Diversification strategy - Amul

Diversification strategy - Amul - GCMMF: Diversifiy or not...

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GCMMF: Diversifiy or not
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Background With the liberalization of the Indian economy in the early 1990s, and the subsequent entry of new players, there was a change in lifestyles and the food tastes of people. The new team that took over the management of the GCMMF in the mid- 1990s hoped to take advantage of the change. They set higher benchmarks (in terms of
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Pros & Cons Helped Amul broaden its appeal across all segments. Price advantage - Amul's products were priced 20-40 % less than those of its competitors. Amul could price its products low because of the economies of scale. Amul's obsession with keeping down manpower costs and dealer commissions
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Status - Year 2000 Milk market – saturated from the supply side. Analysis of Vegetables & Fruit market – Land Increase in land (96-97 to 97-98) Gujarat’s share of market (in mn tons) Fruits 3.7 mn hectares 2.9% 1.82 / 22 (8.2%) Vegetable s 5.63 mn hectares Nil 2.25 / 50 (4.5%)
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Financial Data – Exhibit 7 1995-96 1996-97 1997-98 1998-99 Net Profit 81.79 77.85 84.80 130.12 Cash & Bank balance 527.82 591.65 414.00 528.34
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This note was uploaded on 02/19/2012 for the course FINANCE pgpx-11 taught by Professor Prof.mrdixit during the Spring '12 term at IIM Bangalore.

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Diversification strategy - Amul - GCMMF: Diversifiy or not...

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