SWOT – HDFC

SWOT Analysis

Strengths
1. HDFC is the strongest and most venerable play on Indian mortgages over the long term. The management of the bank is termed to be one of the best in the country.
2. HDFC has differentiated itself from its peers with its diversified network and revamped distribution strategy
3. HDFC has been highly proactive in passing on the cost and benefit to customers.
4. Besides the core business, HDFC’s insurance, AMC, banking, BPO, and real estate private equity businesses are also growing at a rapid pace and the estimated value of its investments/subsidiaries explains ~30% of HDFC’s market capitalization.

Weaknesses
1. High dependence on individual loans.
2. Major stake held by American financial groups which are under stress due to economic slowdown.

Opportunities
1. Fast growing insurance business in the country.
2. Untapped rural markets.

Threats
1. Loss of market share to commercial banks and HFC’s
2. Higher than expected increase in funding cost
3. Risk of fraud and NPA accretion due to increase in interest rates and fall in property prices is inherent to the mortgage business.

SWOT - ICICI Bank

SWOT Analysis

Strengths

Brand name: earned a reputation for extending quality services.

Huge network: ICICI Bank has the highest number of linked branches in the country. The bank operates through a network of 450 BRANCHES AND over 1800 ATMs across India.

Diversified portfolio: ICICI Bank has umbrella of products to offer their customers like retail banking, Insurance, Demat services, personal loans etc.

Aggressive Marketing: ICICI Bank is known for its aggressive marketing of its products. Recent Endorsement of its product by AMITABH BAHCHAN proves the same.

Technology: ICICI bank’s technology platform has been acknowledged globally as one of the best in terms of robustness, flexibility and cost efficiency.

Salary accounts: ICICI is having an edge over other banks in case of Salary Accounts because of huge network

Weaknesses

Poor customer service: Though most of the companies are satisfied with the products offered by ICICI bank, the poor customer support/ service is creating a lot of dissatisfaction among the customers.

Little presence outside India: ICICI Bank is having little presence Outside India, because of which companies prefer MNC Bank, mainly Citibank.

High transaction costs: ICICI Bank charges high cost for its transactions. Customers are using only those facilities of ICICI Bank which are provided at cheaper rates (Salary Account) and for other services they are going to nationalize banks and MNCs (Foreign exchange)

Focus mainly on high end customers: The bank targets only the top bracket of clients and does not cater to the needs of small customers. Due to this reason the bank may sometimes loose good clients.

Opportunities

Increasing individual incomes in India.

New companies: Sectors like IT and ITES are on a boom in the Indian market context, with new companies mushrooming in the market.

Banking sectors that are planned by Indian government increase the possibility of lots of new services in banking.

Threats

Advent of MNC banks: Large numbers of MNC banks are mushrooming in the Indian market due to the friendly policies adopted by the government.

Ever improving nationalized banks: With PSU banks like SBI going all out to compete with the private banks and government giving them a free hand to do increases competition from nationalized banks as well.

SWOT - Barclays

SWOT Analysis

Strengths:

• The bank started first started in 1690 and enjoys strong market penetration.
• It was the first bank to launch credit cards in UK and thus the brand has become ingrained in the psyche of the consumers. This is further reinforced with the sponsorship deal for the English Premier League.
• Robust financial performance
• Increasing online security to combat fraud. The software will provide greater protection against such fraud.
• Geographically diversified operations.

Weaknesses:

• The company has a very small presence in the emerging markets of Asia. This can prove to be a strategic error of colossal nature. Nonetheless, this situation can also be turned into an opportunity.
• Lower profit margins. The 2 billion pound write-down in the value of risky assets, led to a fall in profit of 32%
• Low return on assets.

Opportunities:

• Expansion into new emerging markets like India. In fact the Barclays credit card was launched in India just a few months ago.
• Acquire a company to inorganically expand its business. Barclays tried unsuccessfully to acquire ABN AMRO of Netherlands. Now it is looking at some of the financial firms in the US like Lehman and UBS.
• Buoyant asset management market
• Positive outlook for global banking industry

Threats:

• With the high likelihood of Barclays acquiring another financial firm of similar size, it would face huge post-merger integration challenges. This would especially be sharp given its failed attempt to broker a deal with ABN AMRO. There would be negative perception and resistance among the employees of the potential target.
• The latest industry figures show that internet and e-commerce fraud on cards rose 45% in 2007, through skimming, data hacking or unsolicited emails or phone calls. This is a huge potential threat to Barclays in the future.

SWOT - HUL

SWOT Analysis

Strengths
1. Strong and well differentiated brands with leading share positions
2. Distinctly placed products providing reach to every segment of society.
3. Consumer understanding and systems for building consumer insight
4. Integrated supply chain and well spread manufacturing units
5. Distribution structure with wide reach, high quality coverage – The launch of project “Shakti” has helped HUL to create brand awareness and extensive reach in rural India.
6. Access to Unilever global technology, capability and sharing of best practices from other Unilever companies.
7. Well placed to take advantage of growth in rural India and lower strata of the society through “Shakti”.
8. It could look at introducing products from its parent company like margarine in order to cater to changing consumer tastes and opportunities in food sector.
9. It can be a leader in exports by positioning itself as a sourcing hub for Unilever companies in various countries.

Weaknesses
1. Price positioning in some categories allows for low price competition like Amul captured Kwality’s market.
2. Limited success in changing eating habits of people.
3. Competitors focusing on a particular product and eating up HUL’s share, like Nirma focusing on soaps and detergents.

Opportunities
1. Growing consumer base due to increasing income levels and new consumers from lower strata of the society
2. Untapped market in branded Ayurvedic medicines and other such consumer products.
3. Opportunity in Food sector: changing consumer tastes
4. Expansion of horizons towards more and more countries

Threats
1. Unfavourable raw material prices due to inflation, reducing profitability.
2. Heavy onslaught of competition in the core categories from emerging players like ITC will result in higher advertising expenditure
3. Spurious/counterfeit products in rural areas and small towns.
4. Reduction in real income of consumers due to high inflation.

SWOT - ITC

SWOT ANALYSIS

Strengths:
Cigarettes are the main business. Introduction of VAT on cigarettes could have affected the sales. But the company managed to maintain market leadership and increase volume sales by 16 % last year
Cigarette business: Company uses a unique IT-enabled ‘Six Sigma’ based product development process. This product development process and the deep consumer insights give the company the unique understanding of positioning and brand development of its products.
Cigarette business: initiatives such as contemporary, internationalised packaging for ‘India Kings’ and ‘Gold Flake Kings’, multiple limited Edition Packs and flavour variants for ‘Classic’, etc have resulted in considerable fortification of your Company’s strong position in the premium, value-plus segment of the market.
Cigarette business : Modernization of Primary Manufacturing in Munger, introduction of sophisticated material handling systems at Bengaluru and implementation of cutting edge Norwegian technology – Cold Plasma Odour Abatement Systems – at the Bengaluru and Saharanpur primary manufacturing departments.
FMCG business: Relentless focus on providing consumers well-differentiated best-in-class products, supported by significant investments in product development, innovation, manufacturing technology and unmatched distribution infrastructure have dramatically enhanced brand equity of this business.
FMCG business: Ashirwad and Sunfeast continue to draw upon the agri sourcing strengths of e-Choupal network to gain competitive advantage by obtaining superior quality wheat at competitive costs.
Hotel and lifestyle retail business have shown strong growth because of booming Indian economy.

Weakness:
Cigarette business: The year ahead is fraught with extreme uncertainties, since for the first time in the history of the industry, manufacturers will not be able to position viable offers for consumers of non-filter cigarettes in view of the massive increase in excise duty rates in this segment.
Cigarette business: Harsh regulatory climate for cigarette business presents a daunting operating environment that will, undoubtedly, test the resilience of all legitimate players in the industry.
FMCG business: The year ahead presents a unique challenge to the business in the shape of an unprecedented rise in commodity prices across the board, including wheat, vegetable oil, maize and skimmed milk powder.
FMCG business: Soaring fuel prices and the need growing volumes without adversely impacting margins has been rendered extremely challenging.

Opportunities:
Big Indian market with huge consumption capacity.
ITC is moving into new and emerging sectors including Information Technology, supporting business solutions.
e- choupal is a well thought of initiative taken by ITC which can also be used in other sectors in many other parts of the world. ITC leverages the concept of e-choupal in a novel way. The company researched the tastes of consumers in the northern, western and eastern India of atta, and then used the network to source and create the raw materials from farmers and then blend them for consumers under purposeful brand names. This concept is quite difficult for competitors to emulate.

Threats:
The obvious threat is from competition both domestic as well as international. ITC’s opportunities are likely to be opportunities for other companies as well. Therefore the dynamic of competition will alter in the medium term. Western companies might see India as an exciting opportunity for themselves to find new market segments for their own offerings.
The company is more or less still dependant on its tobacco revenues to fund up its cash guzzling FMCG start up. Cigarettes account for about 47 percent of the company’s turnover. The increasing tax on cigarettes and the growing concern of people regarding the health hazards being caused by smoking can eat up most of the profits of the company.