CCS Mid-Term Project

Consumer Durables

Godrej Vs Voltas

Group 10
1 Ratio Analysis
Godrej Voltas Leverage Ratio

Profitability Ratios
Debt to Equity 0.01 0.02
Return on total assets 11.05 6.32
Interest Coverage ratio 22.56 33.66
Return on equity 15.43 10.47
Activity Ratio

Earnings per share 17.44 17.63 Inventory turnover 2.44 2.39

Price earnings 48.53 63.61 Asset Turnover Ratio 3.84 0.79

Liquidity Ratios
Godrej has better ROA, ROE and asset
Current Ratios 1.35 1.42 turnover. They have generated more and
steady revenue. Diversified product portfolio
Quick Ratio 0.90 0.95 and being top brand in different categories
helps to generate more revenue. Whereas PE
ratio is higher for Voltas and past 5 year
Z-Score of Godrej= 13.51 trends have shown constant share growth
Z- Score of Voltas= 6.75 2
2 3 Circle Model
E: White space- unmet/unfulfilled A: USP’s of Godrej

Needs of customers
A 1. India’s first made in India Refrigerator
E manufacturer and 1st Indian finalist of
1. Less innovation and no new products the Global Cooling Prize
B
2.Not in the segment of vacuum D C 2. Effective 718 Districts-one-service
cleaners and dishwashers, home network for the nation
lightning (LEDs)
3. Introduced virus disinfection
3.Not Producing wifi routers, laptop technologies in products like ACs and
battery packs Washing
C: Cost of doing business B: Industry Standards
D: Competitor’s USP
1. Companies have to invest a significant 1. Use of BEE star rating to denote the
1. Reliable service and vast distributor capital in advertising to acquire new energy efficiency of the appliances.
network. customers.
2. Attaining ISI and BIS certification to
2.Seamless shopping experience from its 2. Brand loyalty and high switching cost ensure a certain level of safety,
website Voltas lounge make it inconvenient for consumers to reliability and performance standard in
switch. the products.
3.All weather air conditioner.
3. High entry barrier in this segment
because of capital intensive production
and high R&D cost. 3
2 3 Circle Model
G: Internal capability and
resources not yet realized (R&D) of
E F
Voltas
1.Voltas and Arcelik joint venture -
Arcelik will bring to the JVC its R&D
and manufacturing specialty along
with product range and global
sourcing capabilities.
2. Innovation on the ‘Adjustable AC’
technology which godrej had
pioneered.
3. Technology upgrades have been
introduced in other categories like
Humidity Control in Air Coolers,
Convertible Freezers in Commercial
Refrigeration range, Store Fresh
technology in Refrigerators, Stain
Removing technology in Washing
Machines, and many others
A
F: Internal capability and
resources not yet realized (R&D) of
B Godrej
D C
1. Strengthening digital ecosystem -
53% increase in digital reach
G
2. Ramping up Ecommerce sales -
dedicated digital team, the ‘Ecom Cell’
charged with rapidly growing online
sales.
3. Started collecting first-party data to
ensure further reach through a
cost-effective and targeted approach.
Furthermore, the cost per
engagement was reduced by 2 times
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3 Strategy Group Map

LG

LG Daikin BlueStar
Godrej
Godrej

Daikin

Voltas BlueStar
Voltas

X-axis- Revenue X-axis- Market Share

Y-axis-Market share Y-axis- Product width
Z-axis-Distribution Network Z-axis- Product Technology
3
X-axis- Revenue
BlueStar Y-axis- Pricing
LG Godrej Z-axis- Product Technology

Daikin Voltas

Strategic Insights:

● On the basis of the strategy group maps, product distribution network could be
the key component in deciding the market leader
● There is negligible differentiation on between different brands on the basis of
the technology being used in these products
● The market leader Godrej has greater product width and a better distribution
network when compared to its competitors
4 Key Resources and Capabilities
Sustainable? Why? So What?
Resources
● Manufacturing facilities in Shirwal, outside of
Pune, Maharashtra and Mohali, Punjab.
● Both became the first manufacturing units in
the country to win the coveted Platinum Green
Co. certification for their efforts in green
manufacturing.
● A state-of-the-art R&D centre in Pirangut on the
outskirts of Pune.
● 29 Manufacturing stations, 3 Hub Warehouses,
22 Branch Warehouses, 14000+ dealers
● 96 exclusive Godrej appliance stores.
● Motivated workforce of 14,150 employees.
● Renewable Energy 7.88 MW installed capacity
for solar power.
Capabilities
● Viroshield. It uses 360-degree disinfecting ultraviolet
technology that sterilises surfaces in a matter of
minutes.
● Introduced virus disinfection technologies in other
products – like ACs and Washing Machines.
● Advanced vaccine refrigerators which protect vaccines
by preserving them at just the right temperature, not
allowing any wastage due to freezing or temperature
fluctuations seen in traditional vaccine refrigerators.
● Only Indian AC brand amongst the top 4 finalists of the
Global Cooling Prize, a prestigious global challenge to
design a cooling solution with five times less climate
impact than the ACs popular today.
● Zero waste to landfills – Close to 99.8% of
non-hazardous waste diverted from landfills.
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 Key Resources and Capabilities
Sustainable? Why? So What?

Sustainable? So, What?

Working on the two major pillars while utilizing its
capabilities and resources makes godrej sustainable:
◦ Continuous improvement, technological advancement
and consumer insights are some of the triggers which
1. Innovating for Good & Green: The goal is to have a
initiate the embedment of sustainability features in the
third of portfolio revenues comprising good and/or
Company’s products and service offerings.
green products and services.

◦ The deeper supplier engagement achieved over last

2. Supply Chain Sustainability: The Company has in
place a Supplier Code of Conduct. The COC serves as a
guidance document for suppliers to meet industry best
practices.
The Company sources its input materials and other
services from across the globe without compromising
on quality and value. The Company continuously works
on optimizing its infrastructure processes and systems
and promote local procurement to deliver competitive
customer service. Preference is given to local suppliers
if they satisfy the requisite specifications.
3-4 years has resulted in creating a good supplier base
more in tune with business ethos , social commitment
and agile business needs of the company. Many of the
supplies have also received national and regional level
awards for the outstanding work in area of kaizan ,
manufacturing practices, energy conservation as well
as CSR work in their communities.
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What are the Industry’s key success factor? And How it evolved over the years &
Predictions?

Key Success factors:

1) Improving Product Technology: Coming with Product that adds value to the customers that gives future
economic benefits
2) Innovations in Ads & Promotions
3) Attractive Locations & Leveraging on digital E- commerce sites
4) Product customisation to address unique requirements of the Indian market
5) Providing More Opportunities to customers
6) Brands need to provide better experiences and services across all product touchpoint
7) Focusing on the consumer’s long-term experience can influence brand loyalty. By taking steps to increase
the lifetime value of products, brands can acquire a customer for life, including products in other
categories

Predictions:
Social Marketing and Engagement:
Concept Stores
Digital Commerce Resources
Owners Hub
Value Added Services
Daily Used Products so it need to be convenient & contextual in every engagement.
9
 Porter’s Diamond Model
Government
• 100% FDI allowed in electronics
hardware manufacturing
• 52 Companies have applied for white
good makers pumping 6000 Cr in next
2-3 years
• Govt. has approved 6238 Cr for ACs &
LCDs
• 5000 Cr for Electronic/Tech product
for 5 years
• Ease of foreign entrants like Xiaomi
has forced Indian brands to reduce
price
• Market size of consumer durables is $ 9.84 Bn in
2021 & it is expected to grow by 21% CAGR &
reach to $ 21.18 Bn in FY 2025
• Citing the change in the preference to foreign
companies, Godrej has been innovative such as
more vent in refrigerators, all Green ACs &
Coolers .
• Godrej introduced tech driven appliances to
connect with the customers as 45% of the
population is below 25 years, Historically the
customer base of Godrej was the age group of
35-45 years.
India can be a good choice as home
base for Godrej Appliance &
Voltas.
• Easy availability of natural resources.
• Skilled labours trained at Godrej & Boyce & Voltas (Tata) research centre
• R&D Centres located in other countries
• Affordable labour
•
Factor • Godrej Appliance & Voltas
Conditions being the subsidiary of Godrej
Group & Tata Group
respectively, these companies
uses the resources from other
Related & companies of the group
Demand • Godrej has 8 R&D Centres,
Supporting Voltas has partnered with
Conditions
Industries Beko for technology
• Market of Godrej is spread in
Strategy, 36+ countries & Voltas in 22
countries
Structure,
• GST on consumer durables is 28%
and Rivalry • Initially taxes were 26-31% & 10% excise
duty on transportation, but under GST,
excised duty is removed which reduces
the cost
• Moreover companies now setup regional
warehouse instead of warehouse in
• Increasing the product line(150+ SKUs), evert territory, it is due to implement of
Innovation, distribution network (Sam-park GST.
model)
• Godrej appliances has 211 employees in
Management, Sales & Marketing verticals rest
functions are controlled by Godrej & Boyce Chance
• Top Rivals: LG, Panasonic, Samsung Whirlpool
& Voltas
 As a young strategy consultant use any
one competitive analysis
tool/framework and list down three
“ strategic recommendations that you
would like to give to the CEOs of two
chosen companies (each) to compete
and or collaborate with each other?

11
Godrej

B2B (Aerospace, Appliances, Chemicals,

Partners and suppliers (real estate.
Consumer products. Industrial
engineering Appliances, Furniture,
Security and agricultural products)
Holding company composed by
subsidiaries (GCPL, Godrej Infotech
Ltd, Godrej Industries Ltd, Godrej
Properties, Godrej Agrovet, Godrej &
Boyce)
Investors
Electricals and Electronics, Green Building Godrej's business diversity
24% of the shares of our Group's Make in India' movement Good & Businesses
Consultancy Services, Material Handling,
holding company are held in trusts Green commitment Corporates
Motors, Security solutions, Vending, Godrej
It exports to more than 60 countries Social responsibility Massive
Efatec, Infotech)
(25 percent of their business is done Trust Government
B2C (agriculture, Audio-visual solutions,
Construction, Furniture, Properties, Locks, overseas)
Precision engineering, Process Equipment,
Tooling, Storage Solutions)

People power
Natural resources Website
1.1 billion consumers globally across consumer goods Stores
Real estate Offices
Appliances Distributors
Agriculture and many other businesses Holding of companies and
Agile and high-performance culture partners
Diversity across their teams
The Godrej India culture Lab
One of India's most trusted brands
Their team members play multi-faceted roles
IP

Real estate Sales of diverse products and services

Employees
Legal
Production cost
Compensations
Marketing
Procurement
12
Voltas

B2B (AC, Cooling & CR Products, Commercial

Partners and suppliers (AC, Cooling
& CR Products, Home Appliances,
Commercial Air Conditioners,
Project Solutions, Textile Machinery
,Mining & Construction Equipment)
Holding company composed by
subsidiaries (Volkart Brothers and
Tata Sons Pvt. Ltd)
Investors
Air Conditioners, Project Solutions, Textile Voltas Limited is a six decade old
company in India with expertise in Air Make in India' movement Businesses
Machinery ,Mining & Construction
Conditioning & Cooling technology. Good & Green commitment Corporates
Equipment)
The company is broadly structured Social responsibility Massive
B2C (AC, Cooling & CR Products, Home
into projects and products business. Trust Governments
Appliances)
With global presence and impact in Countries
14 industries.

SUSTAINABLE PROFITABLE GROWTH

Financial Capital Website
MANUFACTURED CAPITAL Stores
BUILDING CUSTOMER DELIGHT Offices
HIGH- PERFORMANCE CULTURE Distributors
Human Capital Holding of companies and
SOCIAL AND RELATIONSHIP CAPITAL partners
STEPPING TOWARDS A LOW CARBON FUTURE
10 Million+ Consumers
Legacy

Real estate Sales of diverse products and services

Employees
Legal
Production cost
Compensations
Marketing
Procurement
13
 Strategic Recommendations
Godrej
● Continue innovation,
value based pricing
● Go greener initiatives
● Can introduce a newer
market(Mobiles)
Voltas
● Gain consumer insights
● Aware of competition
(adoption to the
dynamic market, lower
aftersales cost)
● Can introduce a newer
segment (TV, Mobiles)

Since both the companies have different visions they should continue being competitors in
the present segment.
While they nurture collaborations so if they both enter a new product ie mobile phones
together would be a feasible option.

14
Group
10 Thank You

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