SENSITIVITY ANALYSIS

(what if) in change in key assumptions - What if there is delay or drop in project;
what if raw material price increases etc.
Predicting and managing the critical path is a very important aspect of managing
the project's schedule, if only because it predicts the project completion date. However, the
delay in non-critical path activities has the potential to extend it beyond the current critical
path, such that there is the new critical path, and consequently a revised project completion
date. In order to manage a project, the project manager and the project team must have a solid
understanding of not only the current critical path but also all the possible paths which are
likely to become a critical path. In many projects, there are many activity sequences and
subsequently many paths leading to the end of the project. Therefore, the more paths a project
has, the higher the risk of the critical path changing. project managers have to predict the next
critical path(s) and take extra care when planning and executing those activities that have the
potential to cause changes in a project's critical path(s). The framework can be used as an
early warning system that identifies which path is likely to become the critical path, and also
identifies which activity in particular in the new predicted critical path contributes the most to
that prediction.
MARKETING FEASIBILITY

COMPETITION SCENARIO

The main competitor of ABC MOTORS is XYZ MOTORS Ltd., which is a 20

years old well-known motorcycle company across India. The production capacity of XYZ
MOTORS is 2,90,000 units per year with investment of 750 crores and the plant area is
around 600 acres. The main difference between these two companies is differentiation in
price, positioning strategy and innovation. ABC MOTORS offers economy two-wheelers
which are also high on performance and fuel efficiency when compared to XYZ MOTORS.
ABC Motors has always positioned their vehicles as reliable and easy to use vehicles. ABC
Motors has been high on innovation and has a lot of firsts to its credit. The company has
always tried to stay in tune with the latest trends in styling, performance and fuel efficiency,
while also being conscious about developing environmentally friendly vehicles that strictly
adhere to compliance norms.

DISTRIBUTION CHANNELS

ABC Motors is having around 600 dealerships across India. Recently, ABC
Motors is planning to expand 150 new dealers in small towns. The proposed dealership towns
are in Delhi, Mumbai and Tamil Nadu. These new distribution channels will help the
company to increase the shares in smaller towns and rural areas. And also it will be a huge
potential in small towns. ABC Motors also working with a reputed international retail design
agency to enhance the experience at dealership. Service centers are also being upgraded at an
investment of Rs 15 crores to enhance the service standards in these markets as well.

NATURE OF PRODUCT

Nature of the product is consumer oriented. The main products are motorcycles and
scooters. Motorcycles varieties are Apache series, Radeon, Victor, Star city++, sport and the
varieties of scooters are Jupiter, Ntorq, Wego, Scooty pep 1+ and scooty Zest. ABC Motors
strength lies in design and development of new products varieties and also deliver total
customer satisfaction by anticipating customer need and presenting quality vehicles at the
right time and at the right place.
DEMAND SUPPLY GAP
A demand supply gap in the market is an opportunity to make and sell something
that is not available yet. However, consumers would like to have it. The ‘gap’ means
difference between the supply and demand for that product. In other words, it means a
consumer-need that supply has not yet met.
Worldwide demand for motorcycles remains strong despite China's transition toward
cars for its transportation needs, according to a report by the Cleveland-based Freedonia
Group Inc. Global motorcycle demand is forecast to advance 4.9% annually through 2009,
down from a 6.8% annual increase from 1999 through 2004. In its World Motorcycles' study,
the Freedonia Group cites fuel efficiency and continued restrictions on motorcycle and scooty
use in developed markets as reasons for the continued growth.

ABC motors introduced new motor cycle models like CB Shine, CB unicorn which
has been driving growth during current fiscal aided by enhanced production capacity, making
it possible to cater to the rising demand. The company’s total production capacity is slated to
go up by 1 million units over 6 million units this fiscal year as compared to 5 million units in
2018-2019.

IS IT IMPORT SUBSTITUTION
PQR Automotive Pvt Ltd., electric mobility solutions firm received an additional
investment of Rs 30 million from ABC motors. This investment is part of the Series A
funding from ABC motors. In 2017, ABC acquired a 15.5% stake for around Rs 30 million in
the firm which develops electric mobility solutions. PQR Automotive is currently building an
electric motorcycle that is driven by progressive design and energy efficient technology,
which will allow it to outperform traditional motorcycle segments. PQR Automotive is
building a high- performance electric motorcycle that brings together the best of technology
and design to deliver an unmatched user experience.
SENSITIVITY ANALYSIS ON SALES PROJECTION
A sensitivity analysis determines how different values of an independent variable
affect a particular dependent variable under a given set of assumptions. In other words,
sensitivity analyses study how various sources of uncertainty in a mathematical model
contribute to the model's overall uncertainty. This technique is used within specific
boundaries that depend on one or more input variables. Sensitivity analysis is used in the
business world and in the field of economics. It is commonly used by financial analysts and
economists, and is also known as a what-if analysis. Independent variable is considered as
Sales of the company and dependent variable is Net income. Sensitivity analysis determines
how sales of the two wheelers and scooter affect the net income of the company.

CREDIT APPRAISAL
CIBIL score
A credit score is a statistical number that evaluates a consumer's creditworthiness
and is based on credit history. Lenders use credit scores to evaluate the probability that an
individual will repay his or her debts. A person's credit score ranges from 300 to 850, and the
higher the score, the more financially trustworthy a person is considered to be.
While every creditor defines its own ranges for credit scores (for instance, many lenders think
anything over 800 is excellent), here is the average FICO score range:

 Excellent: 800 to 850

 Very Good: 740 to 799
 Good: 670 to 739
 Fair: 580 to 669
 Poor: 300 to 579

ABC motors having credit score of 805 which denotes that company can able to
repay the loan in the proper way within credit period.