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2 Products 4
7 SWOT Analysis 9
9 SWOT Matrix 11
12 BCG Matrix 18
HISTORY:
When we talk about the story of textiles in the sub continent, it’s about Gul Ahmed. The group
started its trading in 1900’s. With all its creation and innovative work and experience, the group
decided to enter in to the field of manufacturing and Gul Ahmed Textile Mills LTD, which was in
the year 1953, was incorporated as private limited company. In 1972 it was listed on the Karachi
stock exchange. And since the company is doing rapid progress and become one of the best
composite textile houses in the world. The mill is presenting a composite unit with a capacity of
130,296 spindles, 223 wide width air jet looms and also a state of art processing unit and finishing
unit.
INTRODUCTION:
Gul Ahmed first started its trading in textiles in the early 1900's, and manufacturing was done in
1953 with the establishment of Gul Ahmed Textile Mills Limited. Gul Ahmed was listed on the
Karachi Stock Exchange in 1972. Fifty years since its beginning, the name Gul Ahmed is still
identical with quality, innovation and reliability. As it is also vertically integrated so Gul Ahmed is
also capable of producing different varieties, starting from cotton yarn to finished product involving
different processing techniques. The capacity of Gul Ahmed spindles is 120,000, and the spinning
units are able to produce a wide variety of yarns from 100% cotton yarn to poly-cotton, cotton-
viscose and other blends in both coarse and fine counts. The weaving units are completed with high
speed 250 air jet looms and can produce high quality fabrics in sheets, satins, percales, twills, drills,
voiles and an set of other finely woven fabrics including yarn dyed. Processing is assembled with
sharp and experienced technology to ensure quality printing, dyeing, and different finishing
treatments with facilities to add some extra value to products. The Gul Ahmed state of the art
stitching facilities is completed with regular and approved machines which manufacture products in
many varieties and styles. The large embroidery and quilting units add adaptability for enhancement
of products to supply to all sorts of customer needs and requirements. This help to encourage
systems that constantly checking and controlling production to achieve high standards.
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PRODUCTS:
Gul Ahmed’s fine textile products represent a unique fusion of the century old traditions of the east
and the latest textile technology of the west. The apparel line consists of fabrics such as lawns, linen,
chiffon, latha, khaddar and polyester cotton for the ladies collection. Gents collections are chairman,
texana, poplin etc. The home textile range of bed linen, cushions, kitchen items and curtains are in
plain dyed, printed up to 21 colours embroided and embellished in different styles through a
combination of latest technology, skills and craftsman ship of this traditional industry.
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VISION AND MISSION STATEMENT
VISION STATEMENT
“Setting trends globally in the textile industry. Responsibly delivering products and services to
our partners.”
GUL AHMED VISION ANALYSIS:
The vision statement clearl y describes the dream or the future of the company that is
to be the world’s most well known textile industry and also to be the most appreciated
and positively graded brand by all levels of people around the world. T h e c o m p a n y a l s o
f o c u s e s i t s v i s i o n t o e m p l o y e e s a t i s f a c t i o n s , s o t h a t t h e employees will be
happy by responsibly delivering their products and services.
MISSION STATEMENT
“To deliver value to our partners through innovative technology and teamwork. Fulfilling our
social and environmental responsibilities.”
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ANALYSIS OF MISSION STATEMENT
NO COMPONENT YES/NO
1 Customers Yes
2 Products/ services No
3 Markets Yes
5 Technology Yes
6 Philosophy Yes
7 Self concept No
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1) Product/services
2) Concern for survival , growth and profitability
3) Self concept
“To deliver value to our partners by fulfilling their fabric and textile necessitate through
innovative technology and teamwork. And recognize profitability and growth mutually by
fulfilling our social and environmental responsibilities.”
EXTERNAL FACTOR EVALUATION MATRIX: (EFE MATRIX)
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WEIGHT RATING WEIGHTED
OPPORTUNITIES AVERAGE
THREATS
TOTAL 1 3.06
WEAKNESSES
TOTAL 1 2.91
SWOT ANALYSIS
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STRENGTHS WEAKNESSES
OPPORTUNITIES THREATS
SWOT MATRIX
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STRENGTHS (S) WEAKNESSES (W)
1. Strong brand name 1. Sethiya culture
2. Deliver value through innovative
2. Targeting elite class
technology
3. Enjoying leading position in the 3. High prices
world of textiles
SWOT MATRIX 4. Unique designs and creativity 4. Marketing vigorously
5. Have their own power 5. Lack of freedom and decision
generation plant power
6. Efficient production capacity
7. Adopting best practices to
ensure greener society
8. Export their products globally
OPPORTUNITIES (O) SO- STRATEGIES WO- STRATEGIES
1. To invest into
cosmetics market Should expand local markets Should marketing
2. Open their production
plant to Bangladesh by offering unique designs vigorously to invest into
and creativity. (S4,06) cosmetics and expand
3. Facilitation for Should use more innovative local market. (S4,01,06)
overseas candidates for technology by increasing Employees should be
internships their research and given training on health
4. Increase research and development. (S2,04) awareness and should be
development Should give training on given freedom & decision
health awareness with the power. (S5,05)
5. Involved in health collaboration of CSR.
awareness programs
and trainings. (S7,05)
FINANCIAL RATIOS
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We have calculated the following ratios by taking data from 2012 annual report of GUL AHMED
which is listed on Karachi Stock Exchange.
1) PROFITABILITY RATIOS:
In 2010 the company sale is increasing by 41.58% and same it is increase in 2011.but in 2012 it is
decreased by 1.1%.
The Company net profit to sale is 2.43% but it increased to 4.70%.in 2012 it shows a
negative sign which shows that company earning is declining.
The company gross margin to sale is increased in 2011, but it decreased in 2012, which indicates
that company earning is declining.
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This is the ratio showing the return obtained by investment of owner’s equity. It is
calculated by: Net profit/ total equity
The company did well in 2011, but in 2012 it decline by 5.23% which shows that company earning is
declining.
The return on capital measures how the company is using its money to generate returns.
The company return on capital in 2010 was 27.87% which increase to 39.82% but it decline in 2012 by
19.52%.
The earnings per share show good measure of profitability. it shows how much profit is earn on
shares.
2) LIQUIDITY RATIOS:
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(i) CURRENT RATIO:
Current ratio has improved in decline in 2012 as compared to 2011.the benchmark should be
2:1.The company current ratio in 2012 is below the benchmark.
An interest coverage ratio below 1 indicates the company is not generating sufficient revenues to satisfy
interest expenses. But the company interest coverage is above 1 in consecutive 3 years.
It shows the quick or slow inventory item, it is the holding period of inventory at warehouse before
sale. It is calculated by:
Times = sales/inventory
Days= 365/turnover (times)
2012 2011 2010
151days 134days 98 days
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2012 2011 2010
3.67 3.82 3.21
The company fixed assets turnover ratio was increased in 2012 which is 3.67 as compare to other
two previous years.
3) DEBT RATIOS:
(i) DEBT RATIO:
It shows the total claims of creditors against assets; it should be as low as possible as debt
increases leverage. It is calculated by:
Total liabilities/ total assets
2012 2011 2010
34.86% 34.64% 40.33%
Debt ratio in 2010 was 40.33%, but it decline in 2011 and 2012 this is a good sign which
indicates that the company is working to reduce their debt ratio.
The financial leverage ratio is also referred to as the debt to equity ratio. The financial leverage
ratio indicates the extent to which the business relies on debt financing. it is calculated through
Financial Leverage Ratio = total debt / shareholders equity.
SPACE MATRIX
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Financial Strength Environmental Stability
distributors
AVERAGE -1.4 AVERAGE 5.2
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X-axis = competitive advantage + industrial strength
= (-1.4) + (5.2)
= 3.8
= (6) + (-2.6)
= 3.4
GRAPHICAL REPRESENTATION:
RESULTS
According to the SPACE matrix, the Gul Ahmed Company will adopt aggressive strategy in order to
capture more and more market share in order to become market leader not only in Pakistan but also
across the world.
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BCG MATRIX
Market
growth
CASH COWS DOGS
Low
Strong Weak
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EVALUATION OF BUSINESS MODEL
A solid business model remains the bedrock of every successful investment. Quite simply, the
business model is how the company makes money. Gul Ahmed is in a growth market, and it has a
good relative overall position in a textile industry. It offers an unbeatable environment and friendly
and helpful staff to assist customers in any question or problem they might have with the quality and
creativity of the product. People buy Gul Ahmed product for what it represents and the status symbol
that comes along with it. Although various business models exist, the principles and structure of Gul
Ahmed is a good model to follow. Expanding abroad and realizing a greater market area is one of the
first strategic imperatives of a company. Understanding a company’s business model is crucial to
investing in individual securities if the purpose is to invest with the objective of outperforming a
benchmark return or for a high absolute return. A key point is that the numbers are a result of the
business operations; the business operations are not the result of the numbers.
delivery outlets
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BLUE OCEAN STRATEGY
CONCLUSION
STRATEGY 1:
Instead of targeting elite class and high prices, it should offer special discount offers during the period of
economic downturn so as to retain the customers during recession.
STRATEGY 2:
It should export their products globally by observing the changing preferences of their customers.
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