market research report : construction equipment market in india 2012
TRANSCRIPT
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Construction Equipment Market – India
December 2012
2CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Executive Summary
Market Huge investment in infrastructure construction presents a major growth opportunity to the Indian construction equipment market
Drivers & Challenges
Competition
DriversRobust Economic Development
Growth in Infrastructure
Expansion in Mining Sector
Growing presence of OEM in India
FDI Inflow in Construction
Challenges Land Acquisition Problems
Project Bottlenecks
Crude Oil Price Hike
Rising Steel Prices
Lack of Skilled Labour
Major Players
Company 1 Company 2 Company 3
Company 4 Company 5 Company 6
Focus on Technology
Aggressive Expansion Plans
Technical Collaborations Trends
Government Initiatives
Manufacturing Sector Policies
Upcoming Regulations
Required Initiatives
Decline in Import Share
Growth in After Sales Service
Environment Concerns
3CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
•Market Overview Global
India
•Construction Equipment Segments
•Sector wise Demand
•Drivers and Challenges
•Government Initiatives
•Trends
•Opportunity Areas
•Recent Developments
•Competition
•Strategic Recommendations
•Appendix
4CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Focus on infrastructure development offers strong growth potential to the Indian construction equipment market
Construction Equipment Market India – Overview
• Indian construction equipment market is one of the fastest growing markets in the world
• Construction constitutes the second largest sector in the Indian economy
• Low infrastructure and consequently heavy investments in infrastructure in the 12th five year plan presents tremendous opportunity for growth to the Indian market
• Indian market is characterized by the dominance of foreign players alone or in partnership with Indian manufacturers of construction equipments
Construction Equipment Market
0
100
200
300
400
500
INR bn
Z%
20‐‐e
x7
20‐‐e
x6
20‐‐e
x5
20‐‐e
x4
20‐‐e
x3
20‐‐
x2
20‐‐
x1
5CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Earth Moving Equipment – Equipment 1
Equipment 1 Sales Equipment 1 – Market Share
• Point 1
• Point 2
Market Overview
Major Players
Company 1
Company 2
Company 3
X%
Z%
Y%
Company 2Company 1 Others
0
10,000
20,000
30,000
40,000Z%
20‐‐e
x7
20‐‐e
x6
20‐‐e
x5
20‐‐e
x4
20‐‐e
x3
20‐‐
x2
20‐‐
x1
units
6CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Rental Equipment Market
•Market Overview•Penetration•Drivers•Challenges•Trends•Scenario
7CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Capital constraints and strict project timelines are promoting the demand for rental equipments
• Rental equipment market in India is still at its nascent stage
• Equipment rental market is expected to reach INR x bn in 20‐‐ with a CAGR of x% over 20‐‐‐
• Rental market in India is highly fragmented with the organised sector accounting for x% of the market
• Share of top y companies added to a bare minimum of z units in 20‐‐
Equipment Rental Market ‐ Overview Equipment Rental Market Growth
Rental Equipment Market Segments (20‐‐)
y%
X%
A B
Equipment Rental Market Share – (20‐‐)
x%
y%
X Y
0
50
100
150
20‐‐ 20‐‐e20‐‐e 20‐‐e
x3x2
x5
20‐‐e20‐‐
INR bn
x6
20‐‐e
x1
x4
x7Y%
8CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Equipment Financing Market
•Market Overview•Major Features•Major Finance Providers•Finance Types•Drivers•Challenges•Role of NBFCs
9CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Rise in construction activities presents a huge opportunity for growth to the equipment financing market
• Construction equipment financing market in India is still at its nascent stage
• Equipment financing market has a great growth potential owing to high construction activities leading to high demand for equipments
Equipment Financing Market ‐ Overview
Equipment Financing Market Growth
Equipment Financing – Market Share
0
10
20
30
40
50
60
70
80
90
100
%
20‐‐
k2
j2i2 h2g2
f2e2d2
c2
b2
a2
20‐‐
k1
j1i1h1
g1f1
e1
d1
c1
b1
a1
Others
Company 10
Company 9
Company 8
Company 7
Company 6
Company 5
Company 4
Company 3
Company 2
Company 1
0
100
200
300
400
500
600
700
INR bn
Z%
20‐‐e
x6
20‐‐e
x5
20‐‐e
x4
20‐‐e
x3
20‐‐e
x2
20‐‐
x1
10CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Infrastructure
Roads Railway Ports
Airports Irrigation Urban Development
Power Transmission Storage Telecom
Sector Wise Demand
11CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Construction Equipment – Infrastructure Demand
•Finding 1•Finding 2
•Finding 3•Finding 4
Construction Equipment –Share of Expenditure
Planned Investment in RoadsX Status
Roads ‐ Overview
x%‐y%Construction EquipmentCosts Share
0
1,000
2,000
3,000
4,000
C
R
z3
y3
x3
B
Q
z2
y2
x2
A
P
z1y1
x1
INR bnZYX
0 10,000 20,000 30,000 40,000 50,000
kms
Xx1 x2 x3
A B C
12CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Drivers & Challenges – Summary
Drivers
Robust Economic Development
Growth in Infrastructure
Expansion in Mining Sector
Growing Presence of OEM in India
FDI Inflow in Construction
Challenges
Land Acquisition Problems
Project Bottlenecks
Crude Oil Price Hike
Rising Steel Prices
Lack of Skilled Labour
13CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Foreign direct investment in construction industry and construction equipments will ensure market growth
FDI Inflow in Construction Industry Impact
• Finding 1
• Finding 2
• Finding 3
• Finding 1
• Finding 2
• Finding 3
FDI in Construction Activities
FDI in Earthmoving Equipments
Construction Activities‐ FDI
Earthmoving Equipments ‐ FDI
0
50
100
150
INR bnZ%
20‐‐
x3
20‐‐
x2
220‐‐
x1
0
2
4
6
8x1
20‐‐
x2
INR bn Z%
20‐‐
x3
20‐‐
14CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Lack of some key initiatives are hampering the development of the Indian construction equipment market
RequiredInitiatives
Initiative 1
Initiative 3
Initiative 5
Initiative 2
Initiative 4
15CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
`
Focus on Technology
Aggressive Expansion Plans
Environment Concerns
Growth in After Sales Service
Technical Collaborations
Trends – Summary
Key Trends
Decline in Import Share
16CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Players in the market are focusing on application of latest technologies
Automation of construction
equipment gaining popularity
• Finding 1
• Finding 2
Technology Launches
• Point 1
• Point 2
• Point 3
• Point 1
• Point 2
• Point 3
Technology 1 Technology 2
Focus on Technology (1/2)
17CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Opportunity Areas
State 1 State 2 State 3 State 4
Indian states are focusing on infrastructure development as the primary vehicle to drive economic growthEmphasis on construction of infrastructure facilities provides a huge scope for the development of
construction equipment market in India
18CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
State A – Opportunity Areas (2/3)
State A – Infrastructure Investment
•Point 1
•Point 2
•Point 3
•Point 4
•Point 5
•Point 6
State A ‐ Real GDP Growth Rate
Investment in Infrastructure (20‐‐‐‐)
x4
x2
x3
x5
x6x7
x1
E
D
C
B
G
F
A
0
5
10
15
x2
x3
20‐‐
y2
20‐‐
y1x1 x4
20‐‐
y4
%
20‐‐
y3
Country 1State A
19CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Public: Domestic Company – Company 1 (1/3)
Key People
Products and Services
Company Information Offices and Centres – India
Category Products/Services
Segment Product 1, product 2, product 3,………………….
Others Product 1, product 2, product 3………
Name Designation
Person 1 Designation
Person 2 Designation
Person 3 Designation
Person 4 Designation
Head Office
Corporate Address Address
Tel No. 91 ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Fax No. 91 ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Website website
Year of Incorporation 19‐‐
Ticker Symbol ‐‐‐‐‐‐
Stock Exchange ‐‐‐
20CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Financial Snapshot Key Ratios
Financial Summary
• The company earned a net profit of INR 283.3 mn in FY 2012, as compared to net profit of INR 411.3 mn in FY 2011
• The company reported total Income of INR 8,618.3 mn in FY 2012 registering an increase of 15.28% over FY 2011
• The company earned an operating margin of 6.09% in FY 2012, a decrease of 0.73 percentage points over FY 2011
• The company reported debt to equity ratio of 0.92 in FY 2012, anincrease of 1.30% over FY 2011
Financial Summary
Indicators Value Market Capitalization (INR) ‐
Total Enterprise Value (INR) ‐
EPS (INR) ‐PE Ratio (Absolute) ‐
Particulars y‐o‐y change
(20‐‐‐‐)20‐‐ 20‐‐ 20‐‐ 20‐‐
Profitability RatiosOperating 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 RatiosOperating costs (% of Sales) ‐ ‐ ‐ ‐ ‐
Administration costs (% of Sales)
‐ ‐ ‐ ‐ ‐
Interest costs (% of Sales) ‐ ‐ ‐ ‐ ‐
Liquidity RatiosCurrent Ratio ‐ ‐ ‐ ‐ ‐
Cash Ratio ‐ ‐ ‐ ‐ ‐
Leverage RatiosDebt to Equity Ratio ‐ ‐ ‐ ‐ ‐
Debt to Capital Ratio ‐ ‐ ‐ ‐ ‐
Interest Coverage Ratio ‐ ‐ ‐ ‐ ‐
Efficiency RatiosFixed Asset Turnover ‐ ‐ ‐ ‐ ‐
Asset Turnover ‐ ‐ ‐ ‐ ‐
Current Asset Turnover ‐ ‐ ‐ ‐ ‐
Working Capital Turnover ‐ ‐ ‐ ‐ ‐
Capital Employed Turnover ‐ ‐ ‐ ‐ ‐
Total Income
Profit / Loss
0
5,000
10,000
0
200
400
600
Total IncomeINR mn
ProfitINR mn
2012
y4
x3
2010
x4y2
x2
20112009
y1y3
x1
Public: Domestic Company – Company 1 (2/3)
21CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
Key Business Segments Key Geographic Segments
0%
50%
100%
k4y4
x4
20--
X3
z3 k3y3
x3
20--
X2
z2 k2y2
x2
20--
X1
z1k1 y1
x1
20--
X4
z4
DCBA
0%
50%
100%
20‐‐
xCountry 1
Public: Domestic Company – Company 1 (3/3)
Business Highlights
Description News
Overview • Company 1 is one of the leading players in the field of x and construction equipment manufacturing
• Company has a market share of around y% in the A segment
Network and Distribution
• Effective pre‐sales and after‐sales service is provided by the company through a wide network of dealers and area offices in z locations and has x area or regional offices across the country
• Dealerships have also been established in foreign nations such as Country 1, Country 2, Country 3, Country 4, Country 5 and Country 6 with a view to provide support to the construction equipments of the company deployed in those regions
Country 1 is the only geographic segment of the
company
22CONSTRUCTION EQUIPMENT MARKET IN INDIA 2012.PPT
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