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1. Sanitaryware Market –
Sanitaryware Market India
October 2013

2. Executive Summary
Market
 Indian sanitaryware market is expected to reach INR ‘h’ mn in 20‐‐e, growing at a CAGR of ‘x’%, from INR ‘a’ mn in
20‐‐
 Unorganized sector accounts for ~’z’% of the sanitaryware market in terms of volume
Drivers &
Challenges
Drivers:
• High Income and Changing Lifestyle
• Real Estate Boom
• Replacement Demand
• Untapped Market Potential
• Increasing Awareness Among Consumers
Challenges:
• Rise in Power and Fuel Costs
• Large Unorganized Sector
• Seasonality
Government
Initiatives
 Total Sanitation Campaign & 12th Five Year Plan (2012‐17)
 Public Toilet Schemes
 Housing Policies
 100% FDI in Real Estate
Trends
 Premium Sanitaryware Segment
 Increasing Foreign Presence
 Emergence of Concept Washrooms
 Green Initiatives
Major Brands
Competition
Company 1
Company 2
SANITARYWARE MARKET IN INDIA 2013.PPT
Company 3
Company 4
2

3. •Economic Indicators
•Introduction
•Market Overview
•Sanitation Facilities
•Export‐Import
•Drivers & Challenges
•Government Initiatives
•Trends
•Competitive Landscape
•Strategic Recommendations
•Appendix
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4. Economic Indicators (1/3)
GDP at Factor Cost: Quarterly
INR tn
14
a1
b1
12
c1
a2
b2
c2
11
d1
b4
c4
b3
d2
13
c3
d4
d3
10
Q1
Q2
2009‐10
2010‐11
Q3
2012‐13
2011‐12
Q4
Inflation Rate: Monthly
y
%
1.0
a
c
0.8
0.6
b
d
e
Feb 2013 ‐ Mar 2013
Mar 2013 ‐ Apr 2013
0.4
0.2
0.0
Nov 2012 ‐ Dec 2012
Dec 2012 ‐ Jan 2013
Jan 2013 ‐ Feb 2013
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5. Sanitaryware refers to the various plumbing fixtures such as
sinks or…
Sanitaryware Products (1/2)
Sinks
Types
Materials Used
Type 1 sinks, Type 2 sinks, Type 3 sinks, Type 4 sinks,
Type 5 sinks, sinks fitted on Type A / Type B / Type C
cabinets
Type 1, Type 2, Type 3, Type 4, Type 5, Type 6,
Type 7, Type 8, Type 9, Type 10
Sinks can be placed on countertops which are made of marble or onyx, and have rugged water proof surfaces
Moreover, sinks are in trend as they help to improve a bathroom's efficiency
Shapes
Designer
Ware Sinks
Shape 1
Shape 2
Handcrafted sinks in
glass, metal and
ceramic
Shape 3
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6. Government target to provide adequate sanitation within
next 5 years will ensure sustained growth in the market
Sanitaryware Market – Overview
• Indian sanitaryware market accounts for ‘y’% of the global sanitaryware production and ranks ‘n’th in terms
of volume within the Region A
• Improved living standards and increasing awareness level among the consumers have resulted in rapid
growth of the sanitaryware market
Market Size and Growth (Value‐Wise)
INR mn
50,000
h
40,000
30,000
g
x%
d
f
20,000
a
b
c
10,000
0
20‐‐
20‐‐
20‐‐
20‐‐e
20‐‐e
SANITARYWARE MARKET IN INDIA 2013.PPT
20‐‐e
20‐‐e
6

7. As of 2011, more than 50% of the total households in nine
states were devoid of basic latrine facilities
Basic Amenities Scenario – Latrine Facility (2011) – (1/3)
Percentage of households having
State / Union Territory
Total Households
(‘000)
Water Closet
(%)
Pit Latrines
(%)
Other Latrines
(%)
No Latrine
(%)
State 1
State 2
State 2
State 3
State 4
State 5
State 6
State 7
State 8
State 9
State 10
State 11
Top 5 states in India in terms of minimum availability of latrine facilities in 2011
SANITARYWARE MARKET IN INDIA 2013.PPT
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8. India has been witnessing a trade deficit over the past two
years…
Exports
Exports (Value and Volume)
• Indian sanitaryware exports declined by a CAGR of
‘z’% in value terms between FY 20‐‐ and FY 20‐‐
• This could be associated with the high value of export
in FY 20‐‐ as in the following 3 years the value of
exports has been around INR ~’q’ mn
• While Country 1 has been the largest export market
for sanitaryware in terms of value in FY 20‐‐, the
largest export market for sanitaryware in terms of
volume for the same period was Country 3
Value
INR mn
INR mn
300
n2
l1
m1
p1
0
20‐‐
20‐‐
20‐‐
Country 3
a2%
i2%
Country 2
Country 1
Country 1
Country 4
b1%
Country 4
Country 5
Country 6
f1%
d1%
Country 7
Country 7
c1%
500
20‐‐
Country 3
Country 3
g1%
1,000
Region‐Wise Exports – Volume
(20‐‐)
Country 2
h1%
1,500
0
Country 1
i1%
p2
n1
m2
200
Region‐Wise Exports – Value
(20‐‐)
a1%
‘000 Kg
000 Kg
‐z%
l2
100
Volume
b2%
h2%
Country 8
g2%
f2%
d2%
Others
Country 5
c2%
Country 9
Country 9
Others
Note: HS Code 74182010 – Sanitaryware
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9. Drivers & Challenges – Summary
Drivers
Challenges
g
High Income and Changing Lifestyle
Rise in Power and Fuel Costs
Real Estate Boom
Large Unorganized Sector
Replacement Demand
Seasonality
Untapped Market Potential
Increasing Awareness Among
Increasing Awareness Among
Consumers
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10. Government Initiatives – Summary
Impact
Total Sanitation Campaign &
p g
12th Five Year Plan (2012‐17)
Public Toilet Schemes
Housing Policies (Urban)
100% FDI in Real Estate
100% FDI in Real Estate
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11. Trends – Summary
Premium Sanitaryware
Segment
Green Initiatives
Key Trends
Emergence of
Concept Washrooms
Increasing
Foreign Presence
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12. Competitive Benchmarking – Public Companies (1/5)
Key Ratios of Major Public Companies – Operational Basis (FY 2013) (1/3)
Gross Margin
%
50
Operating Margin
Net Margin
a2
a1
40
a3
30
20
10
b1
b2
c1
c2
b3
c3
3
0
Company 1
Company 2
Company 3
• Company 2 recorded gross margin of ‘a2’%, higher than that of both Company 1 and Company 3 which recorded gross
p y
g
g
, g
p y
p y
g
margin of ‘a1’% and ‘a3’% respectively
• Company 1 recorded operating margin of ‘b1’% which was lower than that of Company 2 which recorded operating
margin of ‘b2’%, but higher than that of Company 3 which recorded operating margin of ‘b3’%
• Company 2 recorded a higher net margin of ‘c2’% compared to Company 1 and Company 3 which recorded a net
margin of c1 % and c3 % respectively
margin of ‘c1’% and ‘c3’% respectively
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13. Competition Curve – Public Companies
INR mn
15,000
FY 20‐‐
Total Income
Net Profit/Loss
a1
10,000
c1
5,000
5 000
a2
b1
b
0
Company 1
b2
Company 2
c2
Company 3
INR mn
15,000
FY 20‐‐
Total Income
l1
Net Profit/Loss
n1
10,000
5,000
l2
m1
0
Company 1
INR mn
20,000
FY 20‐‐
Company 2
Total Income
p1
m2
n2
Company 3
Net Profit/Loss
r1
10,000
q1
p
p2
q2
0
Company 1
Company 2
SANITARYWARE MARKET IN INDIA 2013.PPT
r2
Company 3
13

14. Public: Domestic Company – Company 1
(1/5)
Company Information
Offices and Centres – India
Corporate Address
Tel No.
Gurgaon
Fax No.
Website
Year of Incorporation
Ticker Symbol
Stock Exchange
Head Office
Products
Sanitaryware
Products
Key People
Name
N
Designation
D i ti
Person 1
Executive & Non‐Independent Chairman
Person 2
Joint MD
Person 3
Deputy General Manager of Finance
Person 4
Assistant VP
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15. Public: Domestic Company – Company 1
(2/5)
Financial Snapshot
i
i lS
h
Total Income
INR mn
Key Ratios
K
i
Net Profit / Loss
INR mn
c2
20,000
d2
b2
800
15,000
15 000
10,000
5,000
1,000
a2
a1
b1
600
400
d1
c1
200
0
0
20‐‐
20‐‐
20‐‐
20‐‐
Financial Summary
• Company earned a net profit of INR XX mn in FY 20XX, as compared to net
profit of INR Y mn in FY 20YY
• It reported total Income of INR XX mn in FY 20XX, registering an increase
of X per cent over FY 20YY
of X per cent over FY 20YY
• It earned an operating margin of X.X per cent in FY 20XX an increase of X.X
percentage points over FY 20YY
• The company reported debt to equity ratio of X.XX in FY 20XX, an increase
of X.X per cent over FY 20YY
Market Capitalization (INR mn)
Total Enterprise Value (INR mn)
EPS (INR)
( )
PE Ratio (Abs)
y‐o‐y change
2013
(2013‐12)
2012
2011
2010
Profitability Ratios
Operating Margin
Net Margin
Profit Before Tax Margin
Return on Equity
Return on Capital Employed
Return on Working Capital
Return on Assets
Return on Fixed Assets
Cost Ratios
Operating costs (% of Sales)
Administration costs (% of
Sales)
Interest costs (% of Sales)
Interest costs (% of Sales)
Liquidity Ratios
Current Ratio
Cash Ratio
Leverage Ratios
Debt to Equity Ratio
Debt to Capital Ratio
Interest Coverage Ratio
Key Financial Performance Indicators
Indicators
Particulars
Value (dd/mm/yyyy)
Efficiency Ratios
Fixed Asset Turnover
Asset Turnover
Current Asset Turnover
Current Asset Turnover
Working Capital Turnover
Capital Employed Turnover
Improved
SANITARYWARE MARKET IN INDIA 2013.PPT
Decline
15

16. Public: Domestic Company – Company 1
(3/5)
Key Business Segments
Segment 1
Key Geographic Segments
Segment 2
Segment 3
India
100%
80%
a1%
1%
b1%
c1%
1%
d1%
a2%
b2%
c2%
d2%
a3%
b3%
c3%
d3%
20‐‐
20‐‐
20‐‐
100%
20‐‐
60%
40%
20%
0%
50%
100%
India is the only geographic
India is the only geographic
segment in which the company
has been operating for the last
four years
0%
20‐‐
Business Highlights (1/2)
Description
Overview
Network
Other Products
Realizations
News
• It is a flagship company of the ‘A’ Group and is the largest Indian manufacturer of
sanitaryware products with a dominant market share of ‘x’% of the organized sector
• Company has achieved ‘y’% level of capacity utilization in sanitaryware
• Company offers its sanitaryware under the brands: Brand 1, Brand 2, Brand 3 and Brand 4
p y
y
,
,
 Besides, it has also launched the world’s premium brands Brand 5 and Brand 6 in the Indian market
• Company has a wide spread network of more than 15,000 retailers and 2,000 + dealers
• There are 18 service centers across India and more than 458+ shop‐in‐shop
• Faucets, Wellness Products, Kitchen appliances, Tiles, Container Glass and PET Bottles and
Extractor Fans
Extractor Fans
• Achieved 8.26% higher average realizations per tonne in the sanitaryware segment
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17. Public: Domestic Company – Company 1
(4/5)
Business Highlights (2/2)
Description
News
Installed Capacity
• Sanitaryware Products:
 City 1 with installed capacity of 1.5 mn pieces annually
h
ll d
f
ll
 City 2 with installed capacity of 2 mn pieces annually
• Faucets:
 City 3 with installed capacity of 0.5 mn pieces annually
Capacity Expansion
• Company has achieved ‘z’% increment in sanitaryware capacity along with increasing the
p y
%
y
p y
g
g
faucets capacity by 10 times
• Company has successfully completed the expansion of 0.7 mn pieces of sanitaryware at
the plant in City 2 by Sep 2011, taking its capacity to 2 mn pieces within a budgeted cost
of INR 600 mn
Product Launches
• During 2011‐12, company has launched 25 new sanitaryware products under Brand 1 and
two series of faucets under the Brand 2
• Company has forayed into the ultra‐premium market segment by launching 8 new series
of high‐end luxury sanitaryware and faucets under the Brand 5, which is a part of the
brand portfolio of their Region A based wholly owned subsidiary
brand portfolio of their Region ‘A’ based wholly owned subsidiary
Expansion Plans
• Company has plans of greenfield expansion of 1.2 mn pieces of sanitaryware and 2.5 mn
pieces of faucets in State 1 and State 2, respectively
 In State 1, company plans to invest INR 1,700 mn and slowly scale up investments up to INR 5,000 mn
SANITARYWARE MARKET IN INDIA 2013.PPT
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18. Public: Domestic Company – Company 1 – SWOT Analysis
(5/5)
SAMPLE
S
W
O
T
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19. Thank you for the attention
Sanitaryware Market – India report is part of Netscribes’ Manufacturing & Construction
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