Case Study On Mahindra
Case Study On Mahindra
Case Study On Mahindra
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Case study on Mahindra and Mahindra.
Introduction.
Income level: As income level of the population increases more and more
people will be able to afford cars. As income increases luxury becomes
necessity. Also maintenance and repairs also become affordable to people.
Cost of raw material: Raw materials for the automobile industry include
steel, iron, rubber etc. When it’s cost increases, the cost of manufacturing a
car also increases. Therefore the companies have to increase the market
price too. This may lead to poor sales. On the other hand if there’s a
reduction in prices then the market price may reduce.
Industry profile
Automobile industry is one of the key industries in India and also one of the
largest. It has grown and advanced much after the economy was opened up.
When Indian automobile industry was in its infancy, it depended very much on
foreign technology. However, with time, manufacturers have started using
indigenous technology. The automobile industry in India is the 4th largest in
the world. India produced around 5.2 million units in 2018.
Company profile
Mahindra & Mahindra was setup as a steel trading company in 1945 by the
name of Mohammed and Mahindra. It was later renamed to Mahindra and
Mahindra. It saw the opportunity to manufacture SUVs, heavyweight and
lightweight commercial vehicles, tractors, 2 wheelers, pickups and saloon
cars and then forayed into the automobile industry. It’s the largest tractor
manufacturers in the world and one of the largest automobile manufacturers
in India. Two of its largest competitors are Tata and Maruti Suzuki. Mahindra
and Mahindra is part of the larger Mahindra Group, a conglomerate in India.
Financial Performance.
From the balance sheet we can see that the net worth of the company is
rising over the years. This is a good trend.
Also if we look at the P&L a/c we can see that the sales is increasing year by
year. The Profit after tax also keeps increasing. The company is performing
really good. Although the Earnings per share has reduced in the previous
year, the current year sees a rise again.
SWOT Analysis.
Strength Weakness
*Market leader in multiple automotive *Geographic dependence.
segments. *Product recalls.
*Strong R&D wing. *2 wheeler segment not doing well.
*Perfectly suited for Indian market.
*Low after sale cost.
Opportunity Threats
*Growth in the industry. *Competition from Tata, Ford etc.
*Increasing demand for electric *Strict regulations.
vehicles. *Rising fuel prices.
*Emerging nations.
Strengths.
Market leader in multiple automotive segments: The company is
the market leader in producing tractors and utility vehicles. It also has
strong market share in commercial and passenger vehicles segment.
Perfectly suited for the Indian market: M&M vehicles are perfectly
suited for the Indian road conditions.
Low after sale cost: The after sale cost is lower than the indusrty
average and spare parts have wide availability.
Weakness.
Geographic dependence: M&M is highly dependent on the Indian
market. If there’s an economic slowdown or inflation then the
company will suffer.
Opportunity
Growth in the industry: The automobile industry is growing year in
year and in the last 3 years there was a growth of 12%.
Emerging nations: M&M can try to tap into the emerging nations
which has great potential.
Threats.
Competition from Tata, Ford etc: This puts intense pressure on the
company and has to innovate regularly.