Session3 India Today

7/30/2019 Session3 India Today

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07/07/06 Essec, France

India Today

Prof. Atul TandanDirector, MICA


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07/07/06 Essec, France 2


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Population

Ownership & Consumption

Media Industry

Entertainment Industry

Know India


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Population

2.5% of the worlds land mass

16% of the worlds population

Every sixth person in the world is an Indian and

every fourth person in Asia is an Indian

India adds an Australia to its population every year

Population projection for 2011

For under 15 years: 370 million For 15-64 years: 747 million

For 65+ years: 58 million

15% in the age group of 0-6 years


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Population

Male and female literacy of 75.85% and 54.16%

respectively

Male and female life expectancies of 62.3 years and

65.3 years respectively Overall literacy rate 65%

Current middle class of around 600 million people

Nearly 40% of the population (402 million) are in the

working age Indians urban working population is as much as the

total working population of France and Italy

Thus India represents a young country full of opportunities


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A market that grows by 30 million consumers

every year

75 million Indian families own a television

35 million households own two wheelers

Second largest producer of two wheelers, market

size valued at $1200 million

Every second urban house hold has a bank

account

Consumer finance market grown to $20 billion


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Indian Readers have a choice of 30000 odd

magazines and newspapers

Tele-density (cellular and fixed) 11 and growingat an annual rate of 40% against the world

average of 15%

75 million cellular subscribers and still growing at

a rate of 35% per annum

5 personal computers for every 1000 people

Largest producer of Cigarettes



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Rural Wallet

26.5, 26%

4, 4%

8, 8%

6, 6%

3, 3%

5, 5%

6, 6%3, 3%

13, 13%

2, 2%

1, 1%

6, 6%

5, 5%

0.5, 1%

7, 7%4, 4% Groceries

Personal care

Medicines/Healthcare

Fuel

Entertainment/Music

Savings/Investment

Interest repayment

Jewellery

Agricultural inputs

Household maintainence

Home textiles

VehicleConsumer durables

Home appliances

Apparel/Footware

Hard liquor/Tobacco

A fourth of the expense is on Groceries


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Media Industry

Cable Television industry $1.2 billion currently in revenue terms

Growing at approximately 15-20% p.a.

Likely to be $3 billion by year 2010

Share of print media in ad expenditure Globally: 45%

India: 55%

Ad. Expenditure to GDP ratio expected to increase to

0.65%, comparable to other developing andemerging countries like Brazil, Indonesia andThailand.

Television software industry likely to be $3 billion by

2008


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Projected size of entertainment

industry: $11 billion by 2010

Exports market size of $700

million; exhibiting a stronggrowth

Film market

Expected to grow at 25% p.a.

in the next three years

Projected size of $4 billion

Music industry will be $500

million in size by 2010

http://localhost/var/www/apps/conversion/tmp/pandadonotdelete/PATrev1/I0201035.MPG


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Radio (which receives only 2% of total

advertising)

Expected to grow to the international

average of 30% by 2010 Size of market in revenue terms projected to

be around $200 million

Live entertainment and event management

industry

Growing at a rate of 50% p.a.

Expected to be $300 million by 2010


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India: A Statistical View

Macro Economic Indicators

Engines of Economic Growth

Major Market Trends


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Indicators 1980s 1990s 2005-06 Likely 2010

Read GDP (% change) 5.8 6.2 7 10

Share of Agriculture in GDP 38 31 22 20

Food grain production (Mn tonnes) 146 195 212 220

Share of Industry in GDP (%) 26 29 26 25

Share of Services sector in GDP (%) 36 40 52 55

Per Capita Income (US$) 230 395 550 790

Savings rate(% of GDP) 19.4 23.2 30 35

Investment rate(% of GDP) 21.2 24.5 30 35

Exports (In $ Bn) 9.5 27 47 100

Growth in exports 8.1 9.7 30 50

Selected Macro Economic andFinancial Indicators 1980 2010


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Current growth in Real GDP around

7% and expected to grow by 8% by

2007, double digit by 2010

Industry growth of 12%

Service sector constitutes nearly

52% of GDP

Average Annual Growth potential of

service sector in providing

employment is 11% oftotal labor

force

Rate of Investment is 30% of GDP

Rate of Savings is 30% of GDP


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Lowest ever bank rate of 6%

Low rate of inflation of 4% offers higher return on

investment

Relatively stable exchange rate

Relatively stable stock market offering high return

to most Foreign Institutional Investors in the long-

run

Foreign Direct Investment of around $45 billion

constituting 1% of GDP

Foreign exchange reserve in excess of $160 billion



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Low growth of 5% in consumer price index offers wide range

of choice for purchasing

Per capita income

Currently PPP $ 3300

Growing at nearly 6% p.a.

Instability - lowest as compared to most Asian economies

Total External Commercial Borrowing approvals during 2005-

06 - $40billion

Growth of exports 30% and 12% of GDP

Growth of imports 48% and 18% of GDP



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FDI Inflows August 91 Jan 06Top 10 Sectors

Cement & Gypsum

3%

Metallurgical 3%

Drugs & Pharma 4%

Food Processing 5%

Chemicals 10%

Telecom 13%

Services 13%

Transportation 14%

Electrical Equipments

22%


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Engines of Economic Growth

A thoroughly professional PM

Increased presence in geo-politics

Rapidly rising education levels

Accelerating rates of technological innovation and

application

Cheaper and faster communication dissolving physical and

social barriers, both within the country and internationally

Information made available in greater quantity and quality

than ever before

Opening up of new markets because of globalization


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Segmentation of Household(in mln)

Consumer Group Annual Income (Rs.) 1994-95 2006-07

Very Rich > 1250001 1 6.8

Consuming Class 45000-215000 28.6 90.9

Climbers 22000-45000 48 74.1

Aspirants 16000-22000 48 15.3

Destitute


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New Consumer Shifts

From functional to convenience goods

From unbranded to branded products

From need-based buying to joy buying

From physical products to concept selling From low price to high-end products

Spending leisure time on whatever is

available in high fashioned entertainment Increasing consumer awareness on products

and product value

Leap-frogging sunrise areas


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Telecommunication

8th largest network in the world & 3rd largest

among the emerging economies (after China

and Korea)

250 million line basic telephone network

75 million cellular mobile network

Average annual growth rate

30% for basic services

More than 100% for cellular and internet

services


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Telecommunication

Projections for number of connections

175 million connection by 2008

Investment opportunity of

Approximately $80 billion by 2008

$120 billion by 2010

Move towards Value Added Services


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Milestones and Achievements

From two state run channel in 1990 to close to

340 channels currently 54 million cable and satellite homes which

translates to 270 million viewers

More than 1000 movies produced in a year

Granted an Industry status
http://rds.yahoo.com/_ylt=A0Je5mgTkqJET9oAUjeJzbkF;_ylu=X3oDMTBjYzZubXM2BHBvcwM4BHNlYwNzcg--/SIG=1mqco14cv/EXP=1151591315/**http%3a//images.search.yahoo.com/search/images/view%3fback=http%253A%252F%252Fimages.search.yahoo.com%252Fsearch%252Fimages%253Fp%253Dmoulin%252520rouge%252520movie%2526sp%253D1%2526ei%253DUTF-8%2526fr%253Dslv1-%2526SpellState%253Dn-1400921332_q-JM.SSEFLfaRYHCCrX8hKUwABAA%2540%2540%2526fr2%253Dtab-web%26w=356%26h=514%26imgurl=a1259.g.akamai.net%252Ff%252F1259%252F5586%252F5d%252Fimages.art.com%252Fimages%252F-%252FMoulin-Rouge--C10086484.jpeg%26rurl=http%253A%252F%252Faffiliates.art.com%252Fget.art%253FT%253D15039093%2526A%253D520925%2526L%253D8%2526P%253D10086484%2526S%253D2%2526Y%253D0%26size=34.9kB%26name=Moulin-Rouge--C10086484.jpeg%26p=moulin%2brouge%2bmovie%26type=jpeg%26no=8%26tt=5,233%26ei=UTF-8


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Entertainment industry

Requirement of at least 20000 screens in

India as against 12548 currently

1500 new multiplexes screens expected

to be set up in the next 2-3 years 100% FDI in the film industry permitted

Industry raised $40 billion from capital

market during the year 2005

Accounts for 20% of worldwide $40 billionanimation business due to inherent

advantages like IT skills and cost

competitiveness
http://www.santabanta.com/wallpapers/rating.asp?catid=1210017


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Banking Insurance and FinancialMarkets

290 commercial banks including 40 odd foreign banks

Over 70000 branches throughout the country

Roughly 40 million shareholders

India has the third largest investor base in the world next toUSA and Japan

Assets under management with the Indian Mutual Fund

Industry in excess of $70 billion

Cumulative net investment by FIIs in Indian securities morethan $30 billion

Size of Life Insurance Business $350 billion

Size of Non life insurance $175 billion


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Electronics and InformationTechnology

Software sector growing at a rate of 58% p.a.

Software exports expected to grow to $100 billion by 2010.

Around 200 out of the Fortune 500 companies outsource

their software requirements to Indian software companies

Expected to generate revenue to the tune of $130 billion by

2010

IT enabled services sector will generate $25 billion by 2010

Leading companies like GE, American Express, HSBC Royal

and Sun Alliance, Le Meridian have set up their call centres

in India


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Brands in India


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Brands in India


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Brands in India
http://www.eurorscg.com/index.asp


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Indias Largest Brands

Rank Brand Company

6 LIC LIC : India7 VICKS P & G : International8 Britannia Dannon:International9 Rin HLL: Unilever10 Bata Bata : India
http://www.bataindia.com/http://images.google.co.in/imgres?imgurl=http://www.indiaabundance.com/productimages/Vicks%2520vaporab_s.JPG&imgrefurl=http://www.indiaabundance.com/frontend/category/oils_and_balms_ah_ob.asp&h=240&w=240&sz=11&tbnid=95FFG9ottW7eyM:&tbnh=104&tbnw=104&hl=en&start=11&prev=/images%3Fq%3DVICKS%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DGhttp://images.google.co.in/imgres?imgurl=http://members.tripod.com/lic_india/index.2.jpg&imgrefurl=http://members.tripod.com/lic_india/&h=276&w=200&sz=14&tbnid=YlrT3t5vlpv6cM:&tbnh=109&tbnw=78&hl=en&start=1&prev=/images%3Fq%3DLIC,%2BIndia%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DG


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Indian Retail Industry

Type 2001 ($ Mn) 2007* ($ Mn)

Large 1770 4621.8

Others 1210 2433.8Non Store 220 387.8

Total Organized Retail 3200 7443.4* Projected Figures


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Fashion and Lifestyle

Apparel 2005 ($ Mn) 2013* ($Mn)

Branded 800 6000

Designer 36.6 2000* Projected Figures


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Some Examples..

Moser-Baer: World's third largestoptical media manufacturer & the

lowest-cost CD-Recorder producer Hero Honda: Largest motorcycle

manufacturer in the world.

Component Suppliers to 15 leadingautomobile giants


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Even Automobiles

Rover is marketing 0.5 mln. Indica cars ofTata in Europe

Aston Martin contracted prototyping latest

luxury sports car to an Indian-baseddesigner.

Suzuki & Hyundai India set to make Indiaglobal small car hub

Ford presented Gold World ExcellenceAward to India's Cooper Tyres.


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Success is Infectious

World Largest:

Bharat Forge - single-location forgingfacility

Hindustan Inks - single stream fullyintegrated ink plant

Essel Propack - laminated tube

manufacturer

And many more..


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India Everywhere!!

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