Friday, May 3, 2013

Restructuring galore

Mint today talks about major restructuring at the senior management level at Tata Motors. MD and CEO Karl Slym has hired his men from GM India to Tata Motors to revive the fortune for Tata Motors in passenger car segment. 5 new faces at the levels of VP into core strategy, marketing, purchase, commercials, quality etc.

Slym who joined Tata Motors India last year has identified 3 problem areas at Tata Motors passenger car segment to improve upon, which are; poor quality, lack of model upgrades and perception that Tata cars are better for only taxis.

BCG recommended Polaris to have a set of 5 CEOs instead of 1. Share prices have fallen 45%. Last 9 months have been flat for them in terms of revenue growth. Attempts to enter and work in African and Brazilian market has not paid off as the Big 4 also have not been able to get any leads in those markets.

Though founder Mr.Arun Jain says revenue has doubled from 2008 till 2012, it appears, the profit margins have seriously dipped as reflected in the share prices getting ~50% dip. Important is the fact to look at companies like MindTree who have around same top-line of $450 mn, have been able to get business and do slightly better than Polaris. In banking and Finance sector, where Polaris plays, scale may be a big factor hitting them  against TCS, CTS and Infosys.

Seems like time of anxiety has prompted thoughts to push for serious change in the way the business was done. All these seem to be positive and radical steps, though analysts may have differing views.

Bharti Airtel has been facing serious operational and employee cost jumps. Employee cost has gone up by 24%. Reliance Telecom's deep pocket is a worry for Bharti Airtel. Bharti Airtel has made some great progress in last 6 months in terms of higher usage by users and given a jump of 5% in revenue due to customer usage. After Sanjay Kapoor got replaced by Gopal Vittal as CEO in March 2013, a leadership change that may serve the purpose and change fate of Bharti Airtel.

No comments:

Post a Comment

Moonlighting and hypocrisy of corporate India..

  MOONLIGHTING CHECKS? WITHOUT FORENSIC TECH AND REGULATIONS? ARE YOU KIDDING US? 5.4 million people work in IT/ITES in India, churning $180...