market research report : machine tools market in india 2012

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Machine Tools Market IndiaMachine Tools Market – India

June 2012

Executive Summary

MarketThe global machine tool market witnessed a turnover of INR x1, up by a% y‐o‐y in 20‐‐, including the 28 principal machine tool manufacturing nations

The total market size for machine tools was INR y1 during 20‐‐

Drivers Challenges

Drivers & Challenges

Drivers—Growth of industries using machine tools—Strong supporting industries‐ Foundry & Castings—Abundance of key raw materials—Availability of skilled and cheap labour force

Challenges—Insufficient production capacity

—Lack of proper funding—Lack of investment in R&Dy p

—Consistent supply of skilled manpower —Regulatory challenges

Credit Linked capital Subsidy Scheme for Technology Upgradation

National manufacturing Competitiveness Programme (NMCP)

Quality Upgradation/ Environment management for small scale sector

Government Initiatives Quality Upgradation/ Environment management for small scale sector

Trends

Exhibitions to develop trade

India Increased focus towards India for developing machine tools

Transformation towards multitasking technology

Competition

Major Players

Company A Company B Company C

Usage of IT

2MACHINE TOOLS MARKET IN INDIA 2012.PPT

Company D Company E Company F

•Introduction

M k t O i•Market Overview

•Import & Export

•Drivers & Challenges

•Government Initiatives

•Trends

•CompetitionCompetition

•Strategic Recommendations

•Appendix


•Appendix

China dominates the global machine tool market both in terms of production and consumption

Global Machine Tools Market – Overview

• The global machine tool production in 20‐‐ was estimated to be INR x1, a growth of a1% over the previous year, including the 28 principal machine tool manufacturing nations

• In terms of production in 20‐‐, China ranked first holding a share of a2% of the total world production, followed by Japan, Germany, Italy, Korea, Taiwan and USA

•On consumption side as well China ranked first with a share of a3% of the overall world consumption in 20‐‐, followed by Japan and then by Germany and USA, then came Korea finally followed by Italy and India

Production of Machine Tools (20‐‐) Consumption of Machine Tools (20‐‐)

by Japan and then by Germany and USA, then came Korea finally followed by Italy and India

• India’s share in terms of consumption was a4% of the overall global consumption for the year 20‐‐

p1

p8p7

p2m8

m7m6 m1p6

P5

p4 p3

m5

m4

m3m2


H

G

F

E

D

C

B

A

H

D

G

C

F

B

E

A

The Indian manufacturing sector’s growth is triggering the consistent growth of the machine tool market in India

•Machine Tool Industry is considered as the major feeder for the entire capital goods sector as it provide

Indian Machine Tool Market – Overview (1/2)

Machine Tool Industry is considered as the major feeder for the entire capital goods sector as it provide

machineries for the entire manufacturing sector

Manufacturing sector accounts for a5% of the industrial output and it grew by a6% during the year 20‐‐, reflecting a direct

effect on the growth of the machine tool sector in the coming years

•Machine tools market is expected to reach INR x2 growing at a CAGR of a6% during 20 to 20 e period•Machine tools market is expected to reach INR x2, growing at a CAGR of a6% during 20‐‐ to 20‐‐e period

Market Size & Growth

200

250

INR units

x10x9

x8a2

Market Size & Growth

50

100

150 a1x7

x6x5

x4x3x2x1


020‐‐ ‐ ‐‐20‐‐ ‐ ‐‐20‐‐ ‐ ‐‐ 20‐‐ ‐ ‐‐20‐‐ ‐ ‐‐20‐‐ ‐ ‐‐20‐‐ ‐ ‐‐20‐‐ ‐ ‐‐20‐‐ ‐ ‐‐20‐‐ ‐ ‐‐

Gap between demand and supply of machine tools is leading to import dependency in order to bridge the gap

• India has witnessed a rise in imports owing to the

rise in demand from the used segments of machine

Imports Imports (Value)

15,000INR units a3 x4rise in demand from the used segments of machine

tools

• The import during 20‐‐ was recorded to be INR x3

• Italy, Germany, Japan and China are among the top 0

5,000

10,000

,x3

x2x1

importers in the recent years

Major importing nations (20‐‐)

020‐‐ ‐ ‐‐20‐‐ ‐ ‐‐20‐‐ ‐ ‐‐20‐‐ ‐ ‐‐

Major importing nations (20‐‐)

p6pi

DCBA

m6m2

m1 A

DCB

p5p4 p3

p2

FED

m5m4

m3 FED


Note: Machine Tool comes under the HS Code 8459, including way‐type unit head machines for drilling, boring, milling, threading/taping by removing metal, excluding lathes of hdg no 8458

Drivers & Challenges – Summary

Drivers

Growth of industries using machine

Challenges

Insufficient production capacity

Growth of industries using machine tools

Strong supporting industries‐ Foundry & Castings

Lack of proper funding

Lack of investment in R&D

Abundance of key raw materials

Availability of cheap labour force

Regulatory challenges

Consistent supply of skilled manpower


Trends – Summary

Exhibitions to promote trade Increased focus towards India for developing machine tools

Key Trends

Usage of IT Transformation towards multitasking technology


Public: Domestic Company – Company A (1/3)Company Information Offices and Centres – India

Corporate Address

Company A, Street A

City B

State C

Tel No. 91 124 7239

Fax No. 91 124 4734111

Website www.company.co.in

Products and Services

Year of Incorporation 1767

Ticker Symbol 123456

Stock Exchange ABC Head OfficeCity B

Key People

Products and Services

Category Products/Services

N D i ti

Engineering

Threading tools, carbide tools, spring locked washer, marking solutions, energy solutions, integrated power solutions from turbine, generator, synchronization panel

Name Designation

Person A MD, CEO

Person B. Director

Person C Director


synchronization panelPerson D Director

i i l S h K i

Public: Domestic Company – Company A (2/3)Financial Snapshot Key Ratios

Particulars y‐o‐y change (2011‐10)

2011 2010 2009 2008

Profitability RatiosOperating Margin

Net Profit/LossTotal Income

15 000

20,000 500a

INR units INR unitsdc

bNet MarginProfit Before Tax MarginReturn on EquityReturn on Capital EmployedReturn on Working CapitalReturn on Assets

0

5,000

10,000

15,000

-1,000

-500

0

R1

20‐‐

R4

20‐‐

R3

20‐‐

R2

20‐‐

Financial Summary Return on Fixed Assets

Cost RatiosOperating costs (% of Sales)Administration costs (% of Sales)

Interest costs (% of Sales)

The company incurred a net loss of INR d units in FY 20‐‐, as compared to net loss of INR c units in FY 20‐‐The company reported total income of INR R4 units in FY 20‐‐,

i t i i f % FY 20 Interest costs (% of Sales)

Liquidity RatiosCurrent RatioCash Ratio

Leverage RatiosDebt to Equity Ratio

b i l i

registering an increase of m% over FY 20‐‐The company earned an operating margin of f% in FY 20‐‐, an increase of g percentage points over FY 20‐‐The company reported debt to equity ratio of d in FY 20‐‐, a decrease of h% over FY 20‐‐

Key Financial Performance Indicators

Indicators Value (dd/mm/yyyy)Market Capitalization (INR mn) uTotal Enterprise Value (INR mn) vEPS (INR)

Debt to Capital RatioInterest Coverage Ratio

Efficiency RatiosFixed Asset TurnoverAsset TurnoverCurrent Asset Turnover


EPS (INR) wPE Ratio (Absolute) x

Working Capital TurnoverCapital Employed Turnover

Improved Decline

Public: Domestic Company – Company A (3/3)Key Business Segments Key Geographic Segments

NMLBA

0%

50%

100%

Y4

X4

Y3

X3

Y2

X2

Y1

X1 100%

50%

0%

c4

a4 b4

c3

a3 b3

c2

a2 b2

c1

a1 b1

Business Highlights

0%20‐‐20‐‐20‐‐20‐‐

0%20‐‐20‐‐20‐‐20‐‐

Description News

Overview • It is world’s one of the oldest companies and is engaged in three segments‐ x, y,z

Collaborations • Bagged three projects which requires advanced level of engineering design and construction worth INR x4 in total with X Ltd, Y Ltd and Z Ltd,


Appendix

Ratio Calculations

Operating Margin (Operating Income/Revenues)*100

Ratio Calculations

Current RatioCurrent Assets / Current Liabilities

Net Margin (Net Profit / Revenues) *100

Profit Before Tax Margin (Income Before Tax / Revenues *100

(N I / Sh h ld

Cash Ratio{(Cash & Bank Balance + Marketable Securities) / Current Liabilities)}

Debt to Equity Total Liabilities / Shareholders E it

Return on Equity (ROE) (Net Income / Shareholders Equity)*100

Return on Capital (ROCE) EBIT / (Total Assets – Current Liabilities)*100

(N I / W ki C i l)

q yEquity

Debt to Capital Ratio{Total Debt / (Shareholders Equity + Total Debt)}

Interest Coverage Ratio EBIT / Interest Expense

Return on Working Capital (Net Income / Working Capital) *100

Return on Assets (Net Income / Total Assets)*100

Return on Fixed Assets (Net Income / Fixed Assets) *100

Fixed Asset Turnover Sales / Fixed Assets

Asset Turnover Sales / Total Assets

Operating Costs (% of Sales) (Operating Expenses / Sales) *100

Administration Costs (% of Sales)

(Administrative Expenses / Sales) *100

Current Asset Turnover Sales / Current Assets

Working Capital Turnover Sales / Working Capital

/


Interest Costs (% of Sales) (Interest Expenses / Sales) *100 Capital Employed Turnover Sales / Shareholders Equity

Sources of Information

Secondary Research

Print MediumLeading Newspapers

Primary Research

InterviewsLeading Industry VendorsLeading Newspapers

Journals / Magazines

Business Magazines

Electronic Medium

Leading Industry Vendors

Industry Stakeholders

Industry Experts

Surveys Conducted in Social / Technology Focused Forums

Company Websites

Government Websites / Resources

Online Magazines

Online Journals / Articles

Forums

/

Premium Databases

Social Networking Space


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