In January 2020, the chief executive officer of the family-run business Scak Textiles LLP (Scak), based in India, was thinking about how the company could achieve a new milestone of ₹500 million in revenue by 2025. He wondered why the company, after coming so far, could not achieve that number with a sustainable margin. What else could he do to help Scak reached this target, and how could he solve the bottleneck of resource constraints?<br><br>The bright next-generation entrepreneurs of the family were taking an active interest in the business and had strategic plans for enhancing the effectiveness of both business and revenue models while navigating the ever-changing business ecosystem. The promoters of Scak wanted an outline of the entrepreneurs' recommendations with adequate assumptions and a business valuation. The promoters would expect a 15 per cent return on additional capital invested; the corporate tax rate would be 30 per cent. The next-generation family members saw three possible options: add manufacturing operations, establish e-commerce platforms for business-to-business and business-to-consumer businesses, or enter the business of exporting. Could they take up all three options, or should they maintain the status quo? The value and future of Scak would depend on their decision.
In January 2020, the chief executive officer of the family-run business Scak Textiles LLP (Scak), based in India, was thinking about how the company could achieve a new milestone of ₹500 million in revenue by 2025. He wondered why the company, after coming so far, could not achieve that number with a sustainable margin. What else could he do to help Scak reached this target, and how could he solve the bottleneck of resource constraints?<br><br>The bright next-generation entrepreneurs of the family were taking an active interest in the business and had strategic plans for enhancing the effectiveness of both business and revenue models while navigating the ever-changing business ecosystem. The promoters of Scak wanted an outline of the entrepreneurs’ recommendations with adequate assumptions and a business valuation. The promoters would expect a 15 per cent return on additional capital invested; the corporate tax rate would be 30 per cent. The next-generation family members saw three possible options: add manufacturing operations, establish e-commerce platforms for business-to-business and business-to-consumer businesses, or enter the business of exporting. Could they take up all three options, or should they maintain the status quo? The value and future of Scak would depend on their decision.
Essar Group (Essar), a large diversified conglomerate based in India, needs to raise significant capital through an initial public offering (IPO) and has to decide whether to do so through the Indian Stock Exchange, the London Stock Exchange or the New York Stock Exchange. The company will have to continue to report in Indian GAAP and, if it decides to list its IPO in the United States or Europe, it also will have to adopt either U.S. GAAP or IFRS. The chief financial officer of Essar has to recommend to management where to raise the needed capital and what accounting standard to adopt. The B case 9B13B015 discloses the decision and describes some of the implementation issues.
Essar Group (Essar), a large diversified conglomerate based in India, needs to raise significant capital through an initial public offering (IPO) and has to decide whether to do so through the Indian Stock Exchange, the London Stock Exchange or the New York Stock Exchange. The company will have to continue to report in Indian GAAP and, if it decides to list its IPO in the United States or Europe, it also will have to adopt either U.S. GAAP or IFRS. The chief financial officer of Essar has to recommend to management where to raise the needed capital and what accounting standard to adopt. The B case 9B13B015 discloses the decision and describes some of the implementation issues.