Market Research Report : Snacks Market in India 2013

Snacks Market IndiaSnacks Market – India

May 2013

SAMPLE Executive Summary

Market

Indian snacks market was valued at INR XX bn in 20__and is estimated to reach INR YY bn by 2017__With changing consumer behavior due to various factors such as increasing income levels and busy urban lifestyle these products are gaining popularity amongst thembusy urban lifestyle, these products are gaining popularity amongst them

Drivers—Rapid UrbanizationG i I d C ti

Challenges—Rise in Packaging CostsU i d S t d L l

Drivers & Challenges

—Growing Income and Consumption—Increasing Working Women Population—Marketing Campaigns—Growing Retail Market—Convenience Factor

—Unorganized Sector and Local Players

—Competitive Price Points—Health Concerns

—Convenience Factor

Exhibitions and Events Product InnovationCorporate Activities

Trends

Launch of Various Ethnic Snacks Innovative Promotional Campaigns Introduction of Healthy Snacks

CompetitionMajor Players

Corporate Activities Inclusion of Nuts as Snacking Option

Introduction of Healthy Snacks

2SNACKS MARKET IN INDIA 2013.PPT

CompetitionCompany A Company B. Company C

SAMPLE •Macro‐Economic Indicators

•Introduction

•Market Overview•Market Overview

•Market Segmentation

•Consumer Insightsg

•Import & Export

•Drivers & Challenges

•Government Rules & Policies

•Government Participation

•Trends•Trends

•Competitive Landscape

•Strategic Recommendations


g

•Appendix

SAMPLE Economic Indicators (1/3)

INR tn

15 b4a3

GDP at Factor Cost: Quarterly

14

13

12

11

c4

d4

b3c3

d3

a2b2c2d2

a1b1

c1

d1

10Q4Q3Q2Q1

2012‐132011‐122010‐112009‐10

Inflation Rate: Monthlyy

0 8

1.0 e5

%

e2

0.2

0.4

0.6

0.8

e4e3e1


0.0Dec 2012 ‐ Jan 2013Nov 2012 ‐ Dec 2012Oct 2012 ‐ Nov 2012Sep 2012 ‐ Oct 2012Aug 2012 ‐ Sep 2012

SAMPLE Food processing can be sub‐segmented into numerous categories which include snacks as well

Market Segmentation

Food Processing

Fruits &X Y

MarineZ U

VegetablesX Y

ProductsZ U

A Beverages C

q Baked Products Snacks rp Others


Focus of the report

SAMPLE The Indian snacks market is expected to witness remarkable growth…

Indian Market – Overview (1/5)

• Snacks refer to those food products which are consumed between meals to satisfy hunger temporarily• Snacks refer to those food products which are consumed between meals to satisfy hunger temporarily

• It has gained popularity amongst consumers due to various factors such as increasing income levels, hectic lifestyle and convenience associated with its consumption

• Indian snack market is quite competitive in nature due to presence of MNCs, regional and local players as well as the unorganized sectorwell as the unorganized sector

•During 20__, Indian snack market was valued around INR X1 bn

Market Si e & Gro thMarket Size & Growth

250

300

INR bn

y

x6

x5

50

100

150

200 x4x3

x2x1


0

50

20__20__20__20__20__20__

SAMPLE …in the next few years with increased consumption amongst consumers


• Lots of varieties of snacking options are available in

Market Segmentation (20__)

Organized Sector

the Indian market which is another factor behind making it competitive

• Players keep on innovating with flavors as consumers want variety and tasteS k i i l h d t d Unorganized Sector• Snacks is an impulse purchase product and consumers in general are not loyal to any particular brand

a1a2

• Despite the presence of organized players such as PepsiCo, ITC and Haldirams, unorganized sector dominates the market

• Local and regional players raised market share• Local and regional players raised market share by invading those markets where there was absence of bigger brands

• Bigger players initially focused on urban markets and upon its saturation


markets and upon its saturation gradually shifted its focus towards other lower tier markets

SAMPLE Lots of varieties of snacks are available in the market and…


• Snacks market is very dynamic as events such as entry of new players and launch of wide range of products by existing players keep on happeninglaunch of wide range of products by existing players keep on happening Whenever new products enter any category, market shares of major players get affected Though major players have maintained their top positions, but, their market shares got reduced in the past few years

Change in Market Share of Major Players

Market Share (20 ) Market Share (20 )Market Share (20__) Market Share (20__)

A6A5A4

A3

B7B6B5

B4B

A

A3

A2A1

B4

B3

B2

B1

F

E

D

C


B2Others

SAMPLE Snacks are broadly classified into two segments

Market Segmentation (1/3)

Snacks ‐ Classification

Indian market is filled with wide varieties of snacks, but, all of them are classified under two broad categories

Western Traditional

Segmental Share (20__)Market Share of Various Snacks (20__)

A

gf

ea

O h

F

E

C

B

A

b1a1

B

A

d

Others

D

C


cb

SAMPLE Western snack segment is already very popular amongst consumers…

Market Segmentation – Western Snacks (2/3)

Western Snacks

•Western snacks include products such as chips, wafers, crisps and extruded snacks Potato chips account for the major share in Indian snacks marketB Potato chips account for the major share in Indian snacks market

• XX

• XX

B

A

B

A

Organized‐Unorganized Breakup


O ga ed U o ga ed ea up(20__)

SAMPLE Consumer Insights on Snacks (1/11)

Sample Size 80Survey Duration &

Period3 Weeks – March 2013

Sample SourcesSocial Media Websites and

Other Related ForumsQuantitative

Representation UsedPercentage

• Survey on snacks was conducted on social media sites and other related forums

•Overall survey has been kept close‐ended to

Profile of Respondents – Age Wise (years)

41 & above

36‐40

31‐35

25‐30

18‐24y p

capture specific information according to requirements

• The survey has been conducted amongst a group of general consumers heading from

DEC

B

36 4025 30

major Indian cities including Mumbai, Delhi, Kolkata, Pune, Hyderabad, Bangalore among others


A


Options

Q: Do you consume snacks?

Options

Q: If you don’t consume snacks at present, would you like to try it in future

Options1) Yes 2) No

Options1) Yes2) No

Consumption Share of Snacks

B

Share of Potential Future Consumers

DD

A

C


NoYesNoYes


Options

Q: What type of snacks do you prefer?

Options

Q: If you consume both, which one do you prefer more?

1) X 2) Y3) Z

Options1) A2) B

Consumption Pattern Preference‐wise Share of ‘Both’ Category

A70

80

%

C

Y

B

40

50

60

70

X10

20

30

BA


0BothYX

SAMPLE Import of Major Types of Snacks (1/2)

A Snacks

2,000

‘000 unitINR mn

300 C

ValueVolume

fe F

E

D

C

B

A

Major Importing Nations – Value Wise (2011)

500

1,000

1,500

2,000300

200

100

S

DRQ

B

P

A

ed

c

b

a

FC

B Snacks & Mixtures

0020__20__20__20__

Major Importing Nations – Value Wise (2011)

u p

T

S

R

Q

P

6,000

8,000

‘000 unitINR mn

200

150

E

ValueVolume

ts

rq

U

T

0

2,000

4,000100

50

020__

W

H

20__

V

G

20__

U

F

20__

T


Note: HS Code 190190 (Food preparations based on malt extract – Salted Snacks ), HS Code 190410 (Prepared foods obtained by swelling or roasting of cereals –Packaged Snacks & Mixtures)

________

SAMPLE Drivers & Challenges – Summary

Drivers

Rapid Urbanization

Challenges

Competitive Price Points

Growing Income and Consumption

Marketing Campaigns

i ki

Unorganized Sector and Local Players

Rise in Packaging Costs

Increasing Working Women Population

Growing Retail Market

Health Concerns

Convenience Factor


SAMPLE Trends – Summary

Exhibition and X

Product Y

i i i

`Key Trends

Corporate Activities

Inclusion of A as Snacking Option

Launch of Various Q Snacks

d f k

Innovative Promotional Campaigns


Introduction of P Snacks

SAMPLE Competitive Benchmarking (1/5)

Public Trading Comparables (FY 2012)

Company A Company B

Market Capitalization (INR mn) xx xx

Share Price (INR) xx xx

EV/EBITDA (x) xx xx

/EV/Revenue (x) xx xx

PE Ratio xx xx


Note: Top 2 Public companies based on the Market Capitalization; Market Capitalization, Share Price is as on 5/04/2013 and PE ratio is as of 9/04/2013

SAMPLE SAMPLE Competitive Benchmarking (2/5)SKey Ratios of Top 3 Companies – Operational Basis (FY 2011) (1/3)

40

% Net MarginOperating Margin

2 49

11.04

30.39

7.30

21.73

10

20

30

40

2.49 1.410

CompanyCCompany BCompany A

• xx


SAMPLE Public: Domestic Company – Player A (1/5)

Company Information Offices and Centres – India

Corporate Address xx

Tel No. xx

Fax No. xx

Website xx

Year of Incorporation xx

Products and Services

Ticker Symbol xx

Stock Exchange xxHead OfficeCity A

Key People

Products and Services

N D i ti

Category Products/Services

RTE Products xx Name DesignationRTE Products xx

Other Food Products xx


SAMPLE i i l S h K i

Public: Domestic Company – Player A (2/5)

Financial Snapshot Key Ratios

Particulars y‐o‐y change (2012‐11)

2012 2011 2010 2009

Profitability RatiosOperating Margin ‐3.31 7.37% 10.69% 11.63% 14.80%

Net Profit/LossTotal Income

1500

2000 150INR mn INR mn

dc

ba

Net Margin ‐6.73 4.02% 10.75% 12.08% 7.61%

Profit Before Tax Margin ‐5.22 6.52% 11.74% 15.66% 11.00%

Return on Equity ‐7.25 5.51% 12.76% 13.22% 9.02%

Return on Capital Employed ‐2.22 8.50% 10.73% 12.11% 16.70%

Return on Working Capital ‐7.92 20.82% 28.74% 28.25% 56.05%

Return on Assets ‐1.89 6.67% 8.56% 10.77% 14.08%

0

500

1000

1500

0

50

100

2012

D

2011

C

2010

B

2009

a

A

Financial Summary • The company incurred a net profit of INR 63.7 mn in FY 2012, as compared to net profit of INR 142.4 mn in FY 2011

• The company reported total income of INR 1585.4 mn in FY 2012, registering an increase of 19.7% over FY 2011

Return on Fixed Assets ‐4.90 26.02% 30.92% 33.44% 41.15%

Cost RatiosOperating costs (% of Sales) 3.47 92.50% 89.03% 87.70% 84.70%

Administration costs (% of Sales)

5.78 33.11% 27.33% 22.91% 25.64%

Interest costs (% of Sales) ‐0.24 0.82% 1.06% 1.21% 1.74%registering an increase of 19.7% over FY 2011

• The company earned an operating margin of 7.37% in FY 2012, a decrease of 3.31 percentage points over FY 2011

• The company reported debt to equity ratio of 0.32 in FY 2012, a decrease of 7.22% over FY 2011

Interest costs (% of Sales) % % % %

Liquidity RatiosCurrent Ratio 0.43% 2.49 2.48 4.42 2.60

Cash Ratio ‐14.77% 0.53 0.63 1.76 1.09

Leverage RatiosDebt to Equity Ratio 7.22% 0.32 0.30 0.01 0.02

b i l iKey Financial Performance Indicators

Indicators Value (dd/mm/yyyy)Market Capitalization (INR mn) XXTotal Enterprise Value (INR mn) XXEPS (INR)

Debt to Capital Ratio 5.46% 0.24 0.23 0.01 0.02

Interest Coverage Ratio ‐12.08% 9.10 10.35 10.14 8.78

Efficiency RatiosFixed Asset Turnover 23.09% 3.47 2.82 2.72 2.69

Asset Turnover 14.00% 0.89 0.78 0.88 0.92

Current Asset Turnover 6.29% 1.66 1.56 1.78 2.26

20

EPS (INR) XXPE Ratio (Abs) XX

Working Capital Turnover 5.98% 2.78 2.62 2.30 3.66

Capital Employed Turnover 14.65% 1.02 0.89 1.02 1.13

Improved Decline

SNACKS MARKET IN INDIA 2013.PPT


Key Business Segments Key Geographic Segments

ExportsIndiaProcessed and Preserved FoodsTraded Goods

0%

50%

100%

FED

C

B

A

0%

50%

100%

TR

S

P

Q

U

0%2012201120102009

0%201120102009 2012

Business Highlights

Description News

Overview •XX



Description News

Business Highlights

Global Presence • XX

Quality Assurance • XXQ y XX

E i XXExpansions • XX


SAMPLE Public: Domestic Company – ITC Ltd. – SWOT Analysis(5/5)

• xx • xx

WS

TO

• xx• xx


SAMPLE Strategic Recommendations (1/4)

Product Price

• XX • XX

Promotion Place of DistributionPromotion Place of Distribution

• XX • XX


SAMPLE Strategic Recommendations (3/4)

A B

• XX • XX

OTHERR

STR

CATEGI

• XX

IES


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

q yEquity

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

Interest Coverage Ratio EBIT / Interest Expense

Return on Working Capital (EBIT / Working Capital) *100

Return on Assets (EBIT / Total Assets)*100

Return on Fixed Assets (EBIT / 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

Sales / (Shareholders Equity +


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

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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Market Research Report : Snacks Market in India 2013

Documents

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regional players

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