Is a Fresh Lease of Life at HMT`s Praga Possible?

Case Code: BSTR694
Case Length: 8 Pages
Period: -
Pub Date: 2025
Teaching Note: Available

Price: Rs.300
Organization : Praga Tools Limited
Industry : Industrial Goods & Machinery
Countries : India
Themes: Turnaround Strategy, Five Forces Strategic Planning,Brand Revival

Abstract Case Intro 1 Case Intro 2 Excerpts

Excerpts

The Merger

In 2005, HMTMTL was declared a sick unit under the provisions of the Sick Industrial Companies (Special Provisions) Act, 1985, due to significant accumulated losses and complete erosion of its tangible net worth. In December 2005, the company was referred to the Board of Industrial and Financial Reconstruction (BIFR) for suitable rehabilitation measures to be determined. BIFR subsequently approved a rehabilitation package, which included financial sanctions, waivers, and exemptions from various government agencies and banks..

Troubled Times

However, the post-merger realities presented a different picture. Despite the merger, the Praga unit struggled with outdated technology, financial constraints, and declining employee morale driven by stagnant wages and limited participation in decision-making processes..

The Road Ahead

The global machine tools market was projected to grow at a CAGR of 5.5% from 2021 to 2028, to reach a value of USD 164.92 billion by 2028. The machine tools industry was also being disrupted by new technologies, such as Artificial Intelligence (AI) and the Internet of Things (IoT) . These technologies were being used to develop smarter, more connected machine tools that operated more efficiently and autonomously..

Exhibits

Exhibit I: Corporate Structure of HMT
Exhibit II: HMT Machines Products Range

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