1. 1. KUSHAN AQUA LTD. Presented by:- Soumya sharma Sugandha Ghosh Priyamvadha Awasthi Prsenjit Basu Rituraj
2. 2. About The KK Group KK Group started its operations in 1972 by Mr. Krishna Kumar in Kolkata. The overall worth of the company is $9 million dollar. Global presence in rubber liners and conveyor components for mines and mineral industries.
3. 3. Companies under KK Group First venture was Megha Ltd; a collaboration with Swedish firm in the business of rubber liners and other products relating to mining. Another venture was Mars which was into supplying conveyor components. Kozley; it was into supplying cyclones for separating solids from liquids, main customer were iron ore mines. HMPL was in supplying wear resistant components and sheets from high molecular weight plastic. Another venture was KAL which was totally out of the line venture it was into Water Management.
4. 4. KK Group Consolidated view (2001) COMPANY LOCATION SALES IN US $ Million 1. Megha Ltd Kolkata 3.5 2. Kushar Aqua Ltd. Noida 4.0 3. Mars Kolkata 0.5 4 .Kozley Kolkata 0.25 5. Hi Molecular Plastic Ltd. Hyderabad 1.0 TOTAL 9.25 The financial health of HMPL and Kozley was not strong,HMPL with worth of US $1 million had losses of $1.2 million and long term debt of 1 million
5. 5. Problem Statement Mr. KK wants to strengthen the groups global presence in the rubber liner and conveyor components and consolidate all the operations in Kolkata. For this he wants to divest KAL ($5 million) which was into water management based in noida and invest that in development of core business.
6. 6. KALs Product Market Scope Set up in 1988 in noida. Collaboration with German firm; Goliathe. KALs business was divided into two groups; *Cooling Tower Division *Environmental Group Under CTDs there biggest competitor was Himalayan Towers with the total market share of 70% in India. KAL enjoyed leadership in EGS with market share of 90% in india.
7. 7. KALs Product 1) TUBEX: Tube Settlers for water treatment- it is a PVC tube for settler of solid liquid separation in water clarification. KAL was the largest producer of PVC tube settlers in asia. Exported to various countries like usa,canada,japan and so on with an expected order worth of around US $0.5 million. Supplier to municipal corporation and NTCP. Average sales for last five years is $0.3 million per year.
8. 8. 2) BIODEX; Tube filters for waste water treatment- It is a media for aerobic and anaerobic application for Biological Oxygen Demand reduction in industrial and domestic waste water treatment plants. This product has contributed in environmental protection and land savings. Average sales $0.8 million per year. 3)PLASDEX: plastic fills for cooling towers- It is PVC fill material used in cooling towers for transfer of heat. Manufactured in three different sizes as per the need of water quality. Average sales $1.25 million per year.
9. 9. Market Study Of KAL products The demand was linked to investments in projects. Acceptance of Counter flow designs. Other source of demand could be retrofitting. Retrofitting and replacement contribution :- 10-20% Annual sales accounted by exports is 10% Market size estimates(In US $ Million) Potential estimated is $15 million. Optimistic $8 $7.5 $15.5 Realistic $6 $5 $11.00 Pessimistic $4 $2 $6.00 Cooling tower EG total
10. 10. Expected Average Sales/year(In US $ Million) Realistic level of projection could be achieved by sustaining aggressive market development activities. Water management has to gain more prominence in India . Marketing function within KAL is recommended. KAL has Future products. Domestic Exports Total Optimistic $7 $2 $9 Realistic $4.5 $1 $5.5 Pessimistic $3 $0.5 $3.5
11. 11. KK group Future Plans & Possibilities Transformation of his group from Local to a Global company. Major emphasis on globalization. Global market--- Mining products:- US $120 million Conveyor belts and other products:- US $250million Branches offices in Ghana, Australia, USA & Indonesia. By the year 2000, Size of company should have been US $50million but it was only US $9million. Reduce the turnover of the Executives. Wanted to devote his time to the operations in Kolkata.
12. 12. REASON FOR KALS DIVESTMENT Mr. Krishna Kumars desire to consolidate and focus towards the globalization It was stressful to manage multi location plants Healthy position of KAL, a major reason behind its dilemma of divestment. Cash Inflow of US $ 5million could be utilized towards strengthening KK groups global business