case study

1. Case 1
The relationship between Italian automotive major Fiat SpA and India’s Tata Motors to tap the Indian market
with a distribution and service alliance in 2005. This later went on to become a 50:50 industrial Joint Venture
Fiat India Automobiles Limited) in 2007. Both the companies agreed to a joint distribution network, a back-e
support system, and co-manufacturing of products including engine and technology sharing at Fiat’s facility a
Ranjangaon in Maharashtra.
While the industrial JV was yet to break even by 2012, the distribution arrangement too failed to live up to
expectations and both Fiat and Tata Motors suffered losses. After witnessing a fall in the sales of Fiat branded
and accumulating huge losses in the JV, Fiat announced that it would exit the joint-branded dealership agreem
with Tata Motors. The company decided to go it alone after it sensed the step-motherly treatment faced by
prospective Fiat car buyers at the Tata-Fiat showrooms. However, the break up of the JV was only at the deal
level.
1. What type of business restructuring is the above case based on? Please define the type in detail. (3 m
2. What were the reasons for which this restructuring to take place? (4 marks)
3. When and why did this not work? And which company decided to go separate? (3 marks)
4. What is your opinion about Fiats decision to go ahead alone? (3 marks)
Case 2
This case is about the split between the Hero Group and Honda Motor Company. Hero Honda Motors Ltd. (H
Honda), a joint venture between Hero Cycles of India and Honda of Japan, came into existence in 1984 as a
motorcycle and scooter manufacturer in India. In 2001, Hero Honda became the largest two wheeler manufact
company in India with over a million units produced as well as the 'World's number one' company in terms of
unit volume sales for the calendar year. The technology for manufacturing the bikes was provided by Honda w
Hero was strong in its distribution and service network spread across the country. In August 1999, Honda Mo
Company announced the setting up of Honda Motorcycle and Scooter India (HMSI) for making scooters and
motorcycles as well. After this, the stock of Hero Honda fell by 30%. Subsequently, HMSI started producing
motorcycles, competing directly with Hero Honda. Hero felt that its ambition to go international was being ha
by the joint venture. Both the companies decided to end the joint venture and signed their parting agreement o
December 16, 2010. With the split, the erstwhile partners became competitors. Both the companies have seve
opportunities ahead of them and are likely to face challenges to gain and consolidate their position in the India
wheeler market.
1. What are the benefits and problems of both companies? (4 marks)
2. Discuss whether the decision of both companies to split Hero Honda was correct. (5 marks)
3. Analyze the impact of this split on consumers and competitors.(4 Marks)
Case 3

2. stock exchange or bourse is an exchange where stock brokers and traders can buy and/or sell stocks (also ca
shares), bonds, and other securities. Stock exchanges may also provide facilities for issue and redemption of
securities and other financial instruments, and capital events including the payment of income and dividends.
Securities traded on a stock exchange include stock issued by listed companies, unit trusts, derivatives, pooled
investment products and bonds. Stock exchanges often function as "continuous auction" markets, with buyers
sellers consummating transactions at a central location, such as the floor of the exchange.[2]
To be able to trade a security on a certain stock exchange, it must be listed there. Usually, there is a central lo
at least for record keeping, but trade is increasingly less linked to such a physical place, as modern markets us
electronic networks, which gives them advantages of increased speed and reduced cost of transactions. Trade
exchange is restricted to brokers who are members of the exchange. In recent years, various other trading ven
such as electronic communication networks, alternative trading systems and "dark pools" have taken much of
trading activity away from traditional stock exchanges.[3]
The initial public offering of stocks and bonds to investors is by definition done in the primary market and
subsequent trading is done in the secondary market. A stock exchange is often the most important component
stock market. Supply and demand in stock markets are driven by various factors that, as in all free markets, af
price of stocks (see stock valuation).
There is usually no obligation for stock to be issued via the stock exchange itself, nor must stock be subseque
traded on the exchange. Such trading may be off exchange or over-the-counter. This is the usual way that deri
and bonds are traded. Increasingly, stock exchanges are part of a global securities market.

3. Table 1
Rank Exchange Economy
1 NewYork Stock Exchange UnitedStates
2 NASDAQ UnitedStates
3[6]
LondonStock Exchange Group
UnitedKingdom
Italy
4 JapanExchange Group – Tokyo Japan
5 Shanghai StockExchange China
6 Hong KongStock Exchange Hong Kong
7 Euronext EuropeanUnion
8 ShenzhenStockExchange China
9 TMX Group Canada
10 Deutsche Börse Germany
11 BombayStock Exchange India
12 National StockExchange of India India
13 SIXSwissExchange Switzerland
14 AustralianSecuritiesExchange Australia
15 KoreaExchange SouthKorea
16 OMX NordicExchange
NorthernEurope,
Armenia
17 JSE Limited SouthAfrica
18 BME SpanishExchanges Spain
19 TaiwanStock Exchange Taiwan
20 BM&F Bovespa Brazil

4. Major stock exchanges
Major stock exchanges (top 20 by market capitalization) of issued shares of domestic companies, as of 3
January 2015 (Monthly reports, World Federation of Exchanges)
Rank Exchange Economy
Head-
quarters
Market
cap
(USD bn)
Monthly
trade
volume
(USD bn)
Time zone Δ DST
Open
(local)
Close
(local)
Lunch
(local)
Ope
(UT
1
NewYork
Stock
Exchange
United
States
NewYork 19,223 1,520 EST/EDT −5
Mar–
Nov
09:30 16:00 No 14:
2 NASDAQ
United
States
NewYork 6,831 1,183 EST/EDT −5
Mar–
Nov
09:30 16:00 No 14:
3[6]
London
Stock
Exchange
Group
United
Kingdom
Italy
London 6,187 165 GMT/BST +0
Mar–
Oct
08:00 16:30 No 08:
4
Japan
Exchange
Group –
Tokyo
Japan Tokyo 4,485 402 JST +9 09:00 15:00
11:30–
12:30
00:

5. 5
Shanghai
Stock
Exchange
China Shanghai 3,986 1,278 CST +8 09:30 15:00
11:30–
13:00
01:
6
Hong
Kong
Stock
Exchange
Hong
Kong
Hong Kong 3,325 155 HKT +8 09:15 16:00
12:00–
13:00
01:
7 Euronext European
Union
Amsterdam
Brussels
Lisbon
London
Paris
3,321 184 CET/CEST +1
Mar–
Oct
09:00 17:30 No 08:
8
Shenzhen
Stock
Exchange
China Shenzhen 2,285 800 CST +8 09:30 15:00
11:30–
13:00
01:
9
TMX
Group
Canada Toronto 1,939 120 EST/EDT −5
Mar–
Nov
09:30 16:00 No 14:
10
Deutsche
Börse Germany Frankfurt 1,762 142 CET/CEST +1
Mar–
Oct
08:00
(Eurex)
08:00
(floor)
09:00
(Xetra)
22:00
(Eurex)
20:00
(floor)
17:30
(Xetra)
No 07:
11
Bombay
Stock
Exchange
India Mumbai 1,682 11.8 IST +5.5 09:15 15:30 No 03:
12
National
Stock
Exchange
of India
India Mumbai 1,642 62.2 IST +5.5 09:15 15:30 No 03:
13
SIXSwiss
Exchange Switzerland
Zurich 1,516 126 CET/CEST +1
Mar–
Oct
09:00 17:30 No 08:
14
Australian
Securities
Exchange
Australia Sydney 1,272 55.8 AEST/AEDT +10
Oct–
Apr
09:50 16:12 No 23:

6. 15
Korea
Exchange
South
Korea
Seoul 1,251 136 KST +9 09:00 15:00 No 00:
16
OMX
Nordic
Exchange
Northern
Europe,
Armenia
Stockholm 1,212 63.2 various
17
JSE
Limited
South
Africa
Johannesburg 951 27.6 CAT +2 09:00 17:00 No 07:
18
BME
Spanish
Exchanges
Spain Madrid 942 94.0 CET/CEST +1
Mar–
Oct
09:00 17:30 No 08:
19
Taiwan
Stock
Exchange
Taiwan Taipei 861 54.3 CST +8 09:00 13:30 No 01:
20
BM&F
Bovespa
Brazil São Paulo 824 51.1 BRT/BRST −3
Oct–
Feb
10:00 17:30 No 13: