Costing in Pepe Denim
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Code : FAC0054
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Region : India
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Introduction:Kesar Bajaj (Bajaj), chairman of Pepe Denim, a manufacturer and retailer of jeans in India, was facing tremendous pressure to improve the financial position of the company and its market valuation. Bajaj and his younger brother Dinkar had floated Pepe Denim as a private limited company in Ahmedabad, Gujarat, in 1984. In 1994, the brothers decided to convert the company into a public limited company. Pepe Denim began manufacturing operations with just one factory in Ahmedabad district but the brothers put in a lot of hard work and took the company to a level where in 2011, it had 300 stores spread throughout the country and a workforce of 20,000. It also used to export its jeans to China, Brazil, and Nepal. Till 2007, the company did very good business with its sales increasing every year. It earned exceptional growth in valuation resulting from an increase in the company's stock prices. After 2007, however, the stock prices of the company started to decline even though sales continued to be consistent. Though there was no decrease in sales, the profits began to fall. The brothers thought that the decline in the stock prices and profits was due to the economic slowdown and recession. |
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