STRATEGIC

MANAGEMENT
ANALYSIS OF
“MEGHNA GROUP OF
INDUSTRIES”

Tuhinul Hasan Limon

Parvez Hasan
Nishat Sanjida
Nobin Shakil
 Background of the Company
Meghna Group of Industries (MGI) represents a global enterprise and brand that houses more than
35,000 employees, 6,000 distributors and 15,000 suppliers under its umbrella and has an annual
turnover of approximately $2.5 billion.

The history of one of Bangladesh’s largest leading conglomerates, Meghna Group of Industries
(MGI) can be traced all the way back to 1976 when its predecessor operated under the name of
Kamal Trading Company. The conglomerate itself has humble origins and began its life as Meghna
Vegetable Oil Industries Ltd. in 1989 on a small patch of land in Meghnaghat, Narayanganj.

The secret to the success and vast expansion of MGI has been diversification and the group has
entered a broad array of different markets and industries including Fast Moving Consumer Goods
(FMCG), building materials, pulp and paper, LPG, feeds, fiber, power plants, shipping,
seeds crushing, chemicals, ship building, dockyard, securities, insurance, media and aviation.
The product range of MGI today is truly impressive and the conglomerate markets most of its
products under the recognizable brand names of "Fresh", "No.1", "Actifit", "Pure" and
"Meghnacem Deluxe". The result of this level of reach and diversification has been that within
Bangladesh one in every two households uses MGI products and internationally MGI has a
substantial presence in the Middle East, Southeast Asia, Europe, South Africa, North and South
America.

As a result of this relentless process of expansion MGI has become a powerful player within
Bangladesh and has become the largest investor in relation to industrial development in
Bangladesh over the last few years. MGI became the first company in Bangladesh to establish a
private economic zone known as the "Meghna Economic Zone", which has since been followed
by the creation of two further economic zones, which are named “Meghna Industrial Economic
Zone” and “Cumilla Economic Zone” respectively. The conglomerate has expanded even further
since this point, with an unprecedented investment of $451 million in 2020 that has erected nine
new industrial units within its multiple economic zones.

Throughout this process, and the history of the conglomerate, in general, the unwavering
commitment of its visionary leader, Mostafa Kamal, Chairman and Managing Director of MGI,
has been pivotal. Renowned for his entrepreneurial expertise and patriotism, Mostafa Kamal has
played a key role in the development of industry, healthcare, education, sports and social welfare
in Bangladesh. The integrity and dedication towards the group that he has displayed during his
tenure, in addition to his philanthropic work, have played a vital part in the overall success of MGI.

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 Vision Statement
We are passionately creating sustainable economic value for our country and stakeholders by
contributing to the industrial development of the nation and fundamental requirements of our
consumers.

Mission Statement
Delighting our customers and maximizing value through innovative solutions, inspired employees,
adaptation of technological advancements and living in harmony with environment.

Mission Components Meghna Group of Industries

1. Customers Delighting our Customers
2. Products or maximizing value through innovative solutions
Services
3. Markets X
4. Technology adaptation of technological advancements
5. Concern for maximizing value through innovative solutions, living in harmony
survival, growth, and with environment.
profitability

6. Philosophy X
7. Self-concept adaptation of technological advancements and living in harmony with
environment.

8. Concern for public Delighting our customers and maximizing value through innovative
image solutions,

9. Concern for inspired employees

employees

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 Financial & Non-Financial Objectives of the Company
Financial objectives

A financial objective is a specific goal or target of relating to the financial performance, resources
and structure of a company. Some financial objectives of Meghna group are summarized as
following:

Revenue objectives:

The Company sets revenue objectives. The company wants to increase revenue per year 10%, the
company want at least exceed industry rate. Sales maximization the company seek to increase their
market share even if they have less profit.

Cost objectives:

Cost minimization is a common cost objective - particularly in relation to controlling the fixed
costs of the company and, therefore, the break-even output. The company sets objectives relating
to unit costs and link these to targeted efficiency measures such as labor productivity and/or
capacity utilization.

Cash flow objectives:

The company knows that revenue is vanity, profit is sanity, but cash is king. The company always
tries to keep adequate cash because it is more likely to able achieve other financial objectives by
providing extra financial resources. The company always gives more priority to collect accounts
receivables as early as they can.

Capital structure objectives:

The capital structure of a business refers to the balance of its finance in terms of much is equity
and how much is the form of debt. The company tries to keep its capital structure in balance like
80%/20% (equity to debt). They have a target to become debt free investment if they can.

Return on investment objectives:

Return on investment is measured the gain from an investment relative to the amount invested by
the company. The company sets a target 10-15% return on its investment amount.

Wealth maximization:

Wealth maximization is the concept of increasing the value of a business in order to increase the
value of the shares held by stockholders. They try to increase the market value of shares of their
company.

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 Non-Financial objectives
Corporate social responsibilities (CSR)

Meghna Group of Industries (MGI) started its journey with a quest for doing something for the
people and the country. Therefore, MGI cares for and contributes to its surroundings through
Corporate Social Responsibility.

Many hospitals including Central Hospital Limited, The Barakah General Hospital are sponsored
by the Chairman and Managing director of MGI, Mr. Mostafa Kamal. He also patrons many
schools, colleges, and madrasahs including Al-Haj Noor Miah Degree College, Mostafa Kamal
High School, Al-Haj Ayesha Noor Welfare Foundation, Kankapaith Madrasah and Al-Haj Ayesha
Noor Mohila Dakhil Madrasah. He is also the founder and member of the Board of Governors,
The People's University of Bangladesh and Foundation for People's Education.

MGI assisted 5 flood-affected districts in 2007 and also donated to the Honorable Chief Adviser's
Relief Fund for Sidr victims in 2007. In 2015, MGI donated 9,000 bottles of Fresh Drinking Water
and 4,800 kg of Fresh Flour for the Nepal earthquake victims. Moreover, Mr. Mostafa Kamal also
constructed 44 low-cost houses for poor, homeless and distressed people in local areas.

In 2018, MGI launched a baby care zone at the departure lounge of Hazrat Shahjalal International
Airport in Dhaka. Such a zone, a first of its kind in an airport of the country, will ease the stress of
passengers, especially the mothers travelling with toddlers and young children.

To provide better educational opportunities for the underprivileged students, MGI donated 25 lac
takas to Police Academy KG School Kollyan Fund as a student scholarship at Bangladesh Police
Academy, Sardah in January 2020.

To fight against the novel Coronavirus, MGI donated 5 Crore taka to the Prime Minister's Relief
Fund as well as 35,000 packs of essential foods to the people who need it the most. MGI also
handed over 15,000 masks to the Rapid Action Battalion (RAB) to be used by their officials and
2,000 bags of essential foods that were to be distributed to the people with the help of the RAB.

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With more than 45 years of national and global experience Meghna Group of Industries is
continuing to serve one in every two households in Bangladesh.

Core Values

Openness: diversity is a source of wealth and change, a constant opportunity.

Curiosity: Characterizes an attitude of awareness and looking ahead, of being attuned to others,
refusing to accept preconceived ideas and models and imagination.

Agility: Synonymous with vitality, energy, speed, flexibility and adaptability.

Enthusiasm: There is no limit – only obstacles to be overcome.

Boldness: As opposed to bureaucratic security, it symbolized the desire and capacity to take risks
and explore now, unorthodox paths. It also implies the ability to endure and overcome failure.

Passion: Synonymous with conviction, a drive to convince and lead the pleasure of work, the
ability to surpass oneself and achieve excellence.

Appetite for challenge: Characterized by the optimistic, enthusiastic and almost physical desire
to grow and take the lead.

Humanism: the attention paid to the individuals, whether they are consumers, customers,
employees or citizens, is at the heart of all our decisions.

Sharing: An approach that emphasizes dialogue, transparency and teamwork

Responsibility: MGI pays attention to the safety of people and products, acts pro-socially and is
environmentally friendly

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 Management Structure:

Chairman & Managing Director

Vice Chairman

Director

General Manager

Deputy General Manager

Assistant General Manager

Manager

The strategies that are currently followed by MGI:

Market penetration Strategy: It refers to seek increased market share for present products or
services in present markets by giving greater marketing efforts. They lunched existing product
different level of size (mini pack, family pack and larger pack) and price to attract customers
(potential, existing and less affluent). To increase sales, they are giving attractive offers to purchase
Fresh Atta or Maida, noodles and others products as well in many departmental store and daily
newspapers. Also, they advertise their sales promotional program in many TV channels. The
company targeted toward final buyers (consumer promotions), retailers and wholesalers (trade
promotion).

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Market Development Strategy: It is a growth strategy or organizations to introduce their product
or service to target audiences they have not yet reached or are not yet currently serving. The
company main motives to introduce or serve new geographic area. The company is trying to reach
their product all rural area and district level cross Bangladesh and as well abroad. They try find
out new area and they are product are available or not if not why.

Product development strategy: It refers to the methods and actions used to bring new products to a
market or modify existing products to create new ones. Developing a product has several steps, from
producing an idea of distributing products to customers.

The company develop continuously their existing product and new one. Such as Fresh Noodles & Snacks,
Fresh Majenda, Fresh Dhoom Cola, Fresh Soul Up etc.

Related Diversification strategy: It occurs when the company adds to or expands its existing
related line of production or markets. The company starts manufacturing a new product or
penetrates a new market related to its business activity. Now the company has extended its
beverage lines (Fresh mineral water to carbonated soft drinks). Beverage brands like Fresh Fruit
drinks, Fresh carbonated drinks are some of the famous beverage brands. Future plans for
beverages include introducing milk & milk added drinks.

SWOT Analysis of Meghna Group of Industries

Strength:

Conferred three awards in "Best Brand Award Bangladesh" 2013 organized by Bangladesh Brand
Forum in association with Millward Brown. Super Fresh Drinking Water secured 2nd position in
the category of Bottled Drinking Water. Fresh Atta, Maida, Suji secured 2nd position in the
category of Atta, Maida, Suji. Fresh Soyabean Oil achieved 3rd position among all local brands
across all categories.

ISO 9001:2000, certificate earned by its facilities for quality product and management.
International Star Award for Quality (ISAQ) in Gold category by business initiatives Direction

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(BID) in Geneva, 2005 for commitment to quality and excellence. World Quality Award in
Platinum category in Paris, 2006. Quality Summit Award in Diamond category in New York, 2007
for outstanding performance in quality commitment and industrialization.

Weakness:

MGI has some limitations to run its operations. Most of the employee and worker of factory are
not used to with ERP system. But in MGI FMCG sector it is very much essential to know how to
use ERP to keep information up to date. So in this case to collect information sometimes need to
use manual system, which causes information gap. In FMCG sector should use pull marketing
strategy, but in MGI still they are mostly dependent on push strategy. HR policy of MGI is not so
much strong, which causes dissatisfaction among employee and as a result employee turnover is
high.

Opportunities:

There is a huge opportunity for MGI Industry. It has huge capital and resources to become
multinational company. But in this case, it has to change its position gradually and need to proper
utilization of its resources.

Threats:
Other competitor like Abul khair group, City group, Edible Oil etc. they are big threats for MGI
industry. Those industries create tough competition for MGI industry. Inflation and political instability
cause so many problems, like inflation raise the price of raw materials and instable political situation
causes hamper in delivery process, planning process etc.

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 Culture of Meghna Group Industries

Every achievement, milestone or personal feat is worth making a big deal. MGI take their work
seriously with a hint & pinches of laughter, team work and commitment. A culture of gratitude &
creating a happy workplace is what they work towards every day and strive to. Going beyond the
work, MGI fosters camaraderie at workplace to make every day exciting and challenging. They
encourage employees to take a pause, reflect on successes and revel accomplishments.
Celebrations are a norm and happy workforce is the essential mantra they follow.

In this era of automation, industry change and technological advancement, MGI focuses on agile
learning methods to uncover the potential of its people and expand their horizon of human intellect.
MGI makes leaders of future by providing opportunities to reach new heights by stepping on
staircase to success. They partner with world class organizations to provide customized learning
and development programs for employees, tuned to their specific needs and flexible to their work
schedule.

Diversity is at the core of MGI and also one of the brand pillars. Diversity at MGI is not only about
gender ratio but also equates to people from different walks of life, companies, backgrounds,
ethnicities, regions, religions and genders coming together. MGI brandishes the best diversity ratio
amongst any industry. MGI is an equal opportunities workforce. Each employee of MGI lives and
breathes its Core Values and Cultural Priorities. They endorse open communication and diverse
culture where different cultures provide the best to customers.

In globalization competitive environment, leaders can be expatriates. They need to have multiple
competencies to deal with challenges like cross border transaction. I think it is important for them
to create different culture initiatives by allowing employees to extent their thinking and actions
more & more. “Creativity” can be one of the useful methods when dealing with multiple
challenges. “Creativity” means doing things from a different way, leaders must learn different
culture from people outside the system.