1. Mahindra & Mahindra is a leading Indian automotive company with a presence across various industries such as automobiles, tractors, IT and infrastructure through both organic growth and acquisitions.
2. The company has successfully diversified over the years through both related diversification into areas like automotive components and unrelated diversification into sectors like IT, infrastructure, hospitality and finance.
3. Mahindra has pursued an aggressive acquisition strategy, acquiring companies in its core automotive segment as well as unrelated sectors to drive growth and synergies across business units.
1. Mahindra & Mahindra is a leading Indian automotive company with a presence across various industries such as automobiles, tractors, IT and infrastructure through both organic growth and acquisitions.
2. The company has successfully diversified over the years through both related diversification into areas like automotive components and unrelated diversification into sectors like IT, infrastructure, hospitality and finance.
3. Mahindra has pursued an aggressive acquisition strategy, acquiring companies in its core automotive segment as well as unrelated sectors to drive growth and synergies across business units.
1. Mahindra & Mahindra is a leading Indian automotive company with a presence across various industries such as automobiles, tractors, IT and infrastructure through both organic growth and acquisitions.
2. The company has successfully diversified over the years through both related diversification into areas like automotive components and unrelated diversification into sectors like IT, infrastructure, hospitality and finance.
3. Mahindra has pursued an aggressive acquisition strategy, acquiring companies in its core automotive segment as well as unrelated sectors to drive growth and synergies across business units.
1. Mahindra & Mahindra is a leading Indian automotive company with a presence across various industries such as automobiles, tractors, IT and infrastructure through both organic growth and acquisitions.
2. The company has successfully diversified over the years through both related diversification into areas like automotive components and unrelated diversification into sectors like IT, infrastructure, hospitality and finance.
3. Mahindra has pursued an aggressive acquisition strategy, acquiring companies in its core automotive segment as well as unrelated sectors to drive growth and synergies across business units.
Threat of new entrants: - More time and high cost of entry Low -Knowledge and technology -Government policy -Access to distribution channels Moderate Moderate High Intensity of Rivalry : High Bargaining Power of Bargaining Power of Buyers : -Number and diversity of - More options Suppliers : competitor - Buyers are large in number - Switching cost is high - High price competition - Price sensitive - Unique products - High exit barriers - Brand loyalty - Few suppliers - Product quality and - Quality of goods is critical features
Moderate Threats of Substitute: - Use of Public transport - Differentiated industry Products RESOURCES Tangible Intangible Human • Financials • Technology • Human – Total assets Rs 35,675 – C2 CRDe engine – Top Management Cr – In-house gasoline – Centre for Creative – Cash Rs 2633 Cr engine Leadership, USA – Investments Rs 4825 Cr – Applied for 24 patents – Low debt/equity ratio & 8 Design registrations • Physical – Micro hybrid – Mahindra research & technology (Pick-ups) valley, Chennai (Pro dev, testing, validation) • Brand & Reputation – Plants at Nasik, Chakan, – Swaraj, Arjun tractors at 8 different locations – Worlds no.1 tractor – Mahindra ‘Samriddhi’ manufacturer (soil & water testing – ‘Mahindra Tractors’ labs) iconic brand, enjoys strong following CAPABILITIES(FUNCTIONAL)
Distribution • Effective rural dealership channels
• Creating synergy between Tech Mahindra
HR and Satyam employees
• Yuvraj-215 Tractor received ‘Golden
Peacock Award,2010’ for innovative R&D product and Scorpio won Autobid technology award for its Micro Hybrid technology
• Successfully diversifying into IT,
Management Hospitality, Financial services sectors VIRU ANALYSIS Capability Valuable Costly to Rare Unmatchable Competitive Performance imitate Consequences Implication
Largest Producer Yes Yes Yes No Sustainable Above Avg.
of Tractors in Competitive Return world SUVs: Bolero Yes No No Yes Competitive Average to above Sales Parity avg. Return Scorpio: Own R Yes Yes No No Competitive Average to above & D; Parity avg. Return
Mahindra No No No No Below Average
Satyam Return Mahindra Yes No Yes No Avg. Return Finance
Brand Value Yes No No No Competitive Average Return
Parity INTEGRATION 2002: SUV 2010: SUV(SsangYong Motor Company) 1999:Launch of Bijlee, a battery-operated, environmental-friendly 3-wheeler 2007:Mahindra Navistar Automotives Ltd. 1965: LCV
1963: Tractors 2009: Electric car 1949 :Assembly of Willys Jeep segment(REVA)
Backward Intgr Horizontal Intgr Diversification 2005:Manufacture of gears and transmission shafts VALUE CHAIN ANALYSIS(Xylo) Simplified Planning Practices to Reduce Planning Costs Activities Support
Effective Training Programs
to Improve Worker Efficiency and Effectiveness
Easy-to-Use Manufacturing Investments in Technology in order
Technologies to Reduce Costs Associated with Manufacturing Processes Systems and Procedures to find the Frequent Evaluation Processes to Lowest Cost Products to Purchase Monitor Suppliers’ Performances Raw Materials Highly Efficient Efficient Plant Delivery Schedule Small, Highly Effective Product Systems to Link Scale to Minimize that Reduces Trained Sales Installations to Suppliers’ Manufacturing Costs Force Reduce Frequency Products with the Costs and Severity Firm’s Production Products Priced to of Recalls Processes Generate Sales Selection of Low Volume Organizational Located in Close Cost Transport Learning National Scale Proximity with Carriers Suppliers Advertising
10% 5% 5% 0% Cost Reduction Of
21% Primary Activities VALUE CHAIN ANALYSIS MERGER & ACQUISITION c • In Dec1999 Mahindra-Gujraat Tractor(60%) • In Jan 2007 Mahindra- Schoneweiss, Germany(90%) • In March 2008 Mahindra- G.R.Grafica Ricerca Design (GRD) • In July 2008 Mahindra-Punjab tractor • In July 2008 Mahindra-Kinetic (80%) • In April 2009 Tech Mahindra – Satyam • In Apr 2010 Mahindra-Logan • In May 2010 c • In May 2010 Mahindra- GippsAero,Australia • In Aug 2010 Mahindra- Ssangyong Motor Company Joint Venture: • In Nov 2005 Mahindra-Navistar Truck, USA (51:49) • In March 2010 Mahindra + Yueda Group = MYYTCL ACQUISITION ` Year Acquisition Stake %
Dec1999 Mahindra-Gujraat Tractor 60
Jan 2007 Mahindra- Schoneweiss, Germany 90 March 2008 Mahindra- G.R.Grafica Ricerca Design (GRD) -
July 2008 Mahindra-Punjab tractor 63
July 2008 Mahindra-Kinetic cc 80 April 2009 Tech Mahindra – Satyam 100 Apr 2010 Mahindra-Logan - May 2010 Mahindra- Reva 55 May 2010 Mahindra- GippsAero,Australia - Aug 2010 Mahindra- Ssangyong Motor Company Proposed
Joint Venture: Nov 2005 Mahindra-Navistar Truck, USA 51:49 March 2010 Mahindra + Yueda Group 51:49 DIVERSIFICATION
ENGINEERING AUTOMOBILES
AGRI
IT
INFRASTRUCTURE HOSPITALITY RETAIL FINANCE RELATED & UNRELATED DIVERSIFICATION
TRADING INFRASTRUCTURE AUTOMOTIVE
LOGISTIC FORAY (3%) (60%)
Retail Lifespace Two Wheeler ENGINEERING
Odyssea Electric Car World City Aircraft Trucks
Powerol Farm Equipments
Defense Finance IT (24%) Vehicles (12%) BCG DATA
Current Competitor Industry Product Market Key Competitor s' Market X Growth(%) Share(%) Share(%)
Internationalization: It is a process of increasing
involvement of an enterprise in international markets.
Strategies : Exporting Licensing Franchising Joint Ventures Acquisitions Green-Field Development Production Sharing Turnkey Operations BOT Concept Management Contracts INTERNATIONAL STRATEGIES
Exporting :
• The company exports its products to several regions
including Europe, Africa, South America, South Asia and the Middle East. • Exports tractors to Turkey • Scorpio, as Mahindra Goa in Italy • Mahindra Pik Up & Bolero Pik Up (Cimarron) in Africa • Xylo Cargo Van in S. Africa • Mahindra Agribusiness (MSSL) exports grapes, pomegranates and apples to Europe & UK INTERNATIONAL STRATEGIES
Joint Ventures :
• In Nov 2005, Mahindra signed a JV with Navistar
International Corporation known as Mahindra International Engines Ltd. (51:49). • Mahindra Yeuda Tractors Co. (80:20) has setup R&D and Engine facility in China in Mar 2010. • Mahindra is now in talks with Proton, an auto giant from Malaysia for a joint venture. INTERNATIONAL STRATEGIES
Acquisitions :
• In Jan 2007, Mahindra acquired Schoneweiss & Co.,
Germany through its subsidiary Mahindra Forgings. • In May 2010, Mahindra acquired Gippsland Aeronautics one of the Australia’s most reputed aircraft producer and Aerostaff Australia, a aircraft component maker. • In Aug 2010, it is planning to acquire Ssangyong Motor Company of South Korea. INTERNATIONAL STRATEGIES
Franchising :
• Mahindra Ocean Blue Marine Pvt. Ltd. which
manufactures powerboats for Indian marine and defence sector is finding international franchisees for enthusiastic customers of recreational boating. MAHINDRA GROUP
