in the market place.
A high degree of backward integration ensures that VIL has most of the vital components
under its control and bestows upon it unique benefits over competition uninterrupted
supply, shorter turnaround time, cost advantage and quick adaptation to changing customer
needs.
VIL is looking to strengthen its presence through a host of big ticket acquisitions/asset
buyouts Daewoo Electronics (South Korea), Chunghwa Picture Tubes (Taiwan), Pioneer
(Japan) and other brown-field expansions will help VIL expand its horizons.
VILs glass division, VNG, is the largest single location glass shell plant, enjoying economies
of scale and a leading position in the global glass shell industry. Additionally, integration of
its acquired Thomson Colour Picture Tube (CPT) plants with its Indian business would not
only reduce the cost of production, but also give its glass shell units a ready market.
The Thomson acquisition includes R&D centres and access to over 2,000 patents, which
would enable VIL to launch new products as well as counter the threat posed by the
conventional TV market being rapidly overtaken by hi-tech products in overseas markets.
Increasing demand & high prices in the oil & gas industry will not only lead to improved
realizations, but along with low operating costs that the Ravva oil & gas field enjoys, it can
translate into a bonanza for VIL.
VIL has earmarked USD 13 MM (FY07) & USD 24 MM (FY08) as capex for its oil & gas
business, in order to increase the extraction from the field. It has also embarked upon Infill
Well Drilling and exploration & production of three new blocks; LM-403, Back Fault Block
& LO-110, all in the Ravva field. The probable reserves in the Ravva Oil field are estimated
to be as high as 400 MM barrels, of which only about 160 MM barrels have been produced.
Thus, a huge upside potential exists for the company.
VIL is exhibiting substantial panache by fruitfully working towards bidding for and more
often than not, attaining exploration and production rights in many countries around the
world. It is well on its way to earning remarkable profits & achieving a prominent global
standing.
CHAPTER 7: Conclusions and Suggestions
CONCLUSIONS AND SUGGESTIONS
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Turbulent is the word that aptly describe the scenario in CTV industry last financial year.
Marketers by frequent price cuts and larger than live Marketing game plans, competition
reached its new highs and lows. It is no longer sufficient to just be competitive, a company
which has to survive has got to have competitive advantage. One needs to take strategic
initiative in the short run to achieve the desired positioning in future. One has to foresee
tomorrow.
Understanding competition today involves three levels:
Competition for intellectual leadership for new ideas that create new advantages.
Competition for translating these ideas into product/service faster than others.
Competition for market share.
Do not nature any PARADIGMS because today anything is possible
Search for newer markets than expanding your customer base.
Come out with state of the art, feature packed affordable and competitive advantageous
products.
Set Benchmarks for growth.
Improve up on distribution channels for viable coverage of the market.
Wear out competition through trend setting, inimitable tactical moves based on our
infrastructure strengths.
The strategic intent should be clear down the management.
Work on your strengths i.e. Infrastructure, financial base, backward integration.
POP andMERCHANDISING material should be mad as per international market.
CORPORATE TRAINING PROGRAMME for Development of manpower from external
faculty.
We have so far identified the various areas on which Videocon and other major Indian
companies need to improve upon to achieve the desired level of competitiveness. Only these
improvements would give Videocon and the other Indian companies base to compete with the
MNCs and help the Indian companies to reduce the impact ofMNCs on the Indian Market in
the future. Indian manufacturers will have to react quickly because any delay in reacting to
the threat posed by the MNCs would only give the MNCs time to establish themselves in the
market. With their expertise and financial capacity they would be nearly impossible to
compete with once they get a firm foot hold in the market. The future
But the battle has only started, and the foreign companies are here for the long term. They can
sustain losses for years to come in order to gain market share. What they are doing at present,
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is building up distribution networks to cover every nook and corner of the country and,
setting up manufacturing facilities.
Only those Indian manufactures which have a strong focus on manufacturing and
technological up gradation will survive in the long run, although with a much smaller market
share than they have at present. Small companies will be sidelined totally and will exit from
the CTV market altogether.
Videocon has always been driven by its Value -for-money strategy. The company needs to
identify critical success factor and work assiduously towards achieving it.
SUGGESTIONS
To strengthen and maintain & its leadership status, the Videocon group has clearly charted
out its course for the future. Aggressive development is in full swing at the R & D Centres to
bring out state-of-the-art technologies including True Flat, Slim, Extra Slim, Plasma & LCDs,at the earliest. Cost rationalization processes - are in various stages - including rationalizing
factories in Europe, increasing automation and improvement of efficiency in China, accessing
flass shells from India for international CPT facilities and a lot more - are in various stages of
implementation Internationally all existing client relationships are being strengthened. The
cost competitiveness and increase in capacity in Polland has opened up big opportunities in
the OEM business. Last but not the least, in the domestic market consolidation with multiple
brands paves the way for an unassailable lead in the market.
In the Oil & Gas business, having all the basic operator capabilities of a prospecting entity,
the group is looking to add more explorations and production depth as also oil bearing assets.
The group will also get into gas distribution in India significantly.
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y BIBLOGRAPHY
y http://en.wikipedia.org/wiki/Videocon
y http://www.videoconworld.com/
y http://www.google.co.in/
y www.branders.com
y www.viewcentral.com
y www.eventmarketer.com
y www.mobilemarketingjoblist.com