A holding company is a company that owns part, all, or a majority of other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself, rather its only purpose is owning shares of other companies. Holding companies allow the reduction of risk for the owners and can allow the ownership and control of a number of different companies. Sometimes a company intended to be a pure holding company identifies itself as such by adding "Holdings" or "(Holdings)" to its name, as in Sears Holdings.
There are obviously certain critical advantages , that a Holding company offers to its promoter. At times holding company stands as a parent company for a large conglomerate present in a multiple Industry . This certainly brings some form of focus in the overall strategic moves of the conglomerate which otherwise can loose its focus on the pressure of diversified operation.
So planning for a Holding company was done keeping different situation in mind . Recently , in Indian Banking sector ,it was seen, that two major banking conglomerate SBI and ICICI is looking for the holding companies structure, for the inherent benefit it brings in restructuring the strategic space.
On other cases , planning for a holding company could bring a strong positional advantage in a particular sector or sub sector. It is definite ,that the planning largely depends on the context of the Organizational and industrial environment.
There are obviously certain critical advantages , that a Holding company offers to its promoter. At times holding company stands as a parent company for a large conglomerate present in a multiple Industry . This certainly brings some form of focus in the overall strategic moves of the conglomerate which otherwise can loose its focus on the pressure of diversified operation.
So planning for a Holding company was done keeping different situation in mind . Recently , in Indian Banking sector ,it was seen, that two major banking conglomerate SBI and ICICI is looking for the holding companies structure, for the inherent benefit it brings in restructuring the strategic space.
On other cases , planning for a holding company could bring a strong positional advantage in a particular sector or sub sector. It is definite ,that the planning largely depends on the context of the Organizational and industrial environment.
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