Bcg matrix of icici bank frfee
HDFC insurance products have high market share and high growth rate.
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Moreover, they also promote through billboards, digital ads, and TV ads. This is based on strong empirical evidence showing that cash flow is related to these two factors. The pricing of their services depends on the economic factors or currency fluctuations in the country. In the long run all dogs are potential candidates for elimination from the product range. This means that these products or SBUs tend to be heavy users of cash arising from high promotional expenditures in growth markets. Example of a completed BCG matrix The BCG approach offers a simple method of analysing and evaluating current businesses, and is a relatively straightforward way of arriving at future strategies for them. However, will the company actually grow? They usually stress on promoting modernized, improved, and convenient banking that is provided to the customers that also benefits them in many ways. The techniques we now examine are some of the better known examples of these, i. This helps the company allocate resources and is used as an analytical tool in brand marketing, product management, strategic management, and portfolio analysis. We can also calculate the value of the turnover of each SBU or product and denote this by using circles, where the area of the circle is proportionate to its turnover. This is so if they are to increase their market share, as they must do if they are to survive in the long run. It is, however, often difficult in practice to separate these. The four steps are: For each strategic business unit SBU or product determine annual growth rate in the market. A balanced portfolio is thus intended to ensure sufficient positive net cash flow to guarantee longrun success for the company as a whole.
This means we should only focus on profitable products and try to investment on those products which are low market growth rate but perform well if proper investment is theirs.
This is based on strong empirical evidence showing that cash flow is related to these two factors. The sluggish rate of growth in the economy suggests that growth could indeed pose a problem. However, will the company actually grow?
Normally this is calculated on the basis of market share compared to that of the largest competitor. This means that these products or SBUs tend to be heavy users of cash arising from high promotional expenditures in growth markets.
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This shows that HDFC high market share and low market growth rate in mutual funds. Their promotion involves direct and indirect communication with the customers. In fact, in the first quarter of the financial year-ended , HDFC Bank was able to record only a 43 per cent growth in profits. Cash flow as the performance criterion: Some doubt the use of cash flow as being the most appropriate objective in a company, arguing instead that return on investment is more appropriate. This, however, may not be good enough to justify the valuation commanded by the stock. The balance between problem children, stars and cash cows should be such as to ensure that the company has sufficient net positive cash flow from its cash cows to fund its stars and turn them eventually into cash cows. Criticisms and limitations of the BCG approach Among the major criticisms and limitations of this portfolio technique we include: Over-simplification: The matrix uses only the factors of market growth and relative market share to assign products or SBUs to its various cells. This notion is captured in the following quote from Lancaster and Massingham: A balanced portfolio would ideally contain few or no dogs, some problem children, some stars and some cash cows. This means that these products or SBUs tend to be heavy users of cash arising from high promotional expenditures in growth markets.
They usually stress on promoting modernized, improved, and convenient banking that is provided to the customers that also benefits them in many ways. It should be noted that sometimes dogs may be retained for other strategic reasons such as maintaining a full product portfolio.
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