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Elaborated SWOT Analysis of Vardhman Textiles – The Largest Textile Group In India

by | Case Studies | 0 comments

When you visited us last time, we are sure you must have checked out our previous blog about the SWOT Analysis of Tata Steel, one of the most trusted brands in India. Today, we will be taking a brief look at the SWOT Analysis of Vardhman Textiles – One of India’s well-recognized steel manufacturers.

Vardhman Textiles is one of the leading textile industries in India, which was founded in 1965. The company’s 22 manufacturing facilities are spread across 6 states in India.

Vardhman Textiles covered a very vast market through traditional strategies only but if a business wants to survive in today’s world, then they have to follow digital strategies which help a business to reach its peak. To learn more about digital marketing and add a new feather to your skill hat, we suggest you attend a Free MasterClass on Digital Marketing 101 by the CEO and Founder of IIDE, Karan Shah.

Vardhman Textiles’s efforts in marketing have helped them a lot. Marketing helps in achieving the desires and preferences of the target audience. Today every other company is using digital marketing, hence it has become a very important and essential skill to learn.

Before we start with the SWOT analysis of Vardhman Textiles, let us learn more about the company.

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About Vardhman Textiles

SWOT Analysis of Vardhman Textiles

Vardhman Group of companies is a major group producing textile-based products. Vardhman Textiles is an Indian textile industry manufacturing Yarn, fabric, sewing threads, fibre, garments and special steels, located in Ludhiana, Punjab. It is previously known as Vardhman Spinning and General Mills Ltd and the founders Shri V.S Oswal & Shri Ratan Chand Oswal started production in 1965 to produce Cotton Yarn with 6000 spindles.

Vardhman Textiles was incorporated in 1973. It was incorporated into the flagship of a group. They diversified their business by installing 25000 spindles at Hoshiarpur, Punjab by the name of Arihant Spinning Mills. Then they expanded their business by indulging in sewing threads. In 1988, the company was merged with Mohta Industries Limited and set up a mini steel plant at Ludhiana.

The company started exporting its products in 1990-91 mainly in Spain, the UK, the US, Germany, Japan, and in some parts of Africa and Asia. To diversify their business, they set up various industries in Himachal Pradesh and Madhya Pradesh as well. Vardhman Textiles was incorporated as a joint venture and became the world’s second-largest thread industry. Its mission is to become a world-class textile-producing industry and to bind its customers with them.

 

Quick Stats on Vardhman Textiles
Founder Shri V.S. Oswal & Shri Ratan Chand Oswal
Year Founded 1965
Origin Ludhiana, Punjab, India
No. of Employees 28,000+
Company Type Public
Market Cap Rs 12,919.31 Crore (2022)
Annual Revenue Rs 5,977.11 Crore (2021)
Net Income/ Profit Rs 428.59 Crore (2021)

 

SWOT Analysis of Vardhman Textiles


Products By Vardhman Textiles
 

Vardhman Textiles had been in business for over four decades and primarily deals in:

  • Cotton yarn 
  • Synthetic yarn
  • Sewing thread
  • Acrylic fibre
  • Garments


Competitors of Vardhman Textiles

Vardhman Textiles compete on a global level with several other manufacturers, of which its top competitors include: 

  • Freudenberg Performance Materials
  • Coats
  • Style Textile
  • Damodar Threads


Now that we understand the company’s core business, let’s delve into the SWOT Analysis of Vardhman Textiles. 


SWOT Analysis of Vardhman Textiles

A SWOT analysis evaluates the strengths, weaknesses, opportunities, and threats that a firm faces. Vardhman Textiles may evaluate its business and performance against rivals and the industry as a whole using this tried-and-true management model.

It’s a great tool for figuring out where the firm shines, where it falters, devising countermeasures, and figuring out how to expand.

To better understand the SWOT analysis of Vardhman Textiles, refer to the infographic below:

SWOT Analysis of Vardhman Textiles - SWOT Infographics of Vardhman Textiles

So let us start by expanding on the strengths of Vardhman Textiles from the SWOT Analysis of Vardhman Textiles:

Strengths of Vardhman Textiles

The distinctive qualities that provide a company with an edge in acquiring greater market share, attracting a larger audience, and maximising profitability are essentially its strengths. The following are Vardhman Textiles’ strengths: 

  • Diversified Business: Vardham has diversified business in yarn, fabric, sewing threads, fibre, garments and special steels. The company has a force of 28000 plus employees spread across 22 manufacturing facilities in 6 states.
  • Integrated Operations in India: Though it is a technical element, the entire process of extraction from fibres and fabrics to produce finished garments is integrated in India. The combined processes save a lot of time and money while maintaining the desired quality.
  • Market Position: Vardhman Textiles is one of India’s most vertically integrated textile groups and the world’s most geographically diverse steel producer. It has a significant presence in Spain, the UK, the US, Germany, Japan, and some parts of Africa and Asia.
  • Global Footprint: Vardhman Textiles has a global footprint of over 50 nations, with activities in over 26 countries, increasing its penetration and share.
  • The Great Old Experience: Vardhman Textiles, a pioneer organisation in the yarn & fabric manufacturing industry has over three decades of experience in owning, operating, maintaining & controlling steel mining and production.
  • Government Support: Vardhman Textiles follows good corporate governance and gets immense support from the government of India which is why the limited company is still generating revenues in increasing directions. 
  • CSR Activities: Vardhman Textiles serves society through education, environment and safety. It also runs the Vardhman school development program that makes contributions in the field of education which is an integral part of its CSR.


Weaknesses of
Vardhman Textiles

Weaknesses are the areas where the company is lacking behind and needs improvement. Let’s have a look at the weaknesses of Vardhman Textiles:

  • High Cost in Replacement of Established Expertise: Vardhman Textiles Ltd’s knowledge base is entrusted to a small number of people, and replacing them will be difficult under the current circumstances.
  • Shortage of Technical & Financial Resources: The business has experienced a shortage of technical and financial resources, which has reduced its ability to grow its service locally and globally.
  • Strong Government Regulations and Policies: There are strong government rules and regulations that make operational efficiency low and create a hindrance in the working of a company.
  • Operational Complexity: With an increasing audience, the group is providing a large number of consumer goods as much as they can. While making adjustments, a small change can make an unexpected impact on operational complexity. Providing a variety of products is causing operational complexity for the group. 
  • The Processing Chain is Quite Long: Having a huge customer following delays the process of ongoing functions like maintaining a large scale of client records & keeping them up to date every time takes time and while doing all the work simultaneously it delays the ongoing processes. 
  • Confusing Portfolio: Vardhman Textiles has expanded its products and services portfolio in an enormous sector and it is difficult to define in which particular sector Vardhman Textiles excel. Vardhman Textiles should now focus on excelling in one sector to generate more revenue streams and create an identity that shows the USP of Vardhman Textiles.


Opportunities for Vardhman Textiles

Potential areas of attention for a corporation to enhance results, expand sales, and, ultimately, profit help determine the opportunities of a company.

  • Accelerated Technological Innovations & Advances: Rapid technical advancements are increasing industry productivity, allowing suppliers to provide a wider range of products and services. This may enable Vardhman Textiles to expand its product portfolio dramatically.
  • Local Collaboration: Partnerships with local firms can help Vardhman Textiles expand its market share in foreign markets. Local firms have a local experience, but Vardhman Textiles can contribute global procedures and execution skills.
  • Buyer’s Attraction to Asian Markets: Most people believe that the Asian Market is the leading and best producer of textile industries. So Vardhman Textiles has to adopt various new techniques which attract international investors to the Asian market.
  • Govt. Programs: Indian Govt. establish various programs to help textile industries to grow. So, Vardhman Textiles have to take the opportunity of these programs to grow their business as well.
  • Establish Digital Market: In today’s world, people only believe those who have digital existence. So Vardhman Textiles have to establish their digital existence which creates a powerful name for their brand which is easily recognized by everyone.
  • Overseas Excess: In today’s world if a business wants to grow properly then they have to expand its market throughout the world and have to establish its roots everywhere to grow its sales.


Threats to Vardhman Textiles

Threats are environmental factors that could potentially be detrimental to a company’s growth. Following are some of the factors that pose a threat to Vardhman Textiles: 

  • Intense Competition: Vardhman Textiles’ primary competitors continue to include Freudenberg Performance Materials, Coats, Style Textile, and Damodar Threads among others. According to prior experience, this diminishes its global market share.
  • Government & Environmental Regulations: The government has slightly different and more strict laws for the textile industry because it is our natural core and to maintain their control over the consumption of natural resources. While on the other hand organisations concerned about the environment also have their eyes on the textile industry due to its threat to natural resources and the environment.
  • Changes in the Prices of Raw Materials & End Products: Clothing & garments necessitates the use of fibre, fabric, yarn and cotton. All of these resources are limited, and obtaining them is tough. Because it is often difficult to plant in particular places, the prices of raw resources continue to rise, and even the prices of final products fluctuate; this is a threat for Vardhman Textiles.
  • Shortage of Trained Human Resources: Due to significant staff turnover and a growing reliance on new solutions, the firm name may encounter skilled human resource issues in the future.
  •  


This ends our extensive SWOT analysis of Vardhman Textiles. Let us conclude our learning below.

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To Conclude

One of the biggest takeaways of this article can be how Vardhman Textiles has always been an inspiration to many businesses for being innovative and technologically forward. The company, being one of the leading textile groups in India has always put a good hand forward to help the country flourish by conducting CSR activities and at the same providing quality products.

The company has ever since gained huge recognition for being one of the companies to embrace digital marketing to make its products well known. With the current trend of customers buying everything online, businesses need to follow the same and retain their customers. 

Digital Marketing is one such tool that can help businesses to approach a huge audience in the digital world. Thus, to be skilled at knowing the basics of digital marketing in today’s business scenario is a must. To learn more about digital marketing, you can head to our page and check out IIDE’S 3 Month Advanced Digital Marketing Course to know more. You can also start your journey in digital marketing by taking our short term certificate courses in digital marketing and learning different topics related to the field of digital marketing.

We hope this blog on the SWOT analysis of Vardhman Textiles has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.

If you enjoy in-depth company research just like the SWOT analysis of Vardhman Textiles, check out our IIDE Knowledge portal for more fascinating case studies.

Thank you for taking the time to read this, and do share your thoughts on this case study of the SWOT analysis of Vardhman Textiles in the comments section below.

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