Management

The market, for quite some time, has been rife with rumours that Onjus, the orange drink, was up for sale. However, Managing director of Enkay Texofood, Tulsidas Goyal, has all along been very clear that he was non going to mete out his brand at any cost. Today, as production of its two brands, Onjus and Life have stopped, rival brands such(prenominal) as Tropicana from the Pepsico stable and Real from Dabur have seized the moment to fountain the market. Goyal candidly admits that things did go wrong. Primarily because of the companys frameworks divisions losings due to the climbing prices of raw materials and excess production of polyester yarn. A consequence of this was that cash flows from the foods business was channeled into the textiles business. This didnt go down easy with financial institutions and they decided against investing in the foods business, leading to a shutdown of both its divisions. Moreover, unlike in textiles, where the sales were found on large credit terms, in foods it was advance fee which took care of its dealings with its distributors. It was thus easy to divert these rig funds to its textile operations. Today, both businesses are at a standstill with its textile and juice plants lying idle.

A restructuring illustration has been undertaken by the Industrial Development Bank of India (IDBI) and Bank of Maharashtra to unbundle the textile and foods divisions into separate entities. While Goyal wants to spin off his textiles division into a separate company under the name of Avon Synthetics and possibly sell it off in the future, Enkay Texofoods will continue with its Onjus and Life brands. In fact, it is only now, with the demerger of its businesses, that any kind of sell-off will be possible. patronage being offered nearly Rs 80 crore for Onjus, it is evident that Goyal does not reckon to sell the brand, in spite of pressure to do so from both MNCs and domestic companies. Why should he, he asks? After all, it is not easy to build a brand,... If you want to get a full essay, order it on our website: Orderessay

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