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Our diversified businesses represent our immense growth potential to generate
opportunities for creating and sustaining value for our stakeholders.
President & CEO Engro Corporation
Asad Umar, President & CEO Engro Corporation at Engro Excellence Award's
launching ceremony.
Hussain Dawood holds the seat of the corporation, Mr. Dawood is also the chairman
of Dawood Group Pakistan.
Apart from the chairmanship, Asad Umar held the position of CEO & President at
Engro Corporation from 2004–2012. He resigned on April 18, 2012 to join
Pakistan's emerging political party Pakistan Tehreek-e-Insaf (Movement of
Justice).Pakistan Tehreek-e-Insaf is set to form a provincil government in Khyber-
Pukhtonkhwa→ province of Pakistan.
Muhammad Aliuddin Ansari has been appointed as the new CEO & President of Engro
Corporation.
Board of Directors
Engro's Board of Directors is responsible for the overall supervision of the company.
Hussain Dawood (Chairman)
Muhammad Aliuddin Ansari (President & CEO)
Afnan Ahsan (Director)
Sarfaraz Ahmed Rehman (Director)
Shahzada Dawood (Director)
Khawaja Iqbal Hassan (Director)
Shahid Hamid Pracha (Director)
Shabbir Hashmi (Director)
Ruhail Mohammed (Director)
Khalid Siraj Subhani (Director)
Abdul Samad Dawood (Director)
Saad Raja (Director)
Engro Corporation
Engro Corporation is one of the leading Pakistani business conglomerates with stakes
in the fertilizer, food, power generation, petrochemicals, automation and terminal
storage industries. Having had undergone an employee led buyout in 1992 it has
expanded phenomenal in the past two decades.
As a holding company its subsidiaries include:
Engro Fertilizers Limited
Engro Foods Limited
Engro Polymers and Chemicals Limited
Engro Eximp Private Limited
Engro PowerGen Limited
Engro Vopak Limited
History
Founding days
In 1957, the search for oil by Pak Stanvac, an Esso/Mobil joint venture led to the
discovery of the Mari Gas field near Daharki – a small, remote area in Upper Sindh
province at the time. Esso proposed the establishment of a urea plant in that area
which led to a fertilizer plant agreement signed in 1964. In the subsequent year,
Esso Pakistan Fertilizer Company Limited was incorporated, with 75% of the shares
owned by Esso and 25% by the general public.
The construction of a urea plant commenced at Daharki in 1966 and production began
in 1968. At US $43 million with an annual production capacity of 173,000 tons, it
was the single largest foreign investment by a multinational corporation in Pakistan at
the time.
A full-fledged marketing organization was established which undertook agronomic
programs to educate the farmers of Pakistan. As the nation‟s first fertilizer brand,
Engro (then Esso) helped modernize traditional farming practices to boost farm
yields, directly impacting the quality of life not only for farmers and their families,
but for the nation at large. As a result of these efforts, consumption of fertilizers
increased in Pakistan, paving the way for the Company‟s branded urea called “Engro”,
an acronym for “Energy for Growth”.
As part of an international name change program, Esso became Exxon in 1978 and the
Company was renamed Exxon Chemical Pakistan Limited. The Company continued to
prosper as it relentlessly pursued productivity gains and strived to attain professional
excellence.
In 1991, Exxon decided to divest its fertilizer business on a global basis. The
employees of Exxon Chemical Pakistan Limited, in partnership with leading
international and local financial institutions, bought out Exxon‟s 75% equity. This was
at the time and perhaps still is the most successful employee buy-out in the corporate
history of Pakistan. Renamed as Engro Chemical Pakistan Limited, the Company has
gone from strength to strength, reflected in its consistent financial performance,
growth of the core fertilizer business, and diversification into other businesses.
Along the way, a major milestone in plant capacity upgrade coincided with the
employee led buy-out; innovatively optimizing our resources, Engro relocated fertilizer
manufacturing plants from the UK and US to its Daharki plant site – an
international first.
Esso to Exxon Limited
In 1978, it was decided to rename the company from Esso fertilizer company
limited to Exxon Chemical Pakistan Limited.
In 1991, Exxon decided to divest its fertilizer business on a global basis. The
employees of Exxon Chemical Pakistan Limited, in partnership with leading
international and local financial institutions, bought out Exxon‟s 75% equity. This was
at the time and perhaps still is the most successful employee buy-out in the corporate
history of Pakistan. Renamed as Engro Chemical Pakistan Limited, the Company has
gone from strength to strength, reflected in its consistent financial performance,
growth of the core fertilizer business, and diversification into other businesses.
As Engro Chemicals (further expansions)
It was year 1997 when Engro Chemical Pakistan limited decided to establish Engro
Vopak Terminal Limited on 50/50 partnership basis between Engro and Royal Vopack
of Netherlands, for handling bulk liquid chemical storage at Port Qasim Karachi. In
that same year Engro Asahi polymer Chemicals limited was established in a result of
joint venture between Mitsubishi Corporation and Asahi for the manufacturing and
marketing of PVC resin.
Recent history
The 21st century for Engro Corporation has thus far proved to be the most
successful era in the total life of Engro, from then onwards Engro has only faced
success and never looked back, 2003 was the year of the establishment of Engro
EXIMP, after which in 2005 Engro decided to diversify their business more by
venturing into the food business by establishing Engro Foods Limited, which is now
experiencing a great success and competing now with international brands
like Nestlé and Wall's Ice Cream.[citation needed]
Engro also ventured into the power generation business by setting up Engro Energy
Limited in 2006, which later on was renamed as "Engro Powergen Limited" in 2008.
It was established with the basic aim to play Engro's part to tackle the energy crisis
in the country.
In year 2007 Engro Asahi polymer divested its share in joint venture with Mitsubishi
and the company renamed as Engro Polymer and Chemicals Limited.
In 2010, keeping in view the immense diversification of Engro Chemical Pakistan
Limited, it was decided to rename the company as Engro Corporation as the holding
company.
Health Safety & Environment
We will manage and utilize resources and operations in such a way that the safety and
health of our people, neighbors, customers, and visitors is ensured. We believe our
safety, health and environmental responsibilities extend beyond protection and
enhancement of our own facilities
Ethics and Integrity
We do care how results are achieved and will demonstrate honest and ethical behavior
in all our activities. Choosing the course of highest integrity is our intent and we will
establish and maintain the highest professional and personal standards. A well-founded
reputation for scrupulous dealing is itself a priceless asset.
Our people
We strongly believe in the dignity and value of our people. We must consistently
treat each other with respect and strive to create an organizational environment in
which individuals are fairly treated, encouraged and empowered to contribute, grow and
develop themselves and help to develop each other. We do not tolerate any form of
harassment or discrimination.
Innovation & Risk Taking
Success requires us to continually strive to produce breakthrough ideas that result in
improved solutions and services. We encourage challenges to the status quo and seek
organizational environments in which ideas are generated, nurtured and developed.
Engro appreciates employees for well thought out risks taken in all realms of
business, and for the results achieved due to them, acknowledging the fact that not
all risks will result in success.
Community & Society
We believe that a successful business creates much bigger economic impact and value
in the community, which dwarfs any philanthropic contribution. Hence, sustainable
business development is to be anchored in commitment to engage with key stakeholders
in the community and society.
Engro Chemical
Engro Chemical Pakistan Limited then started a journey of venturing into other
sectors including foods, energy, industrial control and automation, PVC resin
manufacturing and marketing, and chemical terminal and storage.
In 2009 plans were announced of demerging the fertilizer business into an independent
operating company. The expansion and growth in the company necessitated a change in
the way the company operated and conducted business. Keeping in view the operations
of multi category businesses, expansion strategy and growth vision, the management
decided that the various businesses would be better served if the Company was
converted to a holding company. As a result it was decided to demerge the fertilizer
business and establish a holding company structure to manage the affairs of various
businesses.
Engro Fertilizers
Engro Fertilizers Limited was incorporated in June 2009 to manage the fertilizer
business post demerger. The demerger required the approval of the High Court of
Sindh, which was granted on December 9, 2009 after obtaining the requisite
approvals from the creditors and shareholders of the Company. The demerger became
effective from January 1, 2010. Consequently, all fertilizer business assets and
liabilities have been transferred to Engro Fertilizers Limited against the issue of
shares to the Company.
To reflect the change in the scope of mandate and scale of operations, Engro
Chemical Pakistan Limited has been renamed as „Engro Corporation Limited‟ with
effect from January 1, 2010. Engro Corp, as the holding company is responsible for
the long term vision of the company, overseeing the performance of the subsidiaries
and affiliates, allocation of capital, management of talent, leadership development, HR
guiding policies, leadership role in public relations and CSR activities, control
structures, legal and IT support.
Engro Corp
Engro Corp will maintain a lean structure with a focused scope, allowing maximum
empowerment to the subsidiaries and affiliates to drive the operations of their
respective organizations.
At Engro, we support our leadership culture through unique systems and policies
which ensure open communication, foster an environment of employee and partner
privacy, and guarantee the well being and safety of our employees.
Our core values form the basis of everything we do at Engro; from formal decision
making to how we conduct our business to spot awards and recognition. At Engro we
never forget what we stand for. Following are our core values:
Engro food Pakistan
the local flavor with a global vision
Engro Foods is among the biggest and fastest growing conglomerates in Pakistan with
a vision to cater to local needs with products conforming to global standards.
Highly passionate about providing millions of people across the length and breadth of
Pakistan and beyond with the ultimate brand experience, our product portfolio
comprises some of the country's biggest and best selling brands including Olper's,
Olper's Lite, Olfrute, O'more, Omung, Omung Lassi and Tarang.
But whether it is our thick, creamy all-purpose milk, scrumptious ice-cream high on
nutrition content or refreshing range of fruity beverages, our approach remains
largely the same as we strive to keep product innovation at the forefront of our
guiding philosophy and consumer satisfaction at the heart of our operational strategy.
Awards achieved by Engro corp
Eman won Pakistan‟s InfoComm Technology (ICT) Award (Karachi, Oct 2011)
Eman won Merit Award in the regional Asia Pacific InfoComm Technology Award
(APICTA) (Thailand, Nov 2011)
Engro Corporation being named “The most preferred graduate employers in Pakistan,
2011” by engage consulting
Engro Vopak tops the list at the Vopak Asia Awards 2010
Engro Rupiya Certificates declared the best transaction award of 2010 by CFA
Association of Pakistan
Engro Corp awarded the KSE top 10 companies award for the year 2008-2009
Engro Zarkhez won the coveted title of “Brands of the Year” award
Engro Corp won the Investor Relations Award by CFA Association of Pakistan
Corporate offices of Engro Corporation & Engro Fertilizers received “Green Office”
Certifications- becoming one of the only three companies in Pakistan to receive Green
Office Diploma
Engro Polymer & Chemicals won Best Annual Report- 2nd in chemical sector by
ICAP
Engro Corp and Engro Polymer & Chemicals won “living the global compact”
Responsible business award 2010-11 by Global Compact
Engro Corp won the Best Sustainability Report Award 2010 followed by Merit
Certificates for reporting under GRI framework by ICAP
Environmental Analysis
Asteriois G Kefalas in his book, Global business strategy: A system approach,
explains that how and why an environment is concerned to a nature of business and
business organization.
THE MACROENVIRONMENT
Macro environment is actually a big picture of the surrounding environment in which a
business and organization operates. Understanding the macro environment of a country
or the world requires understanding the relationship between humans and their natural
habitat. The resources and the carrying capacities of the natural habitat affect both
the quantitative aspects (such as population volume and growth rates) and the
cultural aspects (such as social, political, and economic behaviours) of human life.
MICROENVIRONMENT
The microenvironment has been defined as a particular organization's external business
environment. Studying the micro business environment helps manager to set the
organization‟s objectives by matching the organization‟s internal strengths and
weaknesses with the uncontrollable probabilities within that specific business
environment.
Engro Corporation limited operates in that part of the world where dramatic and
unexpected changes are always expected that requires the organization‟s analysts and
mangers to keep an extreme eye on what‟s going on. Here i am going to present
different analysis to help understand the environment in which Engro corporation exist.
PESTLE
Pestle analysis categorically involves the factors which are directly concerned to
the macro environment and they are Political, economical, social, technological, legal
and ecological.
POLITICAL
Pakistan is currently suffering from political turmoil. On one hand where it is
struggling against the issue of terrorism which involves the international community
and international politics on the other hand it‟s facing internal political instability.
Because of the continuous military interference into government and politics the
Political forces, in the past, have not had enough chance to practice fundamental
democratic values. In result both political forces and the people of Pakistan have not
yet been able to achieve the political maturity which can be seen in the western,
American and other democracy dominant societies. The overall situation is further
resulting into the empowerment of unreliable and corrupt executives who are usually
responsible of making economic and social policies. That is why Pakistan is not
achieving required economic and social goals yet. The policy makers usually involve in
taking kick backs and turning policies into their personal interest, after 9/11 the
war against terror has put a great impact on Pakistan and is actually resulting into
the destruction of peace of the country. International communities and investors are
hesitating to invest in Pakistan. Even though the tax policy, employment laws,
environmental regulations, trade restrictions and tariff regulations have been
formulated but implementation on these policies is not being conducted in mannered way.
Also there is a need of brining new economic and agriculture reforms.Especialy the
agriculture tax reforms where the per unit land tax price has been a big issue over
the times. Employment laws have been formulated according to the international
standards but child labour issue needs to be addressed on war grounds. Being a
member of WTO Pakistan supports the free market and free trade ideology but in
fact no such „‟free market‟‟ is in practice in the modern world. Every country has
some trade barriers to protect local industry, so does Pakistan. An anti dumping duty
ordinance is in place to protect local industry that also encourages local industrialists
to invest further. The tariff rates and policies are being reviewed over the time.
Having all these positive indications Pakistan still needs to modernize the trade and
industrial sectors by developing transparent policies. In the current time the civil
society of Pakistan seems to be awakening to break the political and feudal status quo
that will help Pakistan, in future, to develop a civilized political culture.
When we analyze the Engro Corporation having the above environment in backgrounds
and beyond we need to give considerable attention to the Engro‟s internal strengths
and weaknesses. Here i would talk about Engros‟s internal strengths in comparison of
that particular environment. On one hand Engro has tried to keep away from being
politically attached to that atmosphere and has concentrated properly on its business
which has helped it to become not polluted professional organization. On the other hand
Engro has been complying with the country‟s law and cultural values. Because of the
strong internal culture and commercialism company has strengthen itself to compete
with various kinds of political circumstances.
ECONOMICAL
Pakistan‟s economic growth rate is currently 5.5% which was 8% once in 2005 but
huge shortage of electricity and political instability has affected the growth rate.
Economic growth of Pakistan can be seen through gross domestic purchasing power
parity, which was estimated to be $454.2 billion in 2008. Official exchange rate was
approximately $160.9 billion, while real growth rate in 2008 GDP of Pakistan, as
per statistical data was found to be 4.7 percent. GDP per capita income was $2,600
in 2008. Interest rates are slightly high in Pakistan because of IMF conditional
bailout programme and were rose by 15% in 2009.purcasing power of Pakistanis has
been shaken up by 13% of inflation rate. Wage rates, minimum wages and 60 hours
per week working time in manufacturing sector and 48 hours in service sectors are
very suitable for large and international businesses. High percentage of unemployment
is resulting to be suitable for cheap labour provision but it increases the inflation rate
that affects business directly on the other hand. Country‟s cost of living is lower
comparing to developed countries. Engro Corporation is directly affected by these
factors. Engro has tried to take benefit from availability of cheap labour but interest
rates are putting a negative effect on engro‟s internal economy because it has
financing relations with most banks in Pakistan also with some international banks like
HSBC,Barclays etc . Inflation rate is also affecting engro especially engro foods
which involves direct relation with public purchasing power on broad levels. On the
other side the global economy is facing a downturn in recent times. The economic
recession has rolled largest economies in the world. Engro needs to have a deep look
on this factor in order to develop strategies for international perspective.
SOCIAL
Pakistan is an agricultural country, 70% population living in rural areas, 98%
population is Muslim. 42% population under 15 years of age only 4% over 64 years
of age .2% per year population growth rate, 65% literacy rate. The geographic
area of country is known to be one of oldest civilizations in the world. But because of
poor economic condition the awareness about health consciousness, safety and global
warming has not been very significant but now the awareness ratio on these issues is
rising rapidly in the society. Increasing literacy rate especially in IT and engineering
sectors have changed the career attitudes in the country. A strong business and
industry culture is developing itself influencing by different factors. Engro
Corporation is directly serving to 96%of the country‟s population. A large portion is
covered by engro fertilizer. Engro foods is taking health consciousness into the
consideration for its product development. Engro is building Pakistan‟s first green
power house to tackle the global warming issue. International health and safety
standards have been achieved by Engro within all its industries especially in chemical
industry. Providing employment on large scale Engro has shared the change in career
attitudes.
TECHNOLOGICAL
In the modern age technology is advancing and improving every day. These advances
are not only influencing corporate businesses but equally influencing the societies as a
whole by bringing the change into social behaviours. On the corporate level as the
organizations adopting the horizontal and vertical integrating method, Getting as more
as possible technological strength is a powerful weapon to achieve the corporative
integrity. Pakistan as a developing country needs technological advancement in every
sector of economy ranging from electricity generation, road construction, port and
airport developments, data base structuring, information technology railway, food
industry, oil and gas sector, logistics and many more. Government is privatizing and out
sourcing mega projects and multi industry sectors to save costs and to gain financial
balance. Especially in oil and energy sectors Pakistan needs huge investments. These
requirements and circumstances are actually a massive potential market for the
organizations which have well-built technological resources. Engro takes advantage
from this availability and has offered in sourcing to the government in multi sectors
like currently working on a power house project with the collaboration of government.
The project is called „‟Thar coal power project‟‟ which is spouse to produce
1200MW electricity for the country using coal reserves.
ENVIRONMENTAL
Being a developing country Pakistan is considered to be one of those countries where
the ecological and environmental aspect needs special concentration. Pakistan has six
metropolitan cities which have heavy industry manufacturing textile, leather products,
fertilizers, steel goods etc. Most of the country‟s vehicles run on diesel and petrol.
Small level industry like brick making and small steel melting units leave a big
amount of carbondyoxide in the air. Clean drinking water is also a big issue in the
country. Handling and recycling wastage from manufacturing sector is most critical
aspect of the ecological concerns in Pakistan. On the other hand diseases due to dirty
water and improper food are also a challenge for the country. All above issues are
influencing Pakistan both economically and socially. But on the same time there is a
huge potential for investments from eco friendly organizations to compete against these
challenges. Implementation on environmental regulations is on high demand from the
global society as well. Engro being part in this environment is playing its role by
internally implementing the related laws and standards like , process safety,
workforce safety, workplace health, food safety, risk assessment, and environmental
performance. In the field engro is building Pakistan‟s first green power house in
Sindh province and looks ahead for many other projects.
LEGAL
Having been developed with in business laws and taxation laws according to the
international standard legal situatations in Pakistan are at satisfactory level. Recent
business legislations have helped the country to be suitable for international
investments. No restrictions on joint ventures and revision of tax ordinance 2001-2002
are the latest achievements towards investment friendly society. But overall small
tax „‟base‟‟ and unsatisfactory tax collection system along with economic and political
situations present a negative impact on country‟s economy. Also implementation on
import/export laws concerning duty and custom tax is significantly lacking. But now as
the modern educated youth is entering into the country‟s judicial and legislative
institutions the overall circumstances are getting better and better. Also the
awareness about economic globalization in the general population is increasing day by
day that will soon reflect into the more betterment of legislation and legalization
circumstances. To protect the local fertilizer industry government has passed a law
of imposing anti-dumping duty on fertilizer‟s import and has allowed the industry to
import fertilizer plant equipments without paying any tax . Beyond the facility of
taxation policy and joint venture legalization in Pakistan Engro has taken a step of
being part of an international business joint venture that is called „‟Avanceon‟‟
Advanced Automation LP, a leading provider of technology solutions to manufacturers
In north US, Innovative Automation & Engineering, FZ, a leading Dubai based
engineering & system integration company serving Middle East and African Oil &
Gas, Water, Waste Water, Infrastructure, and Manufacturing industries; and Engro
Innovative Automation Pvt. Ltd., a global provider of industrial automation and
engineering support products and services announced a joint venture under the name of
AVANCEON.
FORMULATION STRATEGY
In formulating a strategy, the strategic decision makers of Engro Fertilizers must
analyze conditions internal to the organization. An internal analysis leads to a realistic
company profile, which is the determination of a firm's strategic competencies and
weaknesses. The development of a
Company profile in four-step process:
Managers audit and examine key aspects of the business's operation, seeking to
target key areas for further assessment.
Managers evaluating the firm's status on these factors by comparing their
current condition with past abilities of the firm.
Managers seek some comparative basis - linked to key industry or
product/market conditions - against which to more accurately determine whether the
company's condition on a particular factor represents a potential strength or
weakness.
In internal analysis is to provide the results, or company profile, as input into
the strategic management process.
An internal organizational analysis evaluates all relevant factors in an organization in
order to determine its strengths and weaknesses. Some of the areas that Engro
Fertilizers should analyze include the following:
1. Financial position. The financial position of a business plays a crucial role in
determining what it can or cannot do in the future.
2. Research and development capability. Engro Fertilizers pays continuous importance
to research as it ventures into new and upgraded products continuously.
A culture of continuous innovation is stressed on and engagement surveys carried out to
find out further input from the employees.
There are a couple of government institutions like NFDC, who carry out research.
Outsourcing through research agencies is also quite common and field resources, such
as getting information from the farmers is also given importance to.
3. Organizational structure. Organizational structure can either help or hinder an
organization in achieving its objectives. In case of Engro Fertilizers, the organizational
structure is a mixture of horizontal and vertical importance. The informal
communication helps information to flow in a strong way. Other practices like „whistle
blowing‟ and feedback emails like the „Speak Out‟ continuously decides what actions
should be taken by the Committee and the areas where it should improve.
No major restructuring has taken place since the time of its inception and Engro
Fertilizers continues to evolve as a matrix organization that enjoys the benefits of
formal and informal organizational practices.
4. Human resources. All the activities of an organization are significantly influenced
by the quality and quantity of its human resources. As discussed above, the Human
Resources at Engro, just like all of its subsidiaries are greatly valued and much
effort put to improve it.
5. Condition of facilities and equipment. The condition of an organization's facilities and
equipment can either enhance or hinder its competitiveness.
Internal analysis is difficult and challenging. The checklists provided above can be
helpful in determining specific strengths and weaknesses in the functional areas of
business.
CORPORATE STRATEGY
Corporate strategy is based on Engro‟s core competence – Engro is the pioneer of
fertilizer in Pakistan, they have a strong Urea business model and to complement it
they have built the most efficient and largest single train urea plant in World –
Enven, having a capacity of 1.3 mn tonnes and an investment of USD 1.05 bn, by the
far the largest private sector industrial investment in Pakistan.
Other key strengths of the company include efficient management, company‟s ability
to deliver and a strong profitable group of subsidiaries. As the CFO, Naz Khan while
commenting on the current debt position of the company said ““Engro Corporation has
many subsidiaries, and there is no possibility of a default on payments whatsoever”.
As the company continued its growth in other sectors and in fertilizer sector building
the most efficient and largest single train urea plant in World – Enven, catching up
the capacity in fertilizer that is required by the current and future demand in
Pakistan, their direction for future growth is outside Pakistan considering the fact
that export of fertilizer is banned in Pakistan. Mr. Ali, Manager Market
Analysis & Planning told us that the new direction for the company is to develop
an off-shore plant based on the company‟s expertise in fertilizer sector catering to
the fertilizer demand in other countries. He said that currently we are on the
feasibility stage of our off-shore plant. Besides that he said that an agricultural-
led growth strategy is a step in the right direction. Even though the contribution of
agriculture sector to the country‟s GDP has declined from 65% in 1990‟s to around
21% at present, it is still a significant contributor to the GDP, employing 44
percent of the workforce.
BUSINESS LEVEL STRATEGY
Two of Engro Fertilizers Limited core products have been recognized for
extraordinary performance in the respective sectors of macronutrients (Engro Urea)
and micronutrients (Zingro). Engro Fertilizers Limited is a subsidiary of Engro
Corporation Limited (formerly Engro Chemical Pakistan Limited).
Engro Urea, the oldest and most trusted brand of high-grade nitrogenous fertilizer in
Pakistan, is Engro Fertilizers‟ premier macro nutrient product. Zingro, introduced in
2004, has been developed as a high-grade zinc fertilizer targeting zinc deficiencies in
crops such as rice, resulting in greater yield and an improved end-product.
This recognition for Engro Urea and Zingro is a testimony to the strength of Engro
Fertilizers‟ brands, as well as the strength of the brand teams‟ resolve and hard
work put into making Engro a premier brand owner in the fertilizer industry. With
this Award, Engro Fertilizers Limited has joined the ranks of several of Pakistan‟s
premier brand owners, including the likes of previous winners such as Toyota, TCS,
P&G, Standard Chartered, Pizza Hut, Marriot, K&N‟s, Berger Robbialac,
Castrol, Bonanza, Dadex, Dunkin Donuts, Head & Shoulders, Ideas, Intel, Inbox, and
RoohAfza, among others.
The „Brands of the Year Award‟ is the first-of-its-kind hallmark for Brand
Recognition in Pakistan, and aim to highlight and encourage the best brands in the
Country. It is an annual endeavor, resulting from the joint efforts of The Exhibitor
Group, Pakistan Standards and Quality Control Authority (PSQCA) and the
Intellectual Property Organization (IPO-Pakistan).The awards have garnered
significant international acclaim, and are conducted and duly endorsed by Brands
Bureau International Limited London – UK & Brands University.
SWOT ANALYSIS OF ENGRO FOODS
STRENGTH:-
Organizational strength is skills and capabilities that enable an organization to conceive
of and implement its strengths. The strength of ENGRO FOODS has strong and
well established brands. They are very lucky in this sense they have most
experienced sponsors from market. The most important strength of this industry is its
proactive management who is operating well and they have also the strong and vast
distribution network al over the Pakistan.
WEAKNESSESS:-
Organization weaknesses skills and capabilities that do not enable an organization to
choose and implement strategies that support its mission. The firs and the basic
weakness of engro foods that create alarming situation for them that is little
experience in FMCG, sector as nestle has been practicing in this sector for the last
three decades .They also need significant investment in research and development to
make the brands best and from others. They have little experience in powered
segment which plant to inter by 2013.engro foods project is unable to fulfill demand
of local powder milk product.
OPPORTUNITIES:-
Organization opportunities are areas those may generate higher performance EF has
huge potential in liquid dairy products. They have large and vast system of powered
segment and it has the threat for its competitor. It has significant growth potential in
North American meat market.
THREATS:-
Organization threats are areas that increase the difficulty in organizations. The
biggest threat for EF is the competitors. Risk of price war in ice cream as walls
enjoying higher economics on scales. Nestlé‟s huge investment in powered segment
could be a entry barriers. The other important threat for this company is due to
high return prospects, other players may also try to enter in this segment.
SWOT ANALYSIS OF ENGRO CHEMICALS
STRENGTH:-
Different strategies call on different skills and capabilities. It has strong
performance management. Management parties and principals inherited from EXXON
chemical USA after the management buyout in 1991.They are also enjoying the
subsidies of gas pricing during the last 10 years. In the result of this subsidy they
have strong accumulated reserves low gearing will provide the financial strength in
upcoming years.
The most golden part of its strength is this that 50% joint ventures, ENGRO vopak
has completed 4 years of profitable operations. They have not only a strong customer
circle but also have product research. They are also enjoying large market share of
engro innovative and chemicals. They also have good reputation in market by strong
brand.
WEAKNESSES:-
Weaknesses is not good for any company‟s strength while engro vopak is performing
satisfactory deterioration in operating results of engro SAHI could result in SAHI
calling financial support in ECPL.
Engro urea doesn‟t command the same market premium as competitors. Fiji fertilizers
Sona urea is sold in Punjab province where engro has strong market in Sindh province
only,
OPPORTUNITIES:-
New petrochemical project is helping to improve profitability of engro chemical.
Besides this opportunity they have launched the larger segment of value addition chain
for reducing business risk through this strategy. They have also had an opportunity
to merge with their global business to cope with the competitors. They have potential
to innovate and differentiate company‟s product for sustaining a competitive advantages.
THREATS:-
The main threat and problem that occurs when there is a competitive and technological
threats are created.The highlight and major internal factor which will affect the
company‟s performance that are size, strength. Cost, revenues and strategy as well
as external factors competitive positioning and industry trade. They are also facing
the high inflation rate along with low purchasing power. Most of the investors are
not investing due to the low rate of interest and the uncertain condition in market.
They are also coping with the recessionary period in business cycle. Engro chemical
is also facing the increase in sales tax.
SWOT ANALYSIS OF ENGRO FERTILIZERS
Strength:-
The investors, the players, who are operating in this sector, are financially strong
and they can start production in new product line. By adding some new unit they can
enhance the production capacity of utilization. They have also a well distribution
centers and all the companies in this industry have developed a well planned network
field, Warehouses to insure that fertilizers are available to the farmer
uninterrupted. They also peruse an innovative education oriented advertising policy,
utilizing print media and road side advertisement. The major part of strength that all
the fertilizer plants are producing at more than 100 percent installed capacity of
utilization.
WEAKNESES:-
They have more weakness than the other sector of engro projects due to the
backward in the technology along with low resources. They are facing such troubles
like demand is increasing day by day and the capacity of plants to produce fertilizers
are getting decrease. Farmers have to pay above than the stated price because of
existence of black market and heavy demand. There is another factor that we can‟t
deny that the low advertising campaigns.
OPPORTUNITIES:-
The project of engro, Engro fertilizers is enjoying high benefit from the market and
from the government as well. As an agriculture country it has a great support of
govt in fertilizer sector. There is no quota restriction by WTO since 2005, so there
is more opportunity to export. Availability of gas from Iran can also increase the
production for industry and fulfill the demand.
THREATS:-
Due to uncertain political situation in country govt policies are not consistent regarding
fertilizer industry. Unstable political condition is also a big threat for fertilize
industry. A natural; gas is main raw material and is supply is also a problem. The
fuel price is also increasing due to the fuel crises in the international market. The
biggest threat for the engro fertilizer is that imported fertilizers are available at
cheap prices than local fertilizers. So, the farmer gives more important rather than
the local products.
BIBLIOGRAPHY
INFORMATION COLLECTED VIA BOOKS
Annual repoart
Quarterly financial report
Invester‟s blog
BY READING INTERVIEW OF CEO OF ENGRO
President & CEO Engro Corporation
INFORMATION COLLECTED VIA INTERNET
Encyclopedia
Wikipedia
Google
Engro corporation
BY READING NEWS PAPER
JUNG & DAWN NEWS PAPER
Table of contents
Contents page no
Introduction……………………………………………………
Engro food…………………………………………………….
Engro chemical………………………………………………..
Engro fertilizer…………………………………………….…
Award achievement……………………………………………
Environmental analysis………………………………………..
Formulation strategy………………………………………….
Corporate strategy…………………………...………………
Business level strategy……………………….……………..
SWOT analysis…………………………………………..…...
Engro food………………………………………………
Engro chemical…………………………………………
Engro fertilizer……………………………………….
BCG Matrix………………………………………………….
Bibliography …………………………………………………

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  • 1. Our diversified businesses represent our immense growth potential to generate opportunities for creating and sustaining value for our stakeholders. President & CEO Engro Corporation Asad Umar, President & CEO Engro Corporation at Engro Excellence Award's launching ceremony. Hussain Dawood holds the seat of the corporation, Mr. Dawood is also the chairman of Dawood Group Pakistan. Apart from the chairmanship, Asad Umar held the position of CEO & President at Engro Corporation from 2004–2012. He resigned on April 18, 2012 to join Pakistan's emerging political party Pakistan Tehreek-e-Insaf (Movement of Justice).Pakistan Tehreek-e-Insaf is set to form a provincil government in Khyber- Pukhtonkhwa→ province of Pakistan. Muhammad Aliuddin Ansari has been appointed as the new CEO & President of Engro Corporation.
  • 2. Board of Directors Engro's Board of Directors is responsible for the overall supervision of the company. Hussain Dawood (Chairman) Muhammad Aliuddin Ansari (President & CEO) Afnan Ahsan (Director) Sarfaraz Ahmed Rehman (Director) Shahzada Dawood (Director) Khawaja Iqbal Hassan (Director) Shahid Hamid Pracha (Director) Shabbir Hashmi (Director) Ruhail Mohammed (Director) Khalid Siraj Subhani (Director) Abdul Samad Dawood (Director) Saad Raja (Director)
  • 3. Engro Corporation Engro Corporation is one of the leading Pakistani business conglomerates with stakes in the fertilizer, food, power generation, petrochemicals, automation and terminal storage industries. Having had undergone an employee led buyout in 1992 it has expanded phenomenal in the past two decades. As a holding company its subsidiaries include: Engro Fertilizers Limited Engro Foods Limited Engro Polymers and Chemicals Limited Engro Eximp Private Limited Engro PowerGen Limited Engro Vopak Limited History Founding days In 1957, the search for oil by Pak Stanvac, an Esso/Mobil joint venture led to the discovery of the Mari Gas field near Daharki – a small, remote area in Upper Sindh province at the time. Esso proposed the establishment of a urea plant in that area which led to a fertilizer plant agreement signed in 1964. In the subsequent year, Esso Pakistan Fertilizer Company Limited was incorporated, with 75% of the shares owned by Esso and 25% by the general public.
  • 4. The construction of a urea plant commenced at Daharki in 1966 and production began in 1968. At US $43 million with an annual production capacity of 173,000 tons, it was the single largest foreign investment by a multinational corporation in Pakistan at the time. A full-fledged marketing organization was established which undertook agronomic programs to educate the farmers of Pakistan. As the nation‟s first fertilizer brand, Engro (then Esso) helped modernize traditional farming practices to boost farm yields, directly impacting the quality of life not only for farmers and their families, but for the nation at large. As a result of these efforts, consumption of fertilizers increased in Pakistan, paving the way for the Company‟s branded urea called “Engro”, an acronym for “Energy for Growth”. As part of an international name change program, Esso became Exxon in 1978 and the Company was renamed Exxon Chemical Pakistan Limited. The Company continued to prosper as it relentlessly pursued productivity gains and strived to attain professional excellence. In 1991, Exxon decided to divest its fertilizer business on a global basis. The employees of Exxon Chemical Pakistan Limited, in partnership with leading international and local financial institutions, bought out Exxon‟s 75% equity. This was at the time and perhaps still is the most successful employee buy-out in the corporate history of Pakistan. Renamed as Engro Chemical Pakistan Limited, the Company has gone from strength to strength, reflected in its consistent financial performance, growth of the core fertilizer business, and diversification into other businesses. Along the way, a major milestone in plant capacity upgrade coincided with the employee led buy-out; innovatively optimizing our resources, Engro relocated fertilizer manufacturing plants from the UK and US to its Daharki plant site – an international first.
  • 5. Esso to Exxon Limited In 1978, it was decided to rename the company from Esso fertilizer company limited to Exxon Chemical Pakistan Limited. In 1991, Exxon decided to divest its fertilizer business on a global basis. The employees of Exxon Chemical Pakistan Limited, in partnership with leading international and local financial institutions, bought out Exxon‟s 75% equity. This was at the time and perhaps still is the most successful employee buy-out in the corporate history of Pakistan. Renamed as Engro Chemical Pakistan Limited, the Company has gone from strength to strength, reflected in its consistent financial performance, growth of the core fertilizer business, and diversification into other businesses. As Engro Chemicals (further expansions) It was year 1997 when Engro Chemical Pakistan limited decided to establish Engro Vopak Terminal Limited on 50/50 partnership basis between Engro and Royal Vopack of Netherlands, for handling bulk liquid chemical storage at Port Qasim Karachi. In that same year Engro Asahi polymer Chemicals limited was established in a result of joint venture between Mitsubishi Corporation and Asahi for the manufacturing and marketing of PVC resin. Recent history The 21st century for Engro Corporation has thus far proved to be the most successful era in the total life of Engro, from then onwards Engro has only faced success and never looked back, 2003 was the year of the establishment of Engro EXIMP, after which in 2005 Engro decided to diversify their business more by venturing into the food business by establishing Engro Foods Limited, which is now experiencing a great success and competing now with international brands like Nestlé and Wall's Ice Cream.[citation needed]
  • 6. Engro also ventured into the power generation business by setting up Engro Energy Limited in 2006, which later on was renamed as "Engro Powergen Limited" in 2008. It was established with the basic aim to play Engro's part to tackle the energy crisis in the country. In year 2007 Engro Asahi polymer divested its share in joint venture with Mitsubishi and the company renamed as Engro Polymer and Chemicals Limited. In 2010, keeping in view the immense diversification of Engro Chemical Pakistan Limited, it was decided to rename the company as Engro Corporation as the holding company. Health Safety & Environment We will manage and utilize resources and operations in such a way that the safety and health of our people, neighbors, customers, and visitors is ensured. We believe our safety, health and environmental responsibilities extend beyond protection and enhancement of our own facilities Ethics and Integrity We do care how results are achieved and will demonstrate honest and ethical behavior in all our activities. Choosing the course of highest integrity is our intent and we will establish and maintain the highest professional and personal standards. A well-founded reputation for scrupulous dealing is itself a priceless asset. Our people We strongly believe in the dignity and value of our people. We must consistently treat each other with respect and strive to create an organizational environment in which individuals are fairly treated, encouraged and empowered to contribute, grow and develop themselves and help to develop each other. We do not tolerate any form of harassment or discrimination.
  • 7. Innovation & Risk Taking Success requires us to continually strive to produce breakthrough ideas that result in improved solutions and services. We encourage challenges to the status quo and seek organizational environments in which ideas are generated, nurtured and developed. Engro appreciates employees for well thought out risks taken in all realms of business, and for the results achieved due to them, acknowledging the fact that not all risks will result in success. Community & Society We believe that a successful business creates much bigger economic impact and value in the community, which dwarfs any philanthropic contribution. Hence, sustainable business development is to be anchored in commitment to engage with key stakeholders in the community and society.
  • 8. Engro Chemical Engro Chemical Pakistan Limited then started a journey of venturing into other sectors including foods, energy, industrial control and automation, PVC resin manufacturing and marketing, and chemical terminal and storage. In 2009 plans were announced of demerging the fertilizer business into an independent operating company. The expansion and growth in the company necessitated a change in the way the company operated and conducted business. Keeping in view the operations of multi category businesses, expansion strategy and growth vision, the management decided that the various businesses would be better served if the Company was converted to a holding company. As a result it was decided to demerge the fertilizer business and establish a holding company structure to manage the affairs of various businesses.
  • 9. Engro Fertilizers Engro Fertilizers Limited was incorporated in June 2009 to manage the fertilizer business post demerger. The demerger required the approval of the High Court of Sindh, which was granted on December 9, 2009 after obtaining the requisite approvals from the creditors and shareholders of the Company. The demerger became effective from January 1, 2010. Consequently, all fertilizer business assets and liabilities have been transferred to Engro Fertilizers Limited against the issue of shares to the Company. To reflect the change in the scope of mandate and scale of operations, Engro Chemical Pakistan Limited has been renamed as „Engro Corporation Limited‟ with effect from January 1, 2010. Engro Corp, as the holding company is responsible for the long term vision of the company, overseeing the performance of the subsidiaries and affiliates, allocation of capital, management of talent, leadership development, HR guiding policies, leadership role in public relations and CSR activities, control structures, legal and IT support.
  • 10. Engro Corp Engro Corp will maintain a lean structure with a focused scope, allowing maximum empowerment to the subsidiaries and affiliates to drive the operations of their respective organizations. At Engro, we support our leadership culture through unique systems and policies which ensure open communication, foster an environment of employee and partner privacy, and guarantee the well being and safety of our employees. Our core values form the basis of everything we do at Engro; from formal decision making to how we conduct our business to spot awards and recognition. At Engro we never forget what we stand for. Following are our core values:
  • 11. Engro food Pakistan the local flavor with a global vision Engro Foods is among the biggest and fastest growing conglomerates in Pakistan with a vision to cater to local needs with products conforming to global standards. Highly passionate about providing millions of people across the length and breadth of Pakistan and beyond with the ultimate brand experience, our product portfolio comprises some of the country's biggest and best selling brands including Olper's, Olper's Lite, Olfrute, O'more, Omung, Omung Lassi and Tarang. But whether it is our thick, creamy all-purpose milk, scrumptious ice-cream high on nutrition content or refreshing range of fruity beverages, our approach remains largely the same as we strive to keep product innovation at the forefront of our guiding philosophy and consumer satisfaction at the heart of our operational strategy.
  • 12. Awards achieved by Engro corp Eman won Pakistan‟s InfoComm Technology (ICT) Award (Karachi, Oct 2011) Eman won Merit Award in the regional Asia Pacific InfoComm Technology Award (APICTA) (Thailand, Nov 2011) Engro Corporation being named “The most preferred graduate employers in Pakistan, 2011” by engage consulting Engro Vopak tops the list at the Vopak Asia Awards 2010 Engro Rupiya Certificates declared the best transaction award of 2010 by CFA Association of Pakistan Engro Corp awarded the KSE top 10 companies award for the year 2008-2009 Engro Zarkhez won the coveted title of “Brands of the Year” award Engro Corp won the Investor Relations Award by CFA Association of Pakistan Corporate offices of Engro Corporation & Engro Fertilizers received “Green Office” Certifications- becoming one of the only three companies in Pakistan to receive Green Office Diploma Engro Polymer & Chemicals won Best Annual Report- 2nd in chemical sector by ICAP Engro Corp and Engro Polymer & Chemicals won “living the global compact” Responsible business award 2010-11 by Global Compact Engro Corp won the Best Sustainability Report Award 2010 followed by Merit Certificates for reporting under GRI framework by ICAP
  • 13. Environmental Analysis Asteriois G Kefalas in his book, Global business strategy: A system approach, explains that how and why an environment is concerned to a nature of business and business organization. THE MACROENVIRONMENT Macro environment is actually a big picture of the surrounding environment in which a business and organization operates. Understanding the macro environment of a country or the world requires understanding the relationship between humans and their natural habitat. The resources and the carrying capacities of the natural habitat affect both the quantitative aspects (such as population volume and growth rates) and the cultural aspects (such as social, political, and economic behaviours) of human life. MICROENVIRONMENT The microenvironment has been defined as a particular organization's external business environment. Studying the micro business environment helps manager to set the organization‟s objectives by matching the organization‟s internal strengths and weaknesses with the uncontrollable probabilities within that specific business environment. Engro Corporation limited operates in that part of the world where dramatic and unexpected changes are always expected that requires the organization‟s analysts and mangers to keep an extreme eye on what‟s going on. Here i am going to present different analysis to help understand the environment in which Engro corporation exist.
  • 14. PESTLE Pestle analysis categorically involves the factors which are directly concerned to the macro environment and they are Political, economical, social, technological, legal and ecological. POLITICAL Pakistan is currently suffering from political turmoil. On one hand where it is struggling against the issue of terrorism which involves the international community and international politics on the other hand it‟s facing internal political instability. Because of the continuous military interference into government and politics the Political forces, in the past, have not had enough chance to practice fundamental democratic values. In result both political forces and the people of Pakistan have not yet been able to achieve the political maturity which can be seen in the western, American and other democracy dominant societies. The overall situation is further resulting into the empowerment of unreliable and corrupt executives who are usually responsible of making economic and social policies. That is why Pakistan is not achieving required economic and social goals yet. The policy makers usually involve in taking kick backs and turning policies into their personal interest, after 9/11 the war against terror has put a great impact on Pakistan and is actually resulting into the destruction of peace of the country. International communities and investors are hesitating to invest in Pakistan. Even though the tax policy, employment laws, environmental regulations, trade restrictions and tariff regulations have been formulated but implementation on these policies is not being conducted in mannered way. Also there is a need of brining new economic and agriculture reforms.Especialy the agriculture tax reforms where the per unit land tax price has been a big issue over the times. Employment laws have been formulated according to the international
  • 15. standards but child labour issue needs to be addressed on war grounds. Being a member of WTO Pakistan supports the free market and free trade ideology but in fact no such „‟free market‟‟ is in practice in the modern world. Every country has some trade barriers to protect local industry, so does Pakistan. An anti dumping duty ordinance is in place to protect local industry that also encourages local industrialists to invest further. The tariff rates and policies are being reviewed over the time. Having all these positive indications Pakistan still needs to modernize the trade and industrial sectors by developing transparent policies. In the current time the civil society of Pakistan seems to be awakening to break the political and feudal status quo that will help Pakistan, in future, to develop a civilized political culture. When we analyze the Engro Corporation having the above environment in backgrounds and beyond we need to give considerable attention to the Engro‟s internal strengths and weaknesses. Here i would talk about Engros‟s internal strengths in comparison of that particular environment. On one hand Engro has tried to keep away from being politically attached to that atmosphere and has concentrated properly on its business which has helped it to become not polluted professional organization. On the other hand Engro has been complying with the country‟s law and cultural values. Because of the strong internal culture and commercialism company has strengthen itself to compete with various kinds of political circumstances. ECONOMICAL Pakistan‟s economic growth rate is currently 5.5% which was 8% once in 2005 but huge shortage of electricity and political instability has affected the growth rate. Economic growth of Pakistan can be seen through gross domestic purchasing power parity, which was estimated to be $454.2 billion in 2008. Official exchange rate was approximately $160.9 billion, while real growth rate in 2008 GDP of Pakistan, as per statistical data was found to be 4.7 percent. GDP per capita income was $2,600 in 2008. Interest rates are slightly high in Pakistan because of IMF conditional bailout programme and were rose by 15% in 2009.purcasing power of Pakistanis has
  • 16. been shaken up by 13% of inflation rate. Wage rates, minimum wages and 60 hours per week working time in manufacturing sector and 48 hours in service sectors are very suitable for large and international businesses. High percentage of unemployment is resulting to be suitable for cheap labour provision but it increases the inflation rate that affects business directly on the other hand. Country‟s cost of living is lower comparing to developed countries. Engro Corporation is directly affected by these factors. Engro has tried to take benefit from availability of cheap labour but interest rates are putting a negative effect on engro‟s internal economy because it has financing relations with most banks in Pakistan also with some international banks like HSBC,Barclays etc . Inflation rate is also affecting engro especially engro foods which involves direct relation with public purchasing power on broad levels. On the other side the global economy is facing a downturn in recent times. The economic recession has rolled largest economies in the world. Engro needs to have a deep look on this factor in order to develop strategies for international perspective. SOCIAL Pakistan is an agricultural country, 70% population living in rural areas, 98% population is Muslim. 42% population under 15 years of age only 4% over 64 years of age .2% per year population growth rate, 65% literacy rate. The geographic area of country is known to be one of oldest civilizations in the world. But because of poor economic condition the awareness about health consciousness, safety and global warming has not been very significant but now the awareness ratio on these issues is rising rapidly in the society. Increasing literacy rate especially in IT and engineering sectors have changed the career attitudes in the country. A strong business and industry culture is developing itself influencing by different factors. Engro Corporation is directly serving to 96%of the country‟s population. A large portion is covered by engro fertilizer. Engro foods is taking health consciousness into the consideration for its product development. Engro is building Pakistan‟s first green power house to tackle the global warming issue. International health and safety
  • 17. standards have been achieved by Engro within all its industries especially in chemical industry. Providing employment on large scale Engro has shared the change in career attitudes. TECHNOLOGICAL In the modern age technology is advancing and improving every day. These advances are not only influencing corporate businesses but equally influencing the societies as a whole by bringing the change into social behaviours. On the corporate level as the organizations adopting the horizontal and vertical integrating method, Getting as more as possible technological strength is a powerful weapon to achieve the corporative integrity. Pakistan as a developing country needs technological advancement in every sector of economy ranging from electricity generation, road construction, port and airport developments, data base structuring, information technology railway, food industry, oil and gas sector, logistics and many more. Government is privatizing and out sourcing mega projects and multi industry sectors to save costs and to gain financial balance. Especially in oil and energy sectors Pakistan needs huge investments. These requirements and circumstances are actually a massive potential market for the organizations which have well-built technological resources. Engro takes advantage from this availability and has offered in sourcing to the government in multi sectors like currently working on a power house project with the collaboration of government. The project is called „‟Thar coal power project‟‟ which is spouse to produce 1200MW electricity for the country using coal reserves. ENVIRONMENTAL Being a developing country Pakistan is considered to be one of those countries where the ecological and environmental aspect needs special concentration. Pakistan has six metropolitan cities which have heavy industry manufacturing textile, leather products, fertilizers, steel goods etc. Most of the country‟s vehicles run on diesel and petrol. Small level industry like brick making and small steel melting units leave a big amount of carbondyoxide in the air. Clean drinking water is also a big issue in the
  • 18. country. Handling and recycling wastage from manufacturing sector is most critical aspect of the ecological concerns in Pakistan. On the other hand diseases due to dirty water and improper food are also a challenge for the country. All above issues are influencing Pakistan both economically and socially. But on the same time there is a huge potential for investments from eco friendly organizations to compete against these challenges. Implementation on environmental regulations is on high demand from the global society as well. Engro being part in this environment is playing its role by internally implementing the related laws and standards like , process safety, workforce safety, workplace health, food safety, risk assessment, and environmental performance. In the field engro is building Pakistan‟s first green power house in Sindh province and looks ahead for many other projects. LEGAL Having been developed with in business laws and taxation laws according to the international standard legal situatations in Pakistan are at satisfactory level. Recent business legislations have helped the country to be suitable for international investments. No restrictions on joint ventures and revision of tax ordinance 2001-2002 are the latest achievements towards investment friendly society. But overall small tax „‟base‟‟ and unsatisfactory tax collection system along with economic and political situations present a negative impact on country‟s economy. Also implementation on import/export laws concerning duty and custom tax is significantly lacking. But now as the modern educated youth is entering into the country‟s judicial and legislative institutions the overall circumstances are getting better and better. Also the awareness about economic globalization in the general population is increasing day by day that will soon reflect into the more betterment of legislation and legalization circumstances. To protect the local fertilizer industry government has passed a law of imposing anti-dumping duty on fertilizer‟s import and has allowed the industry to import fertilizer plant equipments without paying any tax . Beyond the facility of taxation policy and joint venture legalization in Pakistan Engro has taken a step of
  • 19. being part of an international business joint venture that is called „‟Avanceon‟‟ Advanced Automation LP, a leading provider of technology solutions to manufacturers In north US, Innovative Automation & Engineering, FZ, a leading Dubai based engineering & system integration company serving Middle East and African Oil & Gas, Water, Waste Water, Infrastructure, and Manufacturing industries; and Engro Innovative Automation Pvt. Ltd., a global provider of industrial automation and engineering support products and services announced a joint venture under the name of AVANCEON.
  • 20. FORMULATION STRATEGY In formulating a strategy, the strategic decision makers of Engro Fertilizers must analyze conditions internal to the organization. An internal analysis leads to a realistic company profile, which is the determination of a firm's strategic competencies and weaknesses. The development of a Company profile in four-step process: Managers audit and examine key aspects of the business's operation, seeking to target key areas for further assessment. Managers evaluating the firm's status on these factors by comparing their current condition with past abilities of the firm. Managers seek some comparative basis - linked to key industry or product/market conditions - against which to more accurately determine whether the company's condition on a particular factor represents a potential strength or weakness. In internal analysis is to provide the results, or company profile, as input into the strategic management process. An internal organizational analysis evaluates all relevant factors in an organization in order to determine its strengths and weaknesses. Some of the areas that Engro Fertilizers should analyze include the following: 1. Financial position. The financial position of a business plays a crucial role in determining what it can or cannot do in the future. 2. Research and development capability. Engro Fertilizers pays continuous importance to research as it ventures into new and upgraded products continuously.
  • 21. A culture of continuous innovation is stressed on and engagement surveys carried out to find out further input from the employees. There are a couple of government institutions like NFDC, who carry out research. Outsourcing through research agencies is also quite common and field resources, such as getting information from the farmers is also given importance to. 3. Organizational structure. Organizational structure can either help or hinder an organization in achieving its objectives. In case of Engro Fertilizers, the organizational structure is a mixture of horizontal and vertical importance. The informal communication helps information to flow in a strong way. Other practices like „whistle blowing‟ and feedback emails like the „Speak Out‟ continuously decides what actions should be taken by the Committee and the areas where it should improve. No major restructuring has taken place since the time of its inception and Engro Fertilizers continues to evolve as a matrix organization that enjoys the benefits of formal and informal organizational practices. 4. Human resources. All the activities of an organization are significantly influenced by the quality and quantity of its human resources. As discussed above, the Human Resources at Engro, just like all of its subsidiaries are greatly valued and much effort put to improve it. 5. Condition of facilities and equipment. The condition of an organization's facilities and equipment can either enhance or hinder its competitiveness. Internal analysis is difficult and challenging. The checklists provided above can be helpful in determining specific strengths and weaknesses in the functional areas of business.
  • 22. CORPORATE STRATEGY Corporate strategy is based on Engro‟s core competence – Engro is the pioneer of fertilizer in Pakistan, they have a strong Urea business model and to complement it they have built the most efficient and largest single train urea plant in World – Enven, having a capacity of 1.3 mn tonnes and an investment of USD 1.05 bn, by the far the largest private sector industrial investment in Pakistan. Other key strengths of the company include efficient management, company‟s ability to deliver and a strong profitable group of subsidiaries. As the CFO, Naz Khan while commenting on the current debt position of the company said ““Engro Corporation has many subsidiaries, and there is no possibility of a default on payments whatsoever”. As the company continued its growth in other sectors and in fertilizer sector building the most efficient and largest single train urea plant in World – Enven, catching up the capacity in fertilizer that is required by the current and future demand in Pakistan, their direction for future growth is outside Pakistan considering the fact that export of fertilizer is banned in Pakistan. Mr. Ali, Manager Market Analysis & Planning told us that the new direction for the company is to develop an off-shore plant based on the company‟s expertise in fertilizer sector catering to the fertilizer demand in other countries. He said that currently we are on the feasibility stage of our off-shore plant. Besides that he said that an agricultural- led growth strategy is a step in the right direction. Even though the contribution of agriculture sector to the country‟s GDP has declined from 65% in 1990‟s to around 21% at present, it is still a significant contributor to the GDP, employing 44 percent of the workforce.
  • 23. BUSINESS LEVEL STRATEGY Two of Engro Fertilizers Limited core products have been recognized for extraordinary performance in the respective sectors of macronutrients (Engro Urea) and micronutrients (Zingro). Engro Fertilizers Limited is a subsidiary of Engro Corporation Limited (formerly Engro Chemical Pakistan Limited). Engro Urea, the oldest and most trusted brand of high-grade nitrogenous fertilizer in Pakistan, is Engro Fertilizers‟ premier macro nutrient product. Zingro, introduced in 2004, has been developed as a high-grade zinc fertilizer targeting zinc deficiencies in crops such as rice, resulting in greater yield and an improved end-product. This recognition for Engro Urea and Zingro is a testimony to the strength of Engro Fertilizers‟ brands, as well as the strength of the brand teams‟ resolve and hard work put into making Engro a premier brand owner in the fertilizer industry. With this Award, Engro Fertilizers Limited has joined the ranks of several of Pakistan‟s premier brand owners, including the likes of previous winners such as Toyota, TCS, P&G, Standard Chartered, Pizza Hut, Marriot, K&N‟s, Berger Robbialac, Castrol, Bonanza, Dadex, Dunkin Donuts, Head & Shoulders, Ideas, Intel, Inbox, and RoohAfza, among others. The „Brands of the Year Award‟ is the first-of-its-kind hallmark for Brand Recognition in Pakistan, and aim to highlight and encourage the best brands in the Country. It is an annual endeavor, resulting from the joint efforts of The Exhibitor Group, Pakistan Standards and Quality Control Authority (PSQCA) and the Intellectual Property Organization (IPO-Pakistan).The awards have garnered significant international acclaim, and are conducted and duly endorsed by Brands Bureau International Limited London – UK & Brands University.
  • 24. SWOT ANALYSIS OF ENGRO FOODS STRENGTH:- Organizational strength is skills and capabilities that enable an organization to conceive of and implement its strengths. The strength of ENGRO FOODS has strong and well established brands. They are very lucky in this sense they have most experienced sponsors from market. The most important strength of this industry is its proactive management who is operating well and they have also the strong and vast distribution network al over the Pakistan. WEAKNESSESS:- Organization weaknesses skills and capabilities that do not enable an organization to choose and implement strategies that support its mission. The firs and the basic weakness of engro foods that create alarming situation for them that is little experience in FMCG, sector as nestle has been practicing in this sector for the last three decades .They also need significant investment in research and development to make the brands best and from others. They have little experience in powered segment which plant to inter by 2013.engro foods project is unable to fulfill demand of local powder milk product.
  • 25. OPPORTUNITIES:- Organization opportunities are areas those may generate higher performance EF has huge potential in liquid dairy products. They have large and vast system of powered segment and it has the threat for its competitor. It has significant growth potential in North American meat market. THREATS:- Organization threats are areas that increase the difficulty in organizations. The biggest threat for EF is the competitors. Risk of price war in ice cream as walls enjoying higher economics on scales. Nestlé‟s huge investment in powered segment could be a entry barriers. The other important threat for this company is due to high return prospects, other players may also try to enter in this segment.
  • 26. SWOT ANALYSIS OF ENGRO CHEMICALS STRENGTH:- Different strategies call on different skills and capabilities. It has strong performance management. Management parties and principals inherited from EXXON chemical USA after the management buyout in 1991.They are also enjoying the subsidies of gas pricing during the last 10 years. In the result of this subsidy they have strong accumulated reserves low gearing will provide the financial strength in upcoming years. The most golden part of its strength is this that 50% joint ventures, ENGRO vopak has completed 4 years of profitable operations. They have not only a strong customer circle but also have product research. They are also enjoying large market share of engro innovative and chemicals. They also have good reputation in market by strong brand. WEAKNESSES:- Weaknesses is not good for any company‟s strength while engro vopak is performing satisfactory deterioration in operating results of engro SAHI could result in SAHI calling financial support in ECPL. Engro urea doesn‟t command the same market premium as competitors. Fiji fertilizers Sona urea is sold in Punjab province where engro has strong market in Sindh province only,
  • 27. OPPORTUNITIES:- New petrochemical project is helping to improve profitability of engro chemical. Besides this opportunity they have launched the larger segment of value addition chain for reducing business risk through this strategy. They have also had an opportunity to merge with their global business to cope with the competitors. They have potential to innovate and differentiate company‟s product for sustaining a competitive advantages. THREATS:- The main threat and problem that occurs when there is a competitive and technological threats are created.The highlight and major internal factor which will affect the company‟s performance that are size, strength. Cost, revenues and strategy as well as external factors competitive positioning and industry trade. They are also facing the high inflation rate along with low purchasing power. Most of the investors are not investing due to the low rate of interest and the uncertain condition in market. They are also coping with the recessionary period in business cycle. Engro chemical is also facing the increase in sales tax.
  • 28. SWOT ANALYSIS OF ENGRO FERTILIZERS Strength:- The investors, the players, who are operating in this sector, are financially strong and they can start production in new product line. By adding some new unit they can enhance the production capacity of utilization. They have also a well distribution centers and all the companies in this industry have developed a well planned network field, Warehouses to insure that fertilizers are available to the farmer uninterrupted. They also peruse an innovative education oriented advertising policy, utilizing print media and road side advertisement. The major part of strength that all the fertilizer plants are producing at more than 100 percent installed capacity of utilization. WEAKNESES:- They have more weakness than the other sector of engro projects due to the backward in the technology along with low resources. They are facing such troubles like demand is increasing day by day and the capacity of plants to produce fertilizers are getting decrease. Farmers have to pay above than the stated price because of existence of black market and heavy demand. There is another factor that we can‟t deny that the low advertising campaigns.
  • 29. OPPORTUNITIES:- The project of engro, Engro fertilizers is enjoying high benefit from the market and from the government as well. As an agriculture country it has a great support of govt in fertilizer sector. There is no quota restriction by WTO since 2005, so there is more opportunity to export. Availability of gas from Iran can also increase the production for industry and fulfill the demand. THREATS:- Due to uncertain political situation in country govt policies are not consistent regarding fertilizer industry. Unstable political condition is also a big threat for fertilize industry. A natural; gas is main raw material and is supply is also a problem. The fuel price is also increasing due to the fuel crises in the international market. The biggest threat for the engro fertilizer is that imported fertilizers are available at cheap prices than local fertilizers. So, the farmer gives more important rather than the local products.
  • 30.
  • 31. BIBLIOGRAPHY INFORMATION COLLECTED VIA BOOKS Annual repoart Quarterly financial report Invester‟s blog BY READING INTERVIEW OF CEO OF ENGRO President & CEO Engro Corporation INFORMATION COLLECTED VIA INTERNET Encyclopedia Wikipedia Google Engro corporation BY READING NEWS PAPER JUNG & DAWN NEWS PAPER
  • 32. Table of contents Contents page no Introduction…………………………………………………… Engro food……………………………………………………. Engro chemical……………………………………………….. Engro fertilizer…………………………………………….… Award achievement…………………………………………… Environmental analysis……………………………………….. Formulation strategy…………………………………………. Corporate strategy…………………………...……………… Business level strategy……………………….…………….. SWOT analysis…………………………………………..…... Engro food……………………………………………… Engro chemical………………………………………… Engro fertilizer………………………………………. BCG Matrix…………………………………………………. Bibliography …………………………………………………