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PREFACE

Industrial policy covers all the decisions and measures of a Government which

indicate and explain Government attitude regarding respective roles of private, public,

joint and co-operative sectors; large- scale, medium-scale and small-scale industries;

protectionism and market-mechanism; domestic and foreign capital and technological

co-operation; etc; in the field of industrialization of a country. The Government

formulates this policy not in the isolation but within the overall framework of the

requirements of the efforts for economic development, eventually leading to the

achievement of the ultimate objectives of a society.

People are becoming conscious about health and hygienic. There is a change in the

mind set of the Consumer and now looking at “Money for Value” rather than

“Value for Money”. We have seen willingness in consumers to move to evolve

products/ brands, because of changing lifestyles, rising disposable income etc.

Consumers are switching from economy to premium product even we have witnessed

a sharp increase in the sales of packaged water and water purifier.

Indian Government has enacted policies aimed at attaining international

competitiveness through lifting of the quantitative restrictions, reducing excise duties,

and automatic foreign investment and food laws resulting in an environment that

fosters growth. 100 per cent export oriented units can be set up by government

approval and use of foreign brand names is now freely permitted.

The study in general aims at making impact of new industrial policy on performance

of selected FMCG units in India. It covers seven companies viz., Britannia, Mumbai,

Nirma Limited., Ahmedabad, Dabur India Limited, New Delhi, Colgate- Palmolive

(India) Limited, Mumbai, Godrej Consumer Product Limited, Mumbai, Procter &

Gamble Hygine and Health care Limited, Mumbai, Hindustan Lever/ Unilever Ltd,

Mumbai. The period of the study was from 1999-00 to 2007-08. The data for the

study were collected from annual reports of the company, “PROWESS” database of

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Association of companies, Institute of Chartered Financial Analyst, Institute of

Financial Management and Research, Libraries of various Institutions, various

magazines, journals, research publications, dailies and periodicals. Web sites of

organizations, consultants’ reports, companies providing share trading facilities like

Religare, Money control, India bulls etc. were referred for collecting useful

information.

In the present study various accounting techniques such as ratio analysis, vertical

analysis, trend analysis, profitability trend analysis, determinants of profitability have

used. With a view to accomplishing the objectives of the study, various statistical

tools such as mean, co-efficient of variation, range, regression analysis, analysis of

variance and F- test etc. have used. Uses of graphs and charts have also used to

accomplish the study in a more accurate manner.

The study has been systematized into seven chapters. Each of the chapter has been

dedicated to some aspect of the study entitled “Impact of the New Industrial Policy

on Corporate Performance: A study of selected FMCG Companies in India”.

Chapter I discusses with the FMCG Industry of India- A Bird’s Eye View, meaning,

characteristics, evolution, Indian FMCG sector, Impact of the policy on FMCG, trend

and players. Chapter II focuses on Industrial Policy of Government of India focusing

on Evolution of the Industrial Policy, Recent Changes in the Policy, Impact of the

new Industrial Policy, and Appraisal of the New Industrial Policy. Chapter III

narrates with the survey of existing literature and research methodology, significance

of the study, objectives of the study, hypothesis of the study, research methodology,

limitations of the study, and chapter scheme. Chapter IV relates with Analysis of

Performance of Selected FMCG Companies. Chapter V deals with Analysis and

Comparison of Profitability, analysis of variance (ANOVA). Chapter VI relates to

the Trend Analysis of selected FMCG companies. Chapter VII summarizes the

findings of the FMCG companies in India and suggestions for triumphant endurance

of FMCG companies in India.

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The study has academic significance and relevance and will act as a magnum opus on

the subject for further research and development as far as India is concerned. The

study is expected to help various stakeholders i.e. management, moneylenders &

creditors, owners, investors, employees, trade union, government etc. in decision

making process at their own. It would facilitate various stakeholders to spot the

determinants of performance of the company and industry, it would also endow with

penetrating understanding to financial institutions, money lenders, banks to

understand financial position and debt repaying capabilities of the companies. It

would also divulge new panorama to the industry association and the government in

understanding characteristics of the companies for inter and intra firm comparison. It

would also give different perspective of the analysis to the academic researchers,

financial analysts, securities researchers, company and industry.

Kapilkumar Kanubhai Dave