Strategic Management Project

Strategic Management
Prof. Santosh Tiwari

Submitted by: - Group 1
Nilesh Kumar Gupta
Shubham Dayalapwar
Himansh Sen
Tirthan Mukerjee
Priyanshu Shekhar
Suraj Kumar Sahoo
Company Brief:
Hindalco Industries Limited an Indian aluminium and copper producing organization, is an auxiliary
of the Aditya Birla Group. Its central command are at Mumbai, Maharashtra, India.
The organization has yearly deals of US$15 billion and utilizes around 20,000 people. It is recorded in
the Forbes Global 2000 at 895th rank. Its market capitalisation before the finish of May 2013 was
US$3.4 billion. Hindalco is one of the world's biggest aluminium moving organizations and probably
the greatest maker of essential aluminium in Asia.
The Hindustan Aluminium Corporation Limited was laid out in 1958 by the Aditya Birla Group. In
1962 the organization started creation in Renukoot in Uttar Pradesh making 20 thousand metric tons
each extended time of aluminium metal and 40 thousand metric tons each time of alumina. In 1989
the organization was rebuilt and renamed Hindalco.
Market Stat:
Core Products Market Share
34 23% 5%
9%
66 68% 4%
Aluminium & Subs.

Copper & Subs. HINDALCO BALCO NALCO Others
Strategies they have chosen so far:

On 11 February 2007, the organization went into a consent to procure the Canadian organization
Novelis for US$6 billion, making the joined element the world’s biggest rolled-aluminium producer.
At 2007 Novelis was the world's biggest maker of moved aluminium and a significant recycler of
aluminium cans. On 15 May 2007, the securing was finished with Novelis investors getting $44.93
per exceptional portion of normal stock.
Hindalco, through its entirely claimed auxiliary AV Metals Inc., gained 75,415,536 normal portions
of Novelis, addressing 100% of normal offers. Following shutting, AV Metals Inc. moved the normal
portions of Novelis to its completely claimed auxiliary AV Aluminium Inc. At the point when
Hindalco made this bid in 2007 this turned into the biggest Indian interest in North America and the
second-biggest abroad venture by an Indian organization (behind Tata Steel Europe's acquisition of
Corus fourteen days sooner) to this time.
The day after Hindalco declared the securing its stock fell by 13% bringing about a US$600 million
drop in market capitalisation. Investors reprimanded the arrangement yet K.M. Birla answered that he
had offered a fair cost for the organization and expressed, "When you are gaining a world chief you
should pay a premium."
SWOT Analysis:
Strength Weakness
•Global brand image •Present production capacity is
•Cost effective producer not adequate to meet the rising
•Sound financial position high demand
•A high degree quality •Technology is not upgraded to
consciousness is the core mark as compare to global giants
competence of the company in aluminium industry
•Company has a well-established
distribution network, covering a
geographically wide and
scattered market
Opportunity
Threats
•R & D collaboration with
universities and another •Strong domestic and global
research organization competitors, such as TATA,
•More emphasis on downstream POSCO, MITTLE, ESSAR
production of value added •Innovative revolution in
products plastic and steel industry
•Recycling should be adopted as •Fall in prices of Al. in
routine production
neighboring countries
•Raising more finance from
marketing for more acquisition
and merger for consolidating
position in the global market
4P’s of Hindalco:
PRODUCTS: Calcined alumina, alumina metal, special products, rolled products
PRICING: It depends upon on the London Metal exchange and so it changes with respect to LME. It
also varies according to the demand of All India Market. Pricing strategy is generally updated
periodically and it changes according to situation.
PROMOTION: Hindalco use to do promotional activities; which can be seen in the form of CSR like
providing health facilities, promoting education, organising events
PLACE: For Hindalco its stockyard is amongst all around the country which makes its logistics more
efficient.
PESTLE Analysis:
Political Aspect
Strong political will to frame policy for alumminium
US-China trade war can impact aluminum Sector.
sector
Economical Aspect
Recent economic reforms will boost growth potential Less imports and economic slowdown has impacted
years to come operations
Social Aspect
Aluminum is an integral part of modern day mobility and packing
Legal Aspect
Accquisition of Aleris is still pending for regulatory Environmental regulations have been violated in few
purposes. operational sites leading to temporary shutdowns.
Environmental Aspect
Recycling initiatives have been undertaken to Combating climate change with proper measures
make world greener. on pollution.
BCG Matrix of Hindalco:
Market Share
Star Question Mark

•T Ingots •Billets
Market growth
BCGMatrix
Cash Cow Dog

•Aluminum Sows •Rolled Product
•Alumina Hydrate •Special Product
•Calcined Alumina
Porter 5 Forces
Company Organization Structure: -

Mission of the company: -
To relentlessly pursue the creation of superior shareholder value, by exceeding customer

expectation profitably, unleashing employee potential, while being a responsible corporate
citizen, adhering to our values.
Vision of the company: -
To be a premium metals major, global in size and reach, excelling in everything we do, and
creating value for its stakeholders.
Value of the company: -
Integrity
Commitment
Passion
Seamlessness
Speed
Future Strategy: -
 To provide insulation from LME price movements and create stability in the overall
earnings stream
 Increasing aluminisation in industries, such as building and construction,

transportation and packaging, offers significant market opportunity for our large and
integrated operations
 To focus on building and construction segment of the India.

 Increase the production of lightweight alloys and flat rolling allow for EV and
vehicles future demand and capture the market.
 2.5x Targeted Net Debt to EBIDTA ratio
 $1.2 BILLION Targeted consolidated cashflow
 Planning for the future
Last 5-year Market share

Strategic Management Project

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Strategic Management

Prof. Santosh Tiwari

Core Products Market Share

Aluminium & Subs.

Strategies they have chosen so far:

BCG Matrix of Hindalco:

Star Question Mark

Cash Cow Dog

Company Organization Structure: -

To relentlessly pursue the creation of superior shareholder value, by exceeding customer

Vision of the company: -

Value of the company: -

 Increasing aluminisation in industries, such as building and construction,

 To focus on building and construction segment of the India.

 2.5x Targeted Net Debt to EBIDTA ratio

 $1.2 BILLION Targeted consolidated cashflow

 Planning for the future

Last 5-year Market share

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