Last time we did an in-depth case study on the largest Ayurvedic and natural health care company in the world, Dabur. Today we are going to do an elaborative SWOT analysis of EPL – Essel Propack Limited.
EPL is the world’s largest speciality packaging manufacturer of laminated plastic tubes for FMCG and Pharma space who have offices across the world. They partner with the world’s topmost FMCG companies. They always try to impress their customers with their innovative and attractive packaging for their products.
One of the reasons why most FMCG companies work with them is due to the cost-effectiveness of the company. They provide their services at a very affordable and relatively cheaper price than their competitors.
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Before we begin with the SWOT analysis of EPL, here’s a deep dive into the company’s history, founding, products, financial status, competitors.
(Sudhanshu Vats (MD&CEO) Of Essel Propack Limited, Source: hrnxt)
It is owned by Blackstone Group who has its headquarters in Mumbai (India). In 1982 the company was established from the mergers of pre-existing companies i.e Essel Packaging & Propack AG led which then formed as Essel Propack Limited.
In 1984 they started manufacturing in India. In 1993 by setting up an overseas plant in Egypt they made themselves available globally. In 1997 they opened a wholly-owned subsidiary in China. In 1999 they set up a joint venture in Germany and in 2000 the EPL acquired a worldwide tube business.
They entered the US in 2002 where they set up a greenfield facility for laminated with P&G group in Danville and 2004 acquired UK’s market. In 2009 the company’s global market share was 33% in the toothpaste tube packaging industry.
The Company in 2019 was acquired by The Blackstone Group during an asset sale of the debt-ridden Essel Group as was thus renamed in Oct 2020 as EPL Limited.
|Key People||Sudhanshu Vats (MD & CEO)|
|No. of Employees||2,700+|
|Company Type||Publicly Traded Company|
|Market Cap||Rs 7,918 Crore (2021)|
|Annual Revenue||Rs 2,773 Crore (2019)|
|Net Income/ Profit||Rs 40.03 Crore (2020)|
Products of EPL
(Essel Propack Range of Segments, Source: WOOB)
- Oral Care
- Beauty and Cosmetics
- Pharma and Health
- Food And Nutrition
- Home care
- Laminated Tubes
- Extruded Tubes
- Caps and Closures
- Dispensing System
Competitors of EPL
- Ester Industries Limited
- Alpha Packaging
- Pan Synthetics
After understanding the core of the company, let us now proceed to the SWOT analysis of EPL.
SWOT Analysis of EPL
As the company is leading in specialised packaging. They are always with a clear vision that they are leading in the Packs and should continue to be there, with an aim that the change that they want to see around should always be started & adopted by the first, letting the competitors follow them. If the companies vision is so strong what will be its SWOT? let’s have a look at it.
To better understand the SWOT analysis of EPL, refer to the infographic below:
So let us first start by looking at the strengths of EPL from the SWOT analysis of EPL.
Strengths of EPL
- Global Presence: EPL has its global presence and due to services provided by them, the company has major customers. The company always focuses on expansion i.e forming joint ventures, giving franchises, and many mergers and acquisitions have helped them to make their presence globally.
- Relationships with Large MNC’s: EPL has the customers like Unilever, Colgate Palmolive, Procter & Gamble and much more mega MNC which is a great strength of the company.
- Market Leadership: EPL is leading in the packaging sector and always has a vision to be at No.1, 2019 it captured more than 33% of market share globally and it’s now focusing to raise its share.
- Good At Technology: EPL is good at adopting the changes and as per need they shifted to online mode too. They have good hands-on technology and are operating in the market as per the changing trends and demand.
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- Cost-Efficient: One of the reasons EPL has mega MNCs as their customers are due to EPL’s cost-effective feature. EPL provides its products at a comparatively cheaper rate than its competitors
- The economy of Scale: The company always follow the economies of scale and price skimming by which they try to cover all the potential customers.
Weaknesses of EPL
As the coin has the two sides similarly the EPL have weaknesses too, because of which companies position is affected. It needs to work hard to maintain its position in the market.
- Price Escalation: EPL provides the products at a very cheaper rate to capture the larger share in the market they try to provide it at a very low rate so has to face losses.
- Single Business Model: EPL has a very wide range of products in its product portfolio and it just has a single business model that is why the company cannot wholly focus its attention on all things.
- High Debt Equity Ratio: EPL always tries to capture the customers so they always provide it at a cheaper rate this has led the company to face a very high debt-equity ratio.
- Poor Control: EPL does not have good control over its franchisees that’s why when the company tells them to arrange events, many of them don’t follow the culture to save their spending and many more things are ignored by their franchisees.
Opportunities for EPL
- Development Centers: EPL has a very wide range of products in its portfolio and the growing development centres will help the company to excel.
- High Market Demand: EPL is leading in packs and has captured market share to a great extend so the demand for the products offered is relatively very high than its competitors this will always help the firm to yield profits.
- Diversification: EPL is very good in its R&D and always try to adopt the new product and work on diversification of the product that’s why a wide choice is available to customers and so many of them are attracted towards the firm.
- Technology: EPL is always ready to upgrade itself with the coming new trends that’s why it does not lack behind and also has good hands-on technology which helps them to retain the customers and try to attract the new ones.
Threats to EPL
- Raw Material Prices: EPL always tries to offer the products at a cheaper rate and so when the prices of the raw material are raised they face many problems to raise the prices of finished products with the view to retain the customers. This is the biggest threat to EPL as if this continues the firm will have to face very high financial risk.
- Economic Uncertainty: EPL has captured the market globally so the countries current status be it inflation or deflation directly affects the economic condition of the firm so there is always uncertainty.
- Key Competitors: The company though has captured the market to a good extend still have threats from its competitors.
- Economic Downturn: The company sometimes is not able to provide the products on time to its customers that’s why it may lose its potential customers letting the company turn down.
- Promotores are Decreasing Their Shareholding: Due to economic downturn or many internal reasons the promoters are reducing their stacks, that’s why the customers feel unrest or are worried to trust the firm.
This ends our elaborative SWOT analysis of EPL. Let us conclude our learning below.
As we learned that the company was having a single business model, and due to this was ignoring many of the important things. Just think once, if you too are just relying on only one thing or maybe unaware about the new upcoming trends you too may face problems.
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We hope this blog on the SWOT analysis of EPL has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.
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