Market Research Report :Motors Market in India 2013

Motors Market IndiaMotors Market – India
July 2013

Executive Summary
Market
Motors find wide application in numerous key sectors of the economy
Robust growth of the end user industries is expected to accelerate the demand for motors in
the Indian market
Drivers &
Challenges
Drivers
 Rise in Infrastructure Investments
 Industrial Growth
 Developments in the Power Sector
Challenges
 Volatile Raw Materials Prices
 Lack of Capacity Utilization
 Consumer Outlook
Challenges  Growth in Consumer Durables
 Agricultural Pumps Demand
 Robust Automotive Market
 Healthy Economic Outlook
Trends Energy Efficient Motors
Customer Services
y
Competition
Major Players
Company A Company B
Company C Company D
2
p y p y
Company E Company F
MOTORS MARKET IN INDIA 2013.PPT

•Macro Economic Indicators
•Introduction
M k t O i•Market Overview
•Motors Demand Scenario
•Motors Manufacturing HubMotors Manufacturing Hub
•Supply Chain Analysis
•Export ‐ Import
•Drivers and Challenges
•Government Initiatives & Regulations
T d•Trends
•Competitive Landscape
•Strategic Initiatives
3
Strategic Initiatives
•Appendix

SAMPLEEconomic Indicators (1/3)
Gross Fiscal Deficit: Monthly
600
500
INR bn
x6
x5
x3500
400
300
200
100
x4
x3
x2
x1
Exchange Rate: Monthly
100
0
Month ‐‐Month ‐‐Month ‐‐Month ‐‐Month ‐‐Month ‐‐
g y
55.0
x2
USD/INR
x1
54.0
54.5 x3 x6
x2
x5
x4
4
53.5
Month 20‐‐Month 20‐‐ Month 20‐‐ Month 20‐‐Month 20‐‐Month 20‐‐

Expansion of the Indian power sector will drive the growth
of the Transmission & Distribution equipment industry
T&D Industry ‐ Overview T&D Market Size
Transmission and distribution industry in India
is heterogeneous and engages in the
INR bn
Z%
x5
production of a wide range of equipment
Electrical Equipment Market Size
x5
x4
x3
x2x1
Sector INR bn ( )
T&D Market Share (20‐‐‐‐)
0
200‐‐‐‐200‐‐‐200‐‐‐‐200‐‐‐‐200‐‐‐
Sector INR bn (‐‐‐)
Boilers x1
Turbines x2
Generators x3
x7
x6
x1 G
F
E
D
C
B
A
Cables x4
Transmission Lines and Conductors x5
Transformers x6
Switchgear & Controlgear x7
x5
4
x2
Switchgear & Controlgear x7
Rotating Machines x8
Energy Meters x9
Capacitors x10
5MOTORS MARKET IN INDIA 2013.PPT
x4
x3
Other Electrical Equipment x11
Total X

AC motors find greater preference for a wide variety of
applications in industrial to domestic sectors
AC Motors ‐ Overview
‘000 KW Segment BSegment A000 KW
x9
a9
x8
a8
x7
a7
x6
a6
x5
a5
x4
a4
x3
a3
x2
a2
x1
a1
Segment BSegment A
b9b8b7b6b5b4b3
b2b1
a1
0
20‐‐e20‐‐e20‐‐e20‐‐e20‐‐e20‐‐20‐‐20‐‐20‐‐
• This segment comprises of A motors and B motors
• It offers the advantages of simple design, reliable operations and easily found replacements
• Segment A motor is the least expensive motor for applications that need more than x HP of power owing to the simple
d i f h
6
design of the motor

SAMPLEMotors Market – Segments (1/2)
Motors Market – Volume Share (1/2)
HT Motors Flame Proof Motors
x1
x4
x3
x2
x2
BA
x1
DCBA
•Total volume of HT Motors in the market is around X
units
•Segment A motors accounted for the majority of the
•Total volume of Flame Proof Motors in the market is
around Y units
•Flame Proof Motors of frame size A accounted for
7
•Segment A motors accounted for the majority of the
market in 20‐‐
•Flame Proof Motors of frame size A accounted for
highest share of the market in 20‐‐

New demand dominates the procurement demand for
motors across the domestic market
Motors Market – Demand Share (20‐‐)
Regional Ranking ‐ Demand Wise
x1
West
x2
Replacement DemandNew Demand Replacement DemandNew Demand
x1
x2
x1
x2
South
& East
North

Supply Chain Analysis (1/2)
Purchase Decision Influencers
A B C D
Motors Market – Share of Sub‐Contracting
•Point 1
x2
•Point 1
•Point 2
•Point 3
x1
9
Segment BSegment A

SAMPLEExports and Imports (Value‐wise) (HS Code – 850110)
Exports
INR bn
Z%
x5x4
0
x1
x5
x3
x2
Imports
20‐‐‐20‐‐‐20‐‐‐200‐‐‐200‐‐‐
INR bn
x5
Z%
x3
x1
x4
x2
0
20‐‐20‐‐‐ 20‐‐‐20‐‐‐ 20‐‐‐

SAMPLEExports and Imports (Country‐wise) (HS Code – ‐‐‐‐‐‐‐‐‐)
Exports (Value) Exports (Volume)
x6 Country 1
x2
x3
x4 Country 1
x1
x5
x4
Country 3
Country 2
Country 5
Country 4
x
x5
x1
Country 5
Country 4
Country 3
Country 2
x3 x2
Country 6 x6 Country 6
Imports (Value) Imports (Volume)
x6
1
Country 2
Country 1 x6
x5
1
Country 2
Country 1
x5
x4
x1
Country 6
Country 5
Country 4
Country 3 x4
x3
x1
Country 6
Country 5
Country 4
Country 3
11
x3 x2 x2

Drivers & Challenges – Summary
Drivers
Rise in Infrastructure Investments
Industrial Growth
Challenges
Developments in the Power Sector
Growth in Consumer Durables
Volatile Raw Material Prices
Lack of Capacity Utilization
Agricultural Pumps Demand
Robust Automotive Market
Consumer Outlook
Healthy Economic Outlook

Rising motors demand owing to rapid industrial growth
plays a key role in the development of motors market
Industrial Growth (1/5)
• Finding 1
 Sub finding 1
Impact
• Finding 2
 Finding 3
Industry – Gross Capital Formation Segment‐wise Industry – Share in GDP Segment‐wise
INR bn
x5
x4
x3
x1
DCBA
x6x5
5
x4
a4
x3
a3
x2
a2
x1
a1
b5
a5
b4
a4
b3
a3
x2
b2
a2
b1
a1
c6
b6
a6
c5
b5
a5
c4
b4
a4
c3
b3
a3
c2
b2
a2
c1
b1
a1
13
0
200‐‐
d5
c5
200‐‐
d4
c4
200‐‐
d3
c3
b3
200‐‐
d2
c2
b2
200‐‐
d1
c1
0
20‐‐e
d6
20‐‐
d5
20‐‐
d4
20‐‐
d3
20‐‐
d2
20‐‐
d1

Motors market is suffering from overcapacity owing to delay
in projects coupled with low capacity utilization
Lack of Capacity Utilization Impact
• Point 1
Motors Production Capacity Utilization
• Point 2
• Point 3
x2
x1
MW
A B
0
x2
T&D Equipment Capacity Utilization Segment‐wise (20‐‐‐)%
54
x3x2x1
20‐‐
0
x9x8x7x6x5x4
x3
14
0
IHGFEDCBA

…order to promote the adoption of energy efficient motors
and reduce energy costs
Focus on Energy Efficiency (2/2)
Motors ‐ Life Cycle Costs
Energy Efficiency Motors Energy Saving Potential
Sector
Conservation
Potential
Energy Handled
by Motors100
%
c1 b3 c3b2 c2b1
A B C
Energy Efficiency Motors ‐ Energy Saving Potential
Sector A x1 y1
Sector B x2 y2y
Sector C x3 y3
a3a2a1
Sector D x4 y4
0
y3y2
kW
y1
Fi di 1
15
yyy
x1 Years x2 Years x3 Years
Finding 1

SAMPLE
Standards governing the motors industry has been revised
from time to time
Motors Industry ‐ ‐‐‐‐
X 1: Performance of Y1 Motors X2 ‐ Performance of Y2 Motors
•Point 1
•Point 2
•Point 3
•Point 1
•Point 2
•Point 3
•Point 1
•Point 2
16
Indian Standard X has been revised and is based on the Z Standard Y

Demonstration of X (1/2)
X Values for Y Specified in Z ‐ Comparison
Point 1
Z
X1 X2 X3 X4 X5
Y1 Y2 Y3 Y4 Y4
‐ ‐ ‐ ‐ ‐ ‐
‐ ‐ ‐ ‐ ‐ ‐
‐ ‐ ‐ ‐ ‐ ‐
‐ ‐ ‐ ‐ ‐ ‐
‐ ‐ ‐ ‐ ‐ ‐

Government focus on increasing the penetration of electric
supply in rural as well as urban localities via various…
Rural Electrification (1/2)
Point 1
Plan A ‐ Xth and Yth Z Plan
• Point 1
• Point 2
• Point 3
Point 1
Point 2
Point 3
18
Note: REC refers to Rural Electrification Corporation Limited
Point 4

Power Transmission Network Expansion – Z Plan
Category A B C D
X1
Segment 1 a1 a2 a3 a4
S 2 b1 b2 b3 b4Segment 2 b1 b2 b3 b4
Segment 3 c1 c2 c3 c4
Segment 4 d1 d2 d3 d4
Segment total E F G H
X2
Segment 1 a1 a2 a3 a4
S t 2 b1 b2 b3 b4Segment 2 b1 b2 b3 b4
X
0
INR bn
a120‐‐ b1 Xc1
A
B
C
19
a120 b1 Xc1 C

Trends – Summary
Energy Efficient
Motors
Customer
ServicesTrends

Motors industry in India is focusing on the adoption of
Energy Efficient (EE) motors …
• Point 1
Energy Efficient Motors (1/3)
Point 1
Factors Driving EE Motors Adoption
X1 X2 X3 X4
P i t 1• Point 1
• Point 2

Competitive Benchmarking (1/5)
Public Trading Comparables (FY 20‐‐)
Company 1 Company 2 Company 3 Company 4
Market Capitalization (INR
mn)
‐ ‐ ‐ ‐
Share Price (INR) ‐ ‐ ‐ ‐
EV/EBITDA (x) ‐ ‐ ‐ ‐
/EV/Revenue (x) ‐ ‐ ‐ ‐
PE Ratio ‐ ‐ ‐ ‐

Public: Domestic Company – Company A (1/4)
Company Information Offices and Centres – India
Corporate Address
Address
Tel No. 91 ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐Tel No. 91
Fax No. 91 ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Website website
Year of Incorporation 19‐‐
Products and Services
Ticker Symbol ‐‐‐‐‐‐
Stock Exchange ‐‐‐
Key People
Products and Services
Category Products/Services
Segment Product 1, product 2, product
N D i ti
Head Office
3,………………….
Others Product 1, product 2, product 3………
Name Designation
Person 1 Designation
23
, p , p

i i l S h K i
Public: Domestic Company – Company A (2/4)
Financial Snapshot Key Ratios
Particulars
y‐o‐y change
(20‐‐‐)
20‐‐ 20‐‐ 20‐‐ 20‐‐
Profitability Ratios
Operating Margin 0.36 4.05% 3.69% 3.48% 9.67%
Net Profit/LossTotal Income
60000
80000
3 000
4,000
y3 y4
INR mn INR mn
y1
y2
Net Margin ‐0.61 1.85% 2.47% 1.00% 5.64%
Profit Before Tax Margin ‐0.80 2.78% 3.58% 1.58% 8.39%
Return on Equity ‐1.86 5.42% 7.28% 2.61% 14.63%
Return on Capital Employed 0.95 11.82% 10.87% 9.11% 25.10%
Return on Working Capital 5.21 31.23% 26.02% 13.98% 37.62%
Return on Assets 0.37 4.75% 4.38% 3.82% 10.95%
0
20000
40000
60000
0
1,000
2,000
3,000
x3 x4
20‐‐ 20‐‐
x1 x2
20‐‐ 20‐‐
Financial Summary
• The company earned a net profit of INR x mn in FY 20‐‐, as
compared to net profit of INR y mn in FY 20‐‐
• The company reported total income of INR y mn in FY 20‐‐,
registering an increase of % over FY 20
Return on Fixed Assets 0.78 25.83% 25.05% 27.79% 78.13%
Cost Ratios
Operating costs (% of Sales) ‐0.34 95.94% 96.29% 96.51% 90.30%
Administration costs (% of
Sales)
0.56 15.73% 15.17% 13.30% 11.86%
Interest costs (% of Sales) 0 11 0 49% 0 38% 0 27% 0 41%registering an increase of z% over FY 20‐‐
• The company earned an operating margin of y1 % in FY 20‐‐, an
increase of x2 percentage points over FY 20‐‐
• The company reported debt to equity ratio of z1 in FY 20‐‐
Interest costs (% of Sales) 0.11 0.49% 0.38% 0.27% 0.41%
Liquidity Ratios
Current Ratio ‐2.18% 1.25 1.28 1.47 1.52
Cash Ratio ‐63.75% 0.03 0.07 0.18 0.17
Leverage Ratios
Debt to Equity Ratio ‐ 0.13 0.00 0.00 0.00
Key Financial Performance Indicators
Indicators Value (dd/mm/yyyy)
Market Capitalization (INR mn) ‐
Total Enterprise Value (INR mn) ‐
EPS (INR) (21/3/2013)
Debt to Capital Ratio ‐ 0.11 0.00 0.00 0.00
Interest Coverage Ratio ‐16.15% 8.22 9.80 12.69 23.75
Efficiency Ratios
Fixed Asset Turnover ‐5.59% 6.37 6.74 7.97 8.05
Asset Turnover ‐0.78% 1.17 1.18 1.10 1.13
Current Asset Turnover 1 19% 1 56 1 54 1 29 1 32
24
EPS (INR) (21/3/2013) ‐
PE Ratio (Absolute) (21/3/2013) ‐
Current Asset Turnover 1.19% 1.56 1.54 1.29 1.32
Working Capital Turnover 9.86% 7.70 7.01 4.01 3.88
Capital Employed Turnover 12.00% 2.93 2.61 2.94 2.28
Improved Decline

Public: Domestic Company – Company A(3/4)
Key Business Segments Key Geographic Segments
100%
CEBDA
100%
BA
0%
50%
100%
d1
c1
b1
a1
e4
d4
c4
b4
a4
e3
d3
c3
b3
a3
e2
d2
c2
b2
a2
e1 0%
50%
y4
x4
y3
x3
y2
x2
y1
x1
Business Highlights
%
20‐‐20‐‐20‐‐20‐‐
0%
20‐‐20‐‐20‐‐
y
20‐‐
y
Description News
Overview
• Company A operates in the field of X and caters to the utility and the industrial end user
segments
• Manufacturing and production activities of the company are divided into x global divisions• Manufacturing and production activities of the company are divided into x global divisions
viz. a1, a2, a3 , a4 and a5
Manufacturing Facilities
• Operations network of the company includes x1 manufacturing facilities, more than x2
marketing offices x3 service centers x4 logistics warehouses x5 Power & Automation
25
and Network
marketing offices, x3 service centers, x4 logistics warehouses, x5 Power & Automation
Engineering Centers and a network of over x6 channel partners

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Market Research Report :Motors Market in India 2013

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Market Research Report :Motors Market in India 2013