Market Research Report : Sanitaryware market in india 2013

Sanitaryware Market IndiaSanitaryware Market – India

October 2013

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

Challenges:• Rise in Power and Fuel Costs• Large Unorganized Sector• Seasonality

• Untapped Market Potential • Increasing Awareness Among Consumers

Government Total Sanitation Campaign & 12th Five Year Plan (2012‐17) Public Toilet Schemes

Trends Premium Sanitaryware Segment Increasing Foreign Presence

Initiatives Housing Policies 100% FDI in Real Estate

Competition

Trends Emergence of Concept Washrooms Green Initiatives

Major Brands

2SANITARYWARE MARKET IN INDIA 2013.PPT

CompetitionCompany 1 Company 2 Company 3 Company 4

•Economic Indicators•Introduction•Market Overview•Sanitation Facilities•Export‐Import•Drivers & Challenges•Government Initiatives•Trends•Competitive Landscape•Strategic Recommendations

3

•AppendixSANITARYWARE MARKET IN INDIA 2013.PPT

Economic Indicators (1/3)

a2a1

INR tn

14b4c4b3

GDP at Factor Cost: Quarterly

d3

a2b2c2

d2

a1b1

c1

d1

13

12

11

d4c3

Q2Q110

Q4Q32012‐132011‐122010‐112009‐10

Inflation Rate: Monthlyy

0.8

1.0%

ca

0.2

0.4

0.6

0.8

edb

4

0.0Mar 2013 ‐ Apr 2013Feb 2013 ‐Mar 2013Jan 2013 ‐ Feb 2013Dec 2012 ‐ Jan 2013Nov 2012 ‐ Dec 2012

SANITARYWARE MARKET IN INDIA 2013.PPT

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

Designer Ware Sinks

Handcrafted sinks in glass, metal and

ceramic

Shapes

5

Shape 1 Shape 2 Shape 3


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

INR mnMarket Size and Growth (Value‐Wise)

30,000

40,000

50,000

fd

c

x%

hg

0

10,000

20,000

cb

a

6

020‐‐e20‐‐20‐‐20‐‐ 20‐‐e20‐‐e20‐‐e


As of 2011, more than 50% of the total households in nine states were devoid of basic latrine facilitiesBasic 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 2State 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

India has been witnessing a trade deficit over the past two years…

Exports • Indian sanitaryware exports declined by a CAGR of ‘z’% in value terms between FY 20‐‐ and FY 20‐‐

Exports (Value and Volume)

INR mn ‘000 KgVolumeValue

• 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 100

200

300

500

1,000

1,500‐z%

INR mn 000 Kg

p2

p1l1

n2

n1

m2

m1

l2

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

Region‐Wise Exports – Value Region‐Wise Exports – Volume

0 020‐‐20‐‐20‐‐20‐‐

(20‐‐) (20‐‐)

i1% a1%

Country 3Country 2Country 1

a2%i2% Country 2Country 1

Country 3

h1%g1%

f1%b1%

Country 7Country 6Country 5Country 4Country 3

b2%h2%

g2%f2%

Country 5

Country 1Country 4

Country 9Country 8

8

Note: HS Code 74182010 – Sanitaryware


d1% c1% OthersCountry 7

c2%d2%f2%

OthersCountry 9

Drivers & Challenges – Summary

Drivers ChallengesDrivers

High Income and Changing Lifestyle

Real Estate Boom

g

Rise in Power and Fuel Costs

Large Unorganized Sector

Replacement Demand

Untapped Market Potential

Increasing Awareness Among

Seasonality

Increasing Awareness Among Consumers


Government Initiatives – Summary

Impact

Total Sanitation Campaign &p g12th Five Year Plan (2012‐17)

Public Toilet Schemes

Housing Policies (Urban)

100% FDI in Real Estate

10

100% FDI in Real Estate


Trends – Summary

Green Initiatives Premium Sanitaryware Segment

Key Trends

Emergence of Concept Washrooms

Increasing Foreign Presence


Competitive Benchmarking – Public Companies (1/5)

Key Ratios of Major Public Companies – Operational Basis (FY 2013) (1/3)

50 a1%

a2

Net MarginOperating MarginGross Margin

10

20

30

4050 a1

3b3

a3

c2b2

a2

c1b1

010

Company 3

c3

Company 2Company 1

c1

• 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 gmargin 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

12

margin of c1 % and c3 % respectively


Competition Curve – Public Companies

5 000

10,000

15,000

INR mn

c1

b

a1

FY 20‐‐

Total Income Net Profit/Loss

0

5,000

Company 3

c2

Company 2

b2b1

Company 1

a2

FY 20‐‐5,000

10,000

15,000

INR mn

n1

m1l2

l1 Net Profit/LossTotal Income

0

5,000

Company 3

n2

Company 2

m2

Company 1

l2

INR mn

FY 20‐‐ 10,000

20,000

r2

r1

q2q1

p1

p2

Total Income Net Profit/Loss

13

0r2

Company 3

q2

Company 1

p

Company 2


Public: Domestic Company – Company 1(1/5)Company Information Offices and Centres – India

Corporate Address

Tel No.

Fax No.

Website

Year of Incorporation

Gurgaon

Ticker Symbol

Stock Exchange Head OfficeProducts

Key People

N D i ti

Sanitaryware Products

Name Designation

Person 1 Executive & Non‐Independent Chairman

Person 2 Joint MD

Person 3 Deputy General Manager of Finance

14

Person 4 Assistant VP


K ii i l S h

Public: Domestic Company – Company 1(2/5)

Key RatiosNet Profit / LossTotal Income

15 000

20,0008001,000

INR mn INR mn

d2c2

b2

Particulars y‐o‐y change (2013‐12) 2013 2012 2011 2010

Profitability RatiosOperating Margin

Financial Snapshot

0

5,000

10,000

15,000

0200400600

20‐‐

d1

20‐‐

c1

20‐‐

b1

20‐‐

a2

a1

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

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

Return on Fixed Assets

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

Interest costs (% of Sales)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

Interest costs (% of Sales)Liquidity RatiosCurrent RatioCash RatioLeverage RatiosDebt to Equity Ratio

Key Financial Performance IndicatorsIndicators Value (dd/mm/yyyy)

Market Capitalization (INR mn)Total Enterprise Value (INR mn)

( )

Debt to Capital RatioInterest Coverage Ratio

Efficiency RatiosFixed Asset TurnoverAsset TurnoverCurrent Asset Turnover

15

EPS (INR)PE Ratio (Abs)

Current Asset TurnoverWorking Capital TurnoverCapital Employed Turnover

Improved Decline


Public: Domestic Company – Company 1(3/5)Key Business Segments Key Geographic Segments

80%

100%

1%b1%1% d1%

Segment 1 Segment 3Segment 2

100%

India

India is the only geographic

0%

20%40%60%80%

c3%

c2%

c1%

b3%

b2%

b1%

a3%

a2%

a1%

d3%

d2%

d1% 100%

50%

0%

100%

India is the only geographic segment in which the company has been operating for the last

four years

Business Highlights (1/2)

0%

20‐‐20‐‐20‐‐

a3%

20‐‐

0%20‐‐

Description News

Overview

• 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 4p y y , , Besides, it has also launched the world’s premium brands Brand 5 and Brand 6 in the Indian market

Network • 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

Other Products • Faucets, Wellness Products, Kitchen appliances, Tiles, Container Glass and PET Bottles and Extractor Fans

16

Extractor FansRealizations • Achieved 8.26% higher average realizations per tonne in the sanitaryware segment


Public: Domestic Company – Company 1(4/5)Business Highlights (2/2)

Description News

• Sanitaryware Products:h ll d f ll

Installed Capacity City 1 with installed capacity of 1.5 mn pieces annually City 2 with installed capacity of 2 mn pieces annually

• Faucets: City 3 with installed capacity of 0.5 mn pieces annually

• Company has achieved ‘z’% increment in sanitaryware capacity along with increasing the

Capacity Expansion

p y % y p y g gfaucets 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 subsidiarybrand 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


Public: Domestic Company – Company 1 – SWOT Analysis(5/5)

SAMPLESAMPLE WS

TO


Thank you for the attentionSanitaryware Market – India report is part of Netscribes’ Manufacturing & Construction Industry Series.For any queries or customized research requirements, contact us at:Ph 91 22 4098 7600

Follow us on:

Phone: +91 22 4098 7600E‐Mail: [email protected]

About Netscribes, Inc.Netscribes, Inc. is a knowledge‐consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of , g g f g p y p p finvestment & business research, business & corporate intelligence, content‐management services, and knowledge‐software services. At its core lies a true value proposition that draws upon a vast knowledge base. Netscribes, Inc. is a one‐stop shop designed to fulfil clients’ profitability and growth objectives.

Disclaimer: This report is published for general information only Although high standards have been used in the preparation “Netscribes” is

19

Disclaimer: This report is published for general information only. Although high standards have been used in the preparation, Netscribes is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes and prior permission is required for guidelines on reproduction.


Market Research Report : Sanitaryware market in india 2013

Business

g p y p y g marginofa1

monthly y

country9 country

country7 country

50020country3 country

state1 state2 state

country4country5 country6f1

5000country1 i1