Presents

SUSHODH: Case Study competition

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Round 2 – PPT submission

Prepare a detailed PPT to present your ideas
Submit the file in PDF format
Supporting excel file for financials may be submitted if needed
File name should be: SUSHODH <Team leader’s registered name>
Upload on Dare2Compete
Deadline for submission: 11:59 pm on August 6, 2019
 Case Study

Established in the year 1969, XYZ Company is 50 year young company, the pioneer in
manufacturing of the modern water saving irrigation system in India. The company is
providing the irrigation solutions to the farmer of the country and across the world. Company
has an established brand image of delivering products which of high quality giving a unique
position for the company through its brand value among the farmers.

Green revolution built on better planting material also required water management
for the plant, this was delivered through the cutting edge sprinkler systems introduced by the
company. Also the company was first to introduce the concept of drip irrigation to India and
had the distinction to manufacture both cylindrical and flat emitter inline product at that
time.

Few years down the line while the importance of micro irrigation and its impact to
Indian farmers was well introduced the company played a pivotal role in designing PMKSY
guideline which drives micro irrigation as of date.

Company played a major role in improving coverage under micro irrigation, a step
towards 69 million ha of potential within the 160 million ha of arable land. At present,
company has presence in almost all states. Major markets are Andhra Pradesh, Telangana,
Karnataka, and Tamil Nadu, which contributes almost 70% of company's revenue. 95% of
company revenue comes from subsidy business under PMKSY.

The MI market in India over a period of time is evolving with various challenges faced
in the subsidy segment where both the central government role & the state government role
is very critical. Along with this brings the complex management of various social & political
position which sometimes drives the MI implementation in the respective state but in many
time it acts as a deterrent to coverage of MI. Case in point is of Karnataka market in FY 19
which was largely impacted because of the change in government at the state level resulting
almost 6 months of the MI subsidises being non-operational which not only impacted the
various companies financial but also created a lot of duress for the Karnataka farmers.

The company has put together a strategy in place to de-risk operating only in the
subsidy business segment by wanting to operate in various segments within the MI industry.
The segments in MI business are:

 In the first phase the company over the last two years has started operating in the
projects business and making good progress through deliveries of revenue & bottom
line.
 In FY 20 the company wants to enter the non-subsidy business segment. Market
research for understanding the market size/dynamics of the market/requirement of
the customer etc. was done in the FY 19.

Key highlight of Non Subsidy business segment understood:

 Price is a major strategic tool used by all players operating in this segment
 As a result of which, major players operating are small players (1 to 4 crore turnover)
 Business ethic followed by the small players is very low to ensure that their costs are
at the lowest
 In the process they use all junk material (scrap/mixing with low grade etc.) to ensure
that they have the lowest cost position
 Last year subsidy market saw a growth of 8-9% where as non-subsidy market growth
was 15 - 18%
Table below conveys a broader picture of non-subsidy businesses in Maharashtra, M.P and
Karnataka

STATE MARKET SIZE (in lakh)

MAHARASHTRA 12000
MADHYA PRADESH 1500
KARNATAKA 1000
TOTAL 14500

Given this back ground, the challenge in front of the company which defines the
problem statement:

 Primary product of the Company (Class 2 product) is of high quality, ISI marked
product as it is manufactured using virgin material.
 This product is sold in subsidised segment with an established brand image that
delivers the key image of high quality because of the existence of the brand for 50
years backed by the quality principles that the company has followed.
 The product which are being sold in non-subsidised segment by local players are of
low quality and of lower price segment.
 To protect the primary brand having core values of “quality” & “good price” the
company in the process of implementing the entry into the non-subsidy business
segment want to create a separate brand for this business ensuring that it does not
harm the primary brand and is able to deliver core values for the secondary brand.

Mission:
Your mission if you choose to accept is to create the new brand from the scratch and should
include the following:

 Brand creation and values

 Strategy for the new brand
 Collates for the new brand
 Evolvement of the new brand (1 to 5 years)
 Financials for starting the journey of the new brand + 5 years.
 Annexure I

Non-subsidy product in the market are of the 300 meter coil/bundle (as mentioned on
coil/bundle packing) but the actual length is only 270 meter. To measure the length & quality of
product, the farmer has different parameters. They measure the length by weight of coil/bundle by
weighing & quality by thickness.

Annexure II

Quality of XYZ company- class 1 product

 Smooth inner surface

 Matt Finish
 Pure Virgin material used
 Life cycle 2.5 to 3 years

Quality of the locally available product

 Rough inner surface

 Inner bubble formation on surface ( RP
mix)
 Stiffer material – usage of higher
percentage of RP material
 Glossy surface finish – Outside