Case studies

Neons Fashion LLP was an entrepreneurial venture of Arthi Ramalingam after completion of her MBA. Arthi had an interest in jewellery since childhood and she decided to focus on design, manufacturing and retailing of fashion and costume jewellery items under the brand name of Eternz through different sales channels like exhibitions, retail stores, own website and as an independent seller on e-commerce marketplaces. She initially started selling on Amazon marketplace through a third party, Cloudtail India Pvt. Ltd., and later sold through other e-commerce marketplace operators like Flipkart, Jabong and FirstCry. As her business grew, Arthi planned to add the kids' shoes category and also decided to participate in Bangalore Fashion Week to build the Eternz brand. However, in November 2016, Cloudtail terminated her contract which played havoc with the sales and profitability of her start-up. Neons Fashion LLP (A) provides details of how independent sellers are at the mercy of marketplace operators and ends with the need to review the choices of sales channels for different categories like fashion garments and fashion accessories, and for the upcoming launch of kids' shoes. Neons Fashion LLP (B) describes the events after the Bangalore Fashion Week that ultimately led to closure of business.

Suning Group launched Suning.com when its chain stores were developing at the highest speed, realizing the transformation to an Internet retailer. Suning continued to follow the growth strategy of “Technological transformation and Smart Services”, and was renamed Suning Commerce Co. Ltd. It launched a business model of “e-commerce + stores + retail service providers”. Riding on the brand new O2O business model, Suning is thinking and practicing from simple donation to actual implementation, from constructing public welfare network to extending CSR ecosystem in a bid to advance towards deeper and more extensive Internet economy, and to create greater social value.

Mr. Sajjan Jindal, MD of JVSL (nos JSW) wanted to bring the latest technology of iron making into India. His project went to several cost overrun and time overrun due to several foreseen and unforessen circumstances. This case discusses the issues new technology introduction in iron making area, problem faced by inexperienced contractor. It shows the need for proper risk management is required. It also shows the criticality of the project does not mean time cost trade off, but many other factors like reliability of the equipment, process and reliability of the equipment and plants.

The case aims to understand and analyse the capital structure decisions made by a profit-making, growing organisation which aimed to be India’s premier airline and the market leader. The company that had pursued a high debt policy, to take advantage of the financial leverage that it would get, was now facing problems in an operating environment that proved to be challenging. A decline in operating profit, coupled with high-interest costs and an uncertain environment with cutthroat competition, had caused the company to plunge into losses. Attempts to deleverage by equity infusion were proving to be difficult. The case can be used in MBA, Executive Education and doctoral programmes. The learning objectives of this case are: to analyse the capital structure of the company, to interpret the relationship between financial leverage and risk, to assess the pecking order theory, to analyse the nuances of the aviation sector and the factors influencing the profitability of the companies in the aviation industry, to estimate the risks and the rewards associated with foreign currency loans, to evaluate the magnifying impact of the financial leverage and to propose deleveraging methods like sale and leaseback, debt conversion to equity and devise a revival strategy for the company.

The case discusses the dilemma faced by Naresh Goyal, promoter and chairman of Jet Airways (India) Limited. At the initial stage, Jet Airways, like many other companies in its growth phase, relied on borrowed funds to meet its investment needs. However, over-reliance on borrowed funds with just one equity infusion resulted in a high leverage ratio and an aggressive capital structure. Moreover, the company operated in a sector that was highly regulated, with competition that was cutthroat and a cost structure that was volatile. A high operating risk, coupled with high financial leverage, pushed the company into incurring losses. Having run out of cash, Jet Airways eventually defaulted on loan repayments to its lenders. Facing the eventuality of losing control of the company to lenders or to a strategic investor, Goyal was trying to figure out a way to save the company from insolvency and liquidation. It was becoming increasingly difficult for Goyal to keep Jet Airways, the company he had nurtured like a baby, airborne.

The case can be taught in both online and offline modes of delivery in a 90-minute session. Post-covid, the delivery mode of classes has changed. In online sessions, it may be a challenging task to ensure student participation.

Teaching notes are available for educators only.

CSS 1: Accounting and Finance.

Dialogue in Darkness (DID) is a global social enterprise, which provides products and services such as workshops, exhibitions and activities in the dark in China. The corporate workshops are designed for companies, institutions and government agencies to provide unique leadership training and some other training in teamwork, communication, innovation and change management. And education workshops are aimed at providing young people with unique leadership training and training in teamwork, innovation and empathy and so on for the educational institutions. Over the past five years, DID, headquartered in Shanghai, has expanded to Beijing, Chengdu and Shenzhen, realizing strategic coverage of East, West, North and South of China. DID achieved break-even within less than one year since its inception. Its sound and healthy development offers an innovative way for the sustainable development of social enterprises.

In 2015, NESTLÉ India underwent a major crisis as the product which contributed to nearly 30% of its sales had to be taken off the shelves. Maggi—the go-to convenience food for all generations (especially kids and young adults)—which had entered the market in 1983, was banned. With a market share of 70-80% before the ban, NESTLÉ, which got the ban lifted in November 2015, had to undergo the task of winning back the lost market. Over a period of 8 months after its relaunch, the brand regained about 60% of its market back, but the question is how could such brand disaster be avoided in future? The case revolves around a major brand recovering from a brand disaster, and whether they did it well enough or could the situation have been managed better. It also enquires as to what road should be taken forward from here. It notes the action taken by the government against the brand and leaves it to the judgment of the readers if the actions taken against the brand were a little too harsh, solely because MNCs are usually considered a soft target in India. The readers must also understand and analyse the different brand relaunch strategies that were adopted by NESTLÉ and the next steps that should be taken by it.

The case describes the structure of Infrastructure Investment Trusts (InvITs) created and launched in Indian markets in 2017. Besides introducing InvITs and their potential role in relaxing the financing constraint created by the lack of an active corporate debt market in India, the case can help in analysing why the market is discounting the IndiGrid unit price relative to its issue price. It also offers an opportunity to value IndiGrid's Patran acquisition.

Aster Retail (AR) is the retail pharmacy division of the Aster Dr Moopen's Healthcare (ADMH) Group. The group delivers healthcare services across the Middle East, India and the Far East, with a portfolio of hospitals, clinics, diagnostic centres and retail pharmacies. AR, under the leadership of Chief Executive Officer (CEO) Jobilal Vavachan, is well known for its people-centric approach, unique culture and innovative human resource (HR) practices. AR has won multiple awards for HR practices, service quality and business performance. In a recent corporate restructuring (2018), “Aster Primary Care” was carved out by combining the group's Clinics and Retail businesses. This case discusses the evolution of AR's HR journey and the challenges associated with integrating culturally diverse businesses without compromising the values of ADMH and its promise, “We'll Treat You Well.”

This short case could be handed out at the end of class discussion on “J&L Railroad” [UVA-F-1053] in preparation for the following class, or if students are more experienced with hedging and option pricing, the instructor may choose to cover both cases in a single class period. It is the companion case to “J&L Railroad” [UVA-F-1053], and presents more technical issues regarding the hedging problem by requiring students to understand option-pricing principles. The board likes the CFO's hedging recommendations, but it wants a more careful analysis of the bank's prices for its risk-management products: the caps and floors. Besides demanding an understanding of option pricing, this case puts particular emphasis on the calculation and use of implied volatility.

The case revolves around a marketing/sales executive who works in the Ad Sales wing of a popular search engine. Over the course of the case, the protagonist realizes that their marketing strategy needs to refocus on a different vertical than the one they have been paying the most attention to. He had done the required data analysis and feels the data strongly points to a need for change in their strategy. However, he needs to convincing the higher management by put together a compelling pitch using storytelling elements, so that the message in his data gets across clearly, compelling them to act.