CHAPTER-1 PROFILE OF THE COMPANY

1. ABOUT THE COMPANY

Kajaria Ceramics is the largest manufacturer of ceramic/vitrified tiles in India. It has an

annual aggregate capacity of 68 mn. sq. meters, distributed across seven plants -
Sikandrabad in Uttar Pradesh, Gailpur & Malootana in Rajasthan, three plants in Gujarat
and one at Vijayawada in Andhra Pradesh.

Kajaria's the manufacturing units are equipped with cutting edge modern technology.
Intense automation, robotic car application and a zero chance for human error are few
reasons for Kajaria to be the number 1 in the industry.

Founded 30 years ago, Kajaria has since then grown stronger with its hard work,
innovations and patronage from our discerning customers.

The Indian consumers' rapidly growing appetite for style and aesthetics is the inspiration
behind every design of Kajaria and its pace to keep up with the customer and market
demands has made Kajaria a synonym for quality, service and innovation - not only in the
domestic market but in the international market too.

Kajaria Ceramics has increased its capacity from 1 mn. sq. mtrs to 68 mn. sq. mtrs. in last
30 years and offers more than 2800 options in ceramic wall & floor tiles, vitrified tiles,
designer tiles and much more. These tiles come in a wide range of colours and textures to
complement bathrooms, living rooms, corridors, study rooms & kitchen, born out of an
inspired creativity of those who feel that rooms should be an extension of the beauty
reflected. With an unparalleled commitment towards quality we have strived to adopt
technologies and standards with the changing times.

Be it technology, research, design or quality, Kajaria has set its sight on all these factors
adopting new production techniques in order to enhance the quality of its products. Due
to creativity and design ability of our team, our design comprises both innovation and
exclusivity.

Leveraging the two invaluable assets - the Kajaria brand and unparalleled, multi-layer
distribution network - to expand the product bouquet to cater to the growing aspirations
of the discerning Indian customers.

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2. OBJECTIVE OF THE STUDY

1. To Work & gain knowledge of real business environment & corporate culture.

2. The objective of this study is to understand the concept of marketing Research

and Sales Promotion, its benefits and implementation process.

3. To evaluate the effectiveness of Kajaria Ceramics as a promotional tool.

4. To identify the problems associated with Kajaria Ceramics in the Indian scenario.
5. Market analysis.

3. PROFILE OF THE COMPANY

3.1. Nature of the firm
The company was incorporated in December, 1985 with an object of setting up Ceramic
Tile Plant with an initial capacity of 12,000 MT at Sikandrabad (U P) in technical
collaboration with Todagres SA, Spain. The company had started the commercial
production on 12th August, 1988. Since then, the company has expanded its capacity at
its existing location for floor tiles twice during 1990-91 and 91-92 by 14,000 MT each
taking its floor tile capacity 40,000 TPA. In 1993-94, the company added Wall Tile
capacity of 20,000 TPA with Monoporosa technology which was expanded to 40,000
TPA in 1995-96. The company set up a green field Plant at Village Gailpur (Rajasthan)
of 70,000 MT capacity for the manufacture of Monocuttra Wall tiles in March, 1998.
The company carried out the modernization of its existing Plant at Sikandrabad in
January, 99, which has resulted increase in capacity from 80,000 MT to 90,000 MT and
enhancing the life of the Plant. The total present capacity of the company is 170,000 MT.

Both the Plants have adopted single firing technology (Monoporosa technology), which is
the most latest, cost efficient and more productive technology. The company is
marketing its products since inception under the brand name of „Kajaria‟ which is a well-
known brand within the industry in India and abroad. The company has also been
selected as one of the top performing Global Growth Company from India by World
Economic Forum in 1997. Kajaria is the first ceramic tile company in India and may be
5th in the world accredited with ISO 9002 certification for its quality system. During the
year the company has also been accredited with the “ISO 14001” certification for the

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Environmental Management System for manufacturing Ceramic Tiles. The company is
the No. 1preferred company for ceramic tiles in India. The company has also been given
OHSAS 18001 certificate by M/s. TUV Suddeutschland, Germany. The Certificate has
been given for the commitment of the company for fulfilling international standards in
Occupational Health and Safety Management System - Specification.

Kajaria Ceramics is the first ceramic tile company in the world to get this certification.
Kajaria has an all India network of 600 dealers. Kajaria is selling 80% of its products to
the retail consumer and 20% to the projects. Since last year company has franchised
exclusive tile Shoppe & tile galleria on all India bases. It displays the mock bathroom &
kitchen with various combinations of tiles. It helps in selection of the product/ design for
the floor & walls. These also have customer support staff, which advises on sizes,
combinations & laying techniques. The company has opened 11 retail European styled
showrooms located in various parts of the country. Kajaria Ceramics has also opened a
showroom in Melbourne, Australia.

The company is the largest exporter of ceramic tiles from India and accounts for 40% of
total exports of ceramic tiles from India. The Company‟s exports are mainly to Australia,
Sri Lanka, Bahrain, UAE, Saudi Arabia and Oman. The company has won 7 exports
award including the National Export award given in May 2000.

The company has closed the Financial Year 2009-10 with a turnover of Rs 7667.54
million as against the turnover of Rs 6911.99 million in the corresponding financial year.
The turnover is high mainly because of increase in demand in domestic market, effective
cost control measures, better cash management andreduction in the interest rate. The
company has closed the turnover of the 1st quarter of 2009-10 is 1598.8 million which
ends on 30th of June.

MARKETING PATTERN

We have a manufacturing unit at Sikandrabad, Distt. Bulandshahar [U.P.] and the other at

Village- Gailput, Distt. Alwar (Raj.). We are manufacturing Floor Tiles at Sikandrabad

Plant & Wall Tiles at Gailpur Plant. We sell our goods through dealers and also directly

to Builders, Contractors and others. The prices are charged as per price lists applicable

for the particular area. On all the clearances the Excise Duty is being paid under Section

4A on M.R.P. less abatement. The goods are delivering at the Factory gate to the Buyer/

on behalf of the Buyer to the transporter. The freight at actual is paid by the Dealer/Buyer

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directly to the transporter at destination. In few cases, the freight at actual is paid by us

which is show separately in the Invoice and realized from the buyer/dealer.

MAJOR COMPETITORS OF KCL

Name of organization State

NITCO MAHARASHTRA

H & R JOHNSON MAHARASHTRA MP, KA

SOMANY PILKINGTONS HR, GJ

SPARTEK CERAMICS ANDHRA PRADESH

BELL CERAMICS GJ, KA

REGENCY CERAMICS ANDHRA PRADESH

REGMA CERAMICS TAMIL NADU

SAINTINY CERAMICS ANDHRA PRADESH

SUNEARTH CERAMICS MAHARASHTRA

ORIENT CERAMICS UTTER PRADESH

ANANTRAJ INDUSTRIES HARYANA

SAVANA TILES GUJARAT

MURUDESHWER CERAMICS KARNATAKA

EURO CERAMICS GUJARAT

GOLD COIN CERAMICS GUJARAT

3.2. COMPANY‟S BUSINESS MISSION & OBJECTIVES

BUSINESS MISSION
To maintain a leading position as suppliers of Ceramic Wall & Floor Tiles the company
utilizes its capabilities and resources to expand the business into allied areas and other
priority sectors of the economy like housing projects etc…

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BUSINESS OBJECTIVES
1. GROWTH- Expectations to ensure a steady growth by enhancing the competitive
edge of Kajaria Ceramics Ltd.

2. PROFITABILITY- To provide a reasonable and adequate return on capital

employed, primarily through improvements in operational efficiency, capacity
utilization, productivity and generate adequate internal resources to finance the
company‟s growth.

3. CUSTOMER FOCUS- To build a high degree of customer confidence by

providing increased value for his money through international standards of
product quality, performance and superior services through dealer network.

4. PEOPLE – ORIENTATION- To enable each employee to achieve his potential,

improve his capabilities, perceive his role and responsibilities and participate and
contribute positively to the growth and success of the company. To invest in
human resources continuously and be alive to their needs.

5. TECHNOLOGY- Achieve technological excellence in operations by

development of indigenous technologies and efficient absorption and adaptations
of imported technologies to suit business need and priorities and provide the
competitive advantage to the company.

6. IMAGE- To fulfill and the comply the relevant legislation regulations and the
expectations which employees, customers and the country at large have from
Kajaria Ceramics Ltd.

3.3. PRODUCT PROVIDED BY Kajaria

Adore the sophistication and exclusivity on your walls and floors with our unmatchable
series of tiles suitable for bathroom, kitchen, bedroom, living room, exterior and
commercial spaces. These tiles are available in ceramic and vitrified material.

WALL TILES
Kajaria Ceramics brings to you premium wall tiles that are detailed with perfection. Each
tile is made using state of the art technology making them strong, durable & easy to
maintain.

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BATHROOM WALL TILES
Kajaria presents a supreme range of bathroom wall tiles. The all-new assortment of
bathroom tiles is an epitome of creativity and advanced technology. Give your bathroom
a makeover with our exclusive and classy range of wall tiles. We have categories ranging
from ceramic tiles, glazed vitrified tiles & polished vitrified tiles, which comprises a huge
variety of bathroom tiling. Wall tiles of these ranges are available in voluminous colours,
patterns, sizes to give your space an astonishing look. This eclectic collection comes in
glossy as well as matt finish.

KITCHEN WALL TILES

Kajaria Ceramics' exquisite range of kitchen wall tiles are a connoisseurs dream. Each
kitchen wall tile is made using ultra-modern technology which enables us to produce
futuristic designs that are not only beautiful but also strong and durable. Our frequent
quality checks ensure that every kitchen wall tile that reaches our customers is of
exceptional quality. The designer tiles are sure to leave everyone mesmerized with their
unique motifs and splendid colour schemes. Our range of kitchen wall tiles vary from the
old classics to ultra-modern enabling us to cater to the personalized needs of our
customers.

BEDROOM WALL TILES

A very stylish and quick way to break the visual monotony of your bedroom is to upgrade
the room walls using wall tiles. It will not only make your room look trendy but robust
also. Kajaria makes some super stylish wall tiles for the bedrooms that involve
unparalleled artistry and innovative technology. These tiles are crafted to perfection and
can be used in many ways.

LIVING ROOM WALL TILES

A very stylish and quick way to break the visual monotony of your living room is to
upgrade the room walls using wall tiles. It will not only make your room look trendy but
robust also. Kajaria makes some super stylish wall tiles for the living rooms that involve
unparalleled artistry and innovative technology. These tiles are crafted to perfection and
can be used in many ways.

OUTDOOR WALL TILES

A great product is created from the matchless craftsmanship and ingenious technology
just as the exterior wall tiles crafted by Kajaria. These tiles are made to perfection and are
versatile to be used in many different ways. Hence, they provide you complete liberty to
unbridle your imaginations, making your own tailored space. With the aesthetic appeal in
both shape and design, the exterior wall tiles by Kajaria offer high resistance and robust
appearance to the outer walls. These tiles create a remarkable imprint of modern and
stylish interior, enriching the space exquisitely.

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COMMERCIAL SPACES WALL TILES
Kajaria outshines at meeting the requirements and specifications of the offices, hotels,
restaurants, cafe, and other commercial places by providing them the wall tiles of the
finest quality. Ranging from simple to extravagant, the collection of wall tiles is huge,
diverse and magnificent. Our unbelievable series of wall tiles comes in extensive textures
that would absolutely match your furniture and complement interior of the area. Apart
from having superb looks our tiles are also tough, durable and easy to maintain.

FLOOR TILES
Kajaria Ceramics’ range of luxurious floor tiles integrates technological expertise with
exquisite designs. Each tile is crafted using ultra-modern technology to ensure high
quality.

BATHROOM FLOOR TILES

Kajaria presents the new extravagant range of tiles that come with astounding features.
The innovative collection of matt finish tiles consists of a variety of spectacular designs
which will surely provide a sense of wideness to the area with a dash of sophistication &
style. As matt surfaces offer better grip and resistance, such matt finish tiles are the
evident choice for flooring as well as wall tiling, especially in bathrooms. Unlike lustrous
tiles, matt tiles are far better in hiding dirt, blotches, and stains of droplets. Therefore,
they don’t involve repeated cleaning. Another feature of these tiles is, they are low on
maintenance, thus, makes them the very obvious option to be used in the public
bathrooms.
The matt finish tiles come in a non-glossy texture and slip resistant feature with a rustic
feel to it. Apart from bathrooms, these durable tiles can be installed in other indoor and
outdoor areas of the property
KITCHEN FLOOR TILES
Kajaria’s grand range of exquisite kitchens floor tiles are a feast for eyes. The ultimate
collection has the ability to transform any plain Jane dimension to an ultra-gorgeous one.
The designer tiles are made using state-of-the art technology to ensure that each kitchen
floor tile is of high quality. Our tiles are a perfect blend of mind-blowing designs with
appealing colours and extraordinary finishes. The large collection is made to cater the
individual styles and needs of our customers. Our constant quality checks and diligent
workers ensure that we produce the best quality tiles.

BEDROOM FLOOR TILES

Revamp your house with an eye-catching range of bedroom floor tiles by Kajaria.
Manufactured with the help of advanced digital machinery, the assortment of floor tiles
comes in various textures, and dimensions to match the interior of your house. The
polished tiles by the brand have a reflective surface that effortlessly brighten up the
whole area. The radiance of the floor tiles is durable and easy to keep up. To add that

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earthy and rustic look of natural wood to your bedroom room, choose from our eclectic
collection of wooden floor tiles.

LIVING ROOM FLOOR TILES

Revamp your house with an eye-catching range of living room floor tiles by Kajaria.
Manufactured with the help of advanced digital machinery, the assortment of floor tiles
comes in various textures, and dimensions to match the interior of your house. The
polished tiles by the brand have a reflective surface that effortlessly brighten up the
whole area. The radiance of the floor tiles is durable and easy to keep up. To add that
earthy and rustic look of natural wood to your living room, choose from our eclectic
collection of wooden floor tiles.

OUTDOOR FLOOR TILES

Kajaria is known for its exclusive range of ceramic tiles in India including many
tremendous variants, anti-slip floor tiles being the most used and innovative ones. These
floor tiles have been crafted to meet your need, style and most importantly the safety
requirement. Our wide-ranging collection features various finishes that will allow you to
add that extra zing to your space. The collection of Anti-slip tiles comes with a good
quality and assured safety. With in-depth research and innovation, we’ve have created a
product which is best used for bathrooms, kitchens, ramps, swimming pools etc.

COMMERCIAL SPACES FLOOR TILES

Our range of floor tiles is as huge as ever! It is an amalgamation of industrial proficiency
and exquisite designs. Each tile is made with excellence using the most advanced
equipment and technology to ensure great quality. These exceptional floor tiles are also
best commercial spaces shopping malls, restaurant, fashion store, office reception, hotels
etc.

3.4. SIZE OF THE ORGANIZATION

Kajaria is a large organization so their manpower is around 200-350 Employees working
for the organization to get better result in the market. India being one of the largest
domestic market and has emerged 2nd largest consumer of ceramic / vitrified tiles in the
world and very well positioned to take the mantle of a Global manufacturing base.
Kajaria Ceramics Ltd has played its own role in achieving this goal. Since our founding
in mid 1988, we have been moving forward on many fronts to capitalize on solid growth
opportunities, to improve our operating efficiency and to sharpen our business portfolio's
focus. Today, as a result of our internal growth initiatives and several strategic and
innovative initiatives, our business has grown many folds and we have emerged as the
largest manufacturer of ceramic/vitrified tiles with an aggregate capacity of 68 million sq.
mtrs.
In FY 2018-19, we achieved a turnover of Rs. 2956 crore and aiming for industry beating
growth in FY 2019-20.

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Apart from growth, the company is focusing up on larger consumer satisfaction in the
years to come.
No. Of employees in the organization- 200-350

3.5. ORGANISATION STRUCTURE OF THE COMPANY

An organizational structure defines how activities such as task allocation, coordination
and supervision and directed toward the achievement of organizational aims.
Organizations need to be efficient, flexible, innovative and caring to achieve a sustainable
competitive advantage, Organizational structure can also be considered as the viewing
glass or perspective through which individuals see their organization and its environment.

The firm Kajaria is large enough to have such a long level of hierarchical organization
structure, but the firm still follows open door policies where anyone can approach anyone
& anytime. Each department have one head who is leading the whole team as a team
leader to achieve the organizational objective of the firm along with their individual
objective.

The structure used in Kajaria is Functional Approach. In this organization structure, first
is Chairman, then comes jt. managing director, then vice president, then General
Manager, then Assistant General Manager, then Sr. Manager, then Manager, then
Assistant manager and so on . It goes for all department in the company .

3.6. MARKET SHARE & POSITION OF THE COMPANY IN THE INDUSTRY

Kajaria Ceramics is the largest manufacturer of ceramic/vitrified tiles in India with a
product basket of more than 2,600 varieties of ceramic and vitrified tiles. It has an annual
aggregate capacity of 63.90 mn. sq.
Investment Rationale

Well-diversified product portfolio

The company boasts of a broad-based product portfolio that straddles across different
pricepoints to capture customers across the value chain ranging from low-end tiles to
premium glazed tiles. In the polished vitrified tiles, the company offers value tiles of
soluble salts (commodity products) to high end double-charge tiles for premium
customers. Likewise, apart from manufacturing regular ceramic wall & floor tiles the
company also caters to hidefinition polished digital ceramic tiles. The company’s
continuous focus on developing new and innovative products has aided the company in
augmenting market share and strengthening its brand equity.

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 Strong brand recall

Kajaria enjoys strong brand recall given its broad-based product portfolio, well-
entrenched distributor network and significant investment in brand building over the
years translating into a dominant market share. Further the company has expanded its
business from tiles to manufacturing of sanitaryware and faucets under the brand Kerovit.
This has helped the company to position itself as a holistic bathroom solutions provider.

Positive macro policies to drive growth

The government’s focus on affordable housing and building of smart cities coupled with
thrust on Housing for All by 2022 bodes well for the growth of the domestic tile industry.
Besides, the implementation of GST will prove to be a game changer for the ceramic tile
industry as majority of the domestic tile industry is dominated by regional
brands/unbranded players. Given Kajaria’s dominant market position, pan-India
presence, strong distribution network and adequate capacity, we believe the company is
set to benefit from this transition from unorganised to organized.

Capacity expansion to help sustain growth momentum

Kajaria is adding 3.5 MSM ceramic wall and floor tile manufacturing capacity at its
Gailpur (Rajasthan) plant which is expected to be completed by September 2017.
Additionally, it is also setting up a 5 MSM GVT manufacturing unit through its joint
venture partner Floera Ceramic in South India which is expected to be commission by
September 2018. Apart from this, it has set a target of reaching 100 MSM of tiles
capacity by 2020 through greenfield, brownfield and inorganic initiatives. We believe the
capacity expansion drive will not only help the company in fortifying its leadership
strength but will also aid in capturing any incremental demand revival. Hence, we factor
volumes CAGR of 11% over FY17-19E.

Valuations: Kajaria’s dominant position coupled with impressive brand stregth,

exapnding product portfolio, sustained market share gains and sound balalnce sheet
strength will drive growth going ahead. Consequently, we estimate consolidated
revenue/PAT to grow at a CAGR of 15%/22% over FY17-19E. The stock currently
trades at 41.3x/31x FY18E/19E EPS. We value the stock at 34x FY19E EPS arriving at a
target price (TP) of Rs. 802. Recommend HOLD.

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During the year, the company has registered a turnover of Rs.7667.54 Million as

compared to Rs.6911.99 million in the previous year, showing a growth of more than

11%. Despite cut in Natural Gas supply at Sikandrabad Plant and substantial increase in

fuel prices, the profit before interest, dep & tax has increased from Rs.127.5 million to

Rs.514.4 million showing an increase of 304%, The profit for the year has been higher

mainly on account of increased demand in domestic market, effective cost control

measures, better cash management and reduction in the interest cost

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4. ORGANISATIONAL CULTURE
People at Kajaria follow their values (Honesty, Integrity, Loyalty, Accountability,

Passion, Responsibilities, & Understanding) in their day-to-day functioning. The

management at Kajaria ensures that people follow its vision and values by incorporating

Value, Vision, and Roles. The values of the organization are related to the important

spheres of service and emphasis is laid by the employees to follow these values in their

day to day work life.

CHAPTER – 2 ENVIRONMENT ANALYSIS

(2.1) INTERNAL ENVIRONMENT ANALYSIS

(2.1.1) Strengths and weaknesses of the company

STRENGTHS

Low cost Producer of quality tiles. Flexible manufacturing set-up for longer uniformity of
product and comprising to international standards fully adaptation, absorption of
technology.

WEAKNESSES & RISKS

The ceramic tiles industry is dependent on the growth in the construction and housing
sector. In the Budget 02-03, tiles have been delisted from the SSI category and
accordingly all manufacturers of tiles come in the excise net. To some extent they have
arrived at the competitive level to the organized sector. But due to their negligible
overheads, tax evasion and copies of designs of organized sector that retains the potential

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to under cut the organized sector. There is a stiff competition within the organized sector
which is putting pressure on the price also.

OPPORTUNITIES

Strong distribution network across the country and overseas market. With focus on retail
marketing to build and establish exclusive showrooms across the country and overseas
markets. Using innovative display and communicating to customers through exhibitions
and trade shows for consistent brand building efforts. Nurturing and cultivating highly
skilled human work force by motivating and rewarding them.

THREATS

The Company is continuously on the path to over come any threats arising from imports /
competition amongst the tile manufacturers by making the product more competitive in
terms of price and quality, which has been possible by reducing the input costs and
providing more value added items with dynamic range of designs and colours.

(2.1.2) BEST PRACTICES OR USPS FOLLOWED BY THE COMPANY:

1. QUALITY PRODUCT

We are committed to excel in all areas of Management to be a leader in the manufacture

of Ceramic Glazed Floor and Wall Tiles by complying with the requirements of our
customers, National and International Standards.

We shall achieve this through continual improvement in our Quality Management System
by increasing the productivity, reducing the costs, updating and up-gradation of
technology, optimum utilization of resources and active involvement of all employees.

Kajaria provide the best quality product to the customer thats why the customer get
higher satisfaction from the product that the campany is providing to the customer .

2. PRICING

As the kajaria is the leading brand in the tile industry due the in which the production is

done that is india because in the india all the capital i.e manpower the company gets in

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 the very cheap rates that’s why the company is able to give high quality product to the

customer at very low and good price . this is why the pricing of its product is very

reasonable so that every consumer and buy it .

(b) EXTERNAL ENVIRONMENT ANALYSIS

Political factors that impact the firm are:

Political factors play a significant role in determining the factors that can impact the

company’s long term profitability in a certain country or market. They can closely

analyze the following factors before entering or investing in a certain market-

 Level of corruption - especially levels of regulation in Industries.

 Bureaucracy and interference in Industries by government.

 Legal framework for contract enforcement

 Intellectual property protection

 Trade regulations & tariffs related to Industries

 Favored trading partners

 Taxation - tax rates and incentives

 Wage legislation - minimum wage and overtime

 Mandatory employee benefits

 Industrial safety regulations in the Industrials sector

 Regulatory Practices – kajaria has to manage diverse regulations in the various markets it

is present in.

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 Governance System – The present governance system in the industry is facing challenges

and KAJARIA has to keep a close eye on the change in policies.

 Other stakeholders such as non-government organizations, pressure groups, play critical

role in policy making in Strategy & Execution. KAJARIA should closely collaborate

with these organizations so that it can contribute better to the community goals as well as

with corporate goals.

 Changing policies with new government – If there will be a change in the near future in

this prominent market, KAJARIA has to prepare for this eventuality as it can lead to

change of priorities for the sector.

Economic factors that impact the firm are:

The Macro environment factors such as – inflation rate, savings rate, interest rate, foreign

exchange rate and economic cycle determine the aggregate demand and aggregate

investment in an economy. While micro environment factors such as competition norms

impact the competitive advantage of the firm. Economic factors that KAJARIA should

consider while conducting PESTEL analysis are -

 Type of economic system in countries of operation – what type of economic system there

is and how stable it is.

 Exchange rates & stability of host country currency.

 Infrastructure quality in Industrial Goods & Services industry

 Education level in the economy

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 Labor costs and productivity in the economy

 Business cycle stage (e.g. prosperity, recession, recovery)

 Economic growth rate

 Unemployment rate

 Increasing liberalization of trade policy can help KAJARIA to invest further into the

regions which are so far offlimits to the firm.

 Inflation rate – The easy liquidity in the market post the great recession of 2018 will lead

to increasing inflation in the market. It can impact the KAJARIA consumers

 Skill level of workforce in the present market – KAJARIA can leverage good skill level

of employees in the present market to not only improve services in Strategy & Execution

but also leverage those skills to create global opportunities.

 Efficiency of financial markets – KAJARIA can access vibrant financial markets and

easy availability of liquidity in the equity market to expand further globally.

 Economic Cycles – The performance of KAJARIA in Strategy & Execution is closely

correlated to the economic performance of the country it is present in.

Social factors that impact the firm are:

Society’s culture and way of doing things impact the culture of an organization in an

environment. Shared beliefs and attitudes of the population play a great role in how

marketers at KAJARIA will understand the customers of a given market and how they

design the marketing message for Industrial consumers. Social factors that leadership of

KAJARIA should analyze for PESTEL analysis are -

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 Class structure, hierarchy and power structure in the society.

 Culture (gender roles, social conventions etc.)

 Entrepreneurial spirit and broader nature of the society. Some societies encourage

entrepreneurship while some don’t.

 Attitudes (health, environmental consciousness, etc.)

 Societal norms and hierarchy – It should strive to build a local team that understands the

societal norms and attitudes better to serve the customers

 Demographics – For better Strategy & Execution, KAJARIA needs to have demographics

on its side.

 Media outlets play a critical role in influencing the public opinion. Both traditional media

and social media are rapidly growing, KAJARIA can increase this trend to build efficient

marketing network.

 Leisure interests – the customers that KAJARIA usually targets give very high

preferences to experiential products and services. Thus the firm needs to spend more

energy to meet the preferences and expectations.

 Education level – The education level is high in the KAJARIA existing markets.

Company should build a R&D center in the local market.

Technological factors that impact the firm are:

Technology is fast disrupting various industries across the board. A firm should not only

do technological analysis of the industry but also the speed at which technology disrupts

that industry. Slow speed will give more time while fast speed of technological disruption

17
 may give a firm little time to cope and be profitable. Technology analysis involves

understanding the following impacts -

 Recent technological developments by KAJARIA’s competitors

 Technology's impact on product offering

 Impact on value chain structure in Industries

 Rate of technological diffusion

 Technological innovation is fast disrupting the supply chain model of KAJARIA as it is

providing greater access to information to channel partners, leading to higher profit

sharing.

 Intellectual property rights and patents protection – If KAJARIA and the sector as whole

will have higher safeguards for IPR and other intellectual property rights then more

players are likely to invest into research and development.

 Maturity of technology – The technology in this sector is still at lower stage and most

players are eagerly waiting for new innovations that can enable them to get higher market

share.

Environmental factors that impact the firm are:

Different markets have different norms or environmental standards which can impact the

profitability of an organization in those markets. Even within a country often states can

have different environmental laws and liability laws. Before entering new markets or

starting a new business in existing market, the firm should carefully evaluate the

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 environmental standards that are required to operate in those markets. Some of the

environmental factors that a firm should consider beforehand are -

 Weather

 Climate change

 Air and water pollution regulations in Industrial Goods & Services industry

 Attitudes toward “green” or ecological products

 Customer activism – Greater awareness among customers have also put environmental

factors at the center of KAJARIA strategy. Customers expect KAJARIA to adhere to not

only legal standards but also to exceed them to become responsible stakeholder in the

community.

 Waste management especially for units close to the urban cities has taken increasing

importance for players. Government is fast coming up with strict norms for waste

management in the urban areas.

 Renewable technology is also another interesting area. It can leverage the trends in this

sector. Many governments are providing subsidies to invest in the renewable sector.

 Environmental norms are also altering the services. Certifications are given on

environmental standards and expectations rather than catering to traditional value

propositions.

 Recycling is fast emerging as a norm rather than a -good thing to do- in many economies.

KAJARIA has to make plans to adhere to regulations and meet consumer expectations.

Legal factors that impact the firm are:

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 In number of countries, the legal framework and institutions are not robust enough to

protect the intellectual property rights of an organization. A firm should carefully

evaluate before entering such markets as it can lead to theft of organization’s secret sauce

thus the overall competitive edge. Some of the legal factors that KAJARIA leadership

should consider while entering a new market are -

 Discrimination law

 Copyright, patents / Intellectual property law

 Consumer protection and e-commerce

 Data Protection

 Environment Laws and guides – The level of environmental laws in the country and what

KAJARIA needs to do to meet those laws and regulations.

 Time take for business cases in court – some countries even though follow international

norms but the time for resolution often run in years. KAJARIA has to carefully consider

average time of specific cases before entering an international market.

 Health and safety norms in the country and what KAJARIA needs to do to meet those

norms and what will be the cost of meeting those norms.

 Legal protection of intellectual property, patents, copyrights, and other IPR rights in

various countries. How KAJARIA will be impacted if there is not enough protection.

Opportunities

1. New Industries.

2. Training.

3. Exploring Emerging Markets

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 4. Expanding Market for People Predicting Analytics

5. Employee Development

6. Ask current customers to refer business

7. Use social media and blogging to build brand name and gain new customers

8. Expand business nationally

9. Target smaller start-ups who needed strong marketing to get their business off

the ground

10. Provide sales support services for clients

Threats

1. Changing Laws.

2. Larger Competitors.

3. Tough Competition

4. Large and Medium consultancies in emerging markets

5. Less Demand in Certain Industries.

6. A number of local competitors were already blogging and utilizing social media

7. Lots of individuals and other new small businesses “popping” up who do

marketing consulting

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