Global Market Research Report : Telecom equipment market in india 2014

Telecom Equipment Market – India
April 2014

2TELECOM EQUIPMENT MARKET IN INDIA 2014.PPT
Executive Summary
Drivers:
Market
Overview
Drivers &
Challenges
Market Trends
Competitive
Landscape
 As per 20-- - --, telecom equipment worth INR X1 bn was consumed in India
 Mobile handsets account for around Y% of the total telecom equipment industry in India
 Telecom equipment import have grown at a CAGR of around Y2% between 20-- and 20--
Telecom Equipment Certification
Android Smartphones and Tablets
Strengthening of R&D
Infrastructure Sharing
Challenges:
Major Players
Company A Company B Company C
Company D Company E Company F
 Security Concerns
 High Telecom Equipment Imports
 Growth in Wireless Subscriber Base
 Next Generation Voice and Data Services
 Government Initiatives and Progressive
Reforms in the Industry
 IPv4 to IPv6 Migration

•Economic Indicators
•Introduction
•Market Overview
•Drivers and Challenges
•Market Trends
•Competitive Landscape
•Strategic recommendation
•Appendix

4
Economic Indicators (1/3)
11
12
13
14
15
b2
a2
Q1
d1
c1
b1
a1
Q4
c4
b4
a4
Q3
c3
b3
a3
Q2
d2
c2
INR tn
2013-142012-132011-122010-11
GDP at Factor Cost: Quarterly
Inflation Rate: Monthly
-2
-1
0
1
2
q
Jul 2013 - Aug 2013
p
%
Nov 2013 - Dec 2013
t
Oct 2013 - Nov 2013
s
Sep 2013 - Oct 2013
r
Aug 2013 - Sep 2013
TELECOM EQUIPMENT MARKET IN INDIA 2014.PPT

Introduction
Telecom Equipment - Overview
• Economic and social development of India is significantly influenced by its telecom industry
• Modern and robust telecommunication systems demand state-of-the-art telecom equipment
• Cellular network technology such as 3G and 4G, broadband internet services, telephony services, network
requirements and other telecom products and services has led to increased demand for telecom equipment
Telecom
Equipment
• Telecom equipment can be broadly classified into Segment 1, Segment 2 and segment 3
• Alternatively, it can also be classified into two categories in terms of type of consumer
• In category 1, fixed and mobile switches, base stations, routers, & transmission equipment largely represent Type 1,
whereas towers, shelters & cables falls under Type 2
Category 1
Category 2
Type 1
Type 2
Type 3
Type 1
Type 2

Significant demand exists for telecom equipment in India
but it is being TextText TextText by TextText TextText
Market Overview – India (1/5)
•Growth in telecom sector has enabled telecom equipment companies to flourish in India, regardless of passive or
active telecom infrastructure, or mobile devices
• While majority of the domestic telecom equipment companies started off as resellers of telecom products made by foreign
companies, the focus is gradually shifting to domestic production
•As per 20-- - --, telecom equipment worth INR X1bn was consumed in India
•Mobile handsets account for around Y1% of the total telecom equipment industry in India
• Despite competition from foreign handset giants such as Apple, Samsung and others, domestic companies such as Micromax, Lava
and Karbonn Mobiles, among others, have come up with innovative handsets and Tablets at affordable price
•Chinese and European telecom equipment products dominate the market in India at present
x3
x2
x1
x
INR bn
Y%
2017e
a5
2016e
a4
2015e
a3
2014e
a2
2013
a1
Telecom Equipment – Market Size & Growth Telecom Equipment – Domestic Consumption
X%
Y%
qp
Note: Data available from TRAI till 2010

Market share for Segment 3 and Segment 2 is expected to
grow significantly over the coming years
Market Overview – India (5/5)
x3
x2
x1
x
2018e
a5
2017e
a4
2016e
a3
2015e
a2
2014e
a1
INR bn
Z%
Segment 3 – Market Size & Growth
x3
x2
x1
x
INR bn X%
2018e
a5
2017e
a4
2016e
a3
2015e
a2
2014e
a1
x2
x1
x
a4
2017e2015e 2016e
INR bn
Y%
a5
2018e
a3a2
2014e
a1
•Segment 2 is expected to capture higher market share by 20-- among the three segments
•Staggering number of mobile devices, explosion of video traffic, expanding business and mission-critical
applications, cloud-based application virtualization, and service delivery requirements are the prime factors
fueling the demand for Segment 2

Drivers & Challenges
Drivers
Growth in Wireless Subscriber Base
Next Generation Voice and Data
Services
Government Initiatives and
Progressive Reforms in the Industry
IPv4 to IPv6 Migration
Challenges
Security Concerns
High Telecom Equipment Imports

Country’s wireless subscriber base looks promising due to
present opportunities and future potential
• Currently, India has a substantial wireless subscriber base that is growing at a rapid pace
 As of Sep 20--, total wireless subscribers base touched x1 mn as compared to x2 mn in Jun 20--
• It has been observed that Indian states with the highest commercial activity and business
operations possess higher wireless subscriber base as compared to rest of the states
• Growth in the subscriber base creates requirement of telecom equipment which ensures
services can be provided in best possible manner
• Also, with falling prices of mobile devices, popularity of end-user telecom equipment is also
rising significantly
Growth in Wireless Subscriber Base
x5
x4
x3
x2
x1
x
x6
X%
2016e
a2
2013*
a1
mn
Wireless Subscriber Base – India
Impact
* Data as of month1 20--

10
SAMPLE
Market Trends (1/4)
• TextText TextText TextText TextText TextText TextText TextText TextText TextText TextText
TextText TextText
TextText TextText TextText TextText TextText TextText TextText TextText
Telecom Equipment
Certification
Android
Smartphones and
Tablets
• TextText TextText TextText TextText TextText TextText TextText TextText TextText TextText TextText
TextText TextText TextText TextText TextText TextText TextText
• TextText TextText TextText TextText TextText TextText TextText TextText TextText TextText TextText
TextText TextText TextText TextText TextText TextText TextText

11
Porter’s Five Forces Analysis
Competitive Rivalry
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ext Text Text Text
Bargaining Power of Buyers
• Text Text Text Text ext Text Text
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Text Text ext Text Text Text ext
Text Text Text ext Text Text Text
Threat of New Entrants
Text Text Text Text ext Text Text
Impact
X
Impact
X
Impact
X
Bargaining Power of Suppliers
Impact
X
Threat of Substitutes
Impact
X

12
Competitive Benchmarking (1/5)
Public Trading Comparables
Company A Company B Company C Company D
Market Capitalization (INR mn)
Share Price (INR)
EV/EBITDA (x)
EV/Revenue (x)
PE Ratio

13
Key Ratios of Top 2 Companies – Operational Basis
Competitive Benchmarking (4/5)
x5
x4
x3
x1
x
Company B
a2
Company A
a1
Asset Turnover Ratio
• Company b has consistently recorded higher debtors turnover ratio than its peers for FY1 and FY2
• Company a recorded the highest asset turnover ratio of y1 followed by Company bwhich recorded asset turnover ratio
of y2
x4
x3
x1
x
Company B
b2a2
Company A
b1a1
20--20--
Debtors Turnover Ratio

14
Key People
Products and Services
Company Information Offices and Centres – India
Corporate Address
Tel No.
Fax No.
Website
Year of Incorporation
Ticker Symbol
Stock Exchange
Category Products/Services
Electrical
components
Equipment
Name Designation
Person 1 Chairman
Person 2 Managing Director
Person 3 Director
Person 4 Additional Director
New Delhi
Public: Domestic Company – Company A
(1/4)
Head Office

15
Financial Snapshot Key Ratios
Financial Summary
• The company earned a net profit of INR ‘d2’ bn in FY 20--, as compared to
net profit of INR ‘c2’ bn in FY 20--
• The company reported total income of INR ‘d1’ bn in FY 20--, registering an
increase of ‘p’% over FY 20--
• It earned an operating margin of ‘x.x’ per cent in FY 20--, an increase of ‘y.y’
percentage points over FY 20--
• The company reported debt to equity ratio of ‘w.w’ in FY 20--, an increase
of ‘z.z’ per cent over FY 20--
Key Financial Performance Indicators
Indicators Value (dd/mm/yyyy)
Market Capitalization (INR mn)
Total Enterprise Value (INR mn)
EPS (INR)
PE Ratio (Absolute)
Particulars
y-o-y change
(20-- – -- )
20-- 20-- 20-- 20--
Profitability Ratios
Operating 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 Ratios
Operating costs (% of Sales)
Administration costs (% of
Sales)
Interest costs (% of Sales)
Liquidity Ratios
Current Ratio
Cash Ratio
Leverage Ratios
Debt to Equity Ratio
Debt to Capital Ratio
Interest Coverage Ratio
Efficiency Ratios
Fixed Asset Turnover
Asset Turnover
Current Asset Turnover
Working Capital Turnover
Capital Employed Turnover
Improved Decline
c1
(2/4)
Net Profit/LossTotal Income
y4
y3
y2
y1
y
x4
x3
x2
x1
x
2012
c2
c1
2011
b2
b1
2010
a2
a1
INR mnINR mn
2013
d2
d1

16
Key Business Segments Key Geographic Segments
Business Highlights
x2
x1
x
2013
c4%
b4%
a4%
2012
c3%
b3%
a3%
2011
c2%
b2%
a2%
2010
c1%
b1%
a1%
Segment 3Segment 2Segment 1
Description News
Overview
• Company A is a part of the Company 1Group established in collaboration with globally renowned ,
Country 2-based Company 2
• The company manufactures generators, multipurpose engines, chemicals, yarns, pipes, consumer
durables, precision cutting tools etc.
• Company A got ISO 9002 certification in Month 19--, and has also been awarded ISO 14001 certification
Collaborations
• Company A collaborated with Company 3 for manufacturing of diesel generators with Company 3 brand
of Engines
Expansion Plans • The group is planning to diversify and enter the IT industry
x2
x
x1
2013
100%
Region 1
Region 1 is the only geographic
segment in which the company
has been operating for the
past five years
(3/4)

17
Public-Domestic Company: Company A – SWOT Analysis
(4/4)
TO
WS

18
Key People
Products and Services
Company Information Offices and Centres – India
Corporate Address
Tel No.
Fax No.
Website
Year of Incorporation
Private-Domestic Company: Company B. (1/5)
Head Office
Category Products/Services
Products
Mumbai
Name Designation
Person 1 Chief Financial Officer
Person 2 Head of Project
Person 3 Whole Time Director

19
Private-Domestic: Company B. – Shareholding Pattern (2/5)
Ownership Structure
Note: Shareholding pattern as on AGM dated 29th Sep 2012
X%
Y%
X segment Y segment

20
Financial Snapshot Key Ratios
Particulars
y-o-y change
(20– – --)
20-- 20-- 20-- 20--
Profitability Ratios
Operating 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 Ratios
Operating costs (% of Sales)
Administration costs (% of
Sales)
Interest costs (% of Sales)
Liquidity Ratios
Current Ratio
Cash Ratio
Leverage Ratios
Debt to Equity Ratio
Debt to Capital Ratio
Interest Coverage Ratio
Efficiency Ratios
Fixed Asset Turnover
Asset Turnover
Current Asset Turnover
Working Capital Turnover
Capital Employed Turnover
Improved Decline
Financial Summary
• The company incurred a net loss of INR –’d2’ mn in FY 20--, as
compared to net profit of INR ‘c2’ mn in FY 20--
• The company reported total income of INR 1,529.9 mn in FY
20--, registering an increase of 0.34% over FY 20--
• The company earned an operating margin of ‘x.x’% in FY 20--, a
decrease of ‘y.y’ percentage points over FY 20--
• The company reported debt to equity ratio of ‘w.w’ in FY 20--,
a decrease of ‘z.z’% over FY 20--
Net Profit/LossTotal Income
y4
y3
y
y2
y1
x3
x2
x1
x
a1
INR mnINR mn
2013
d2
d1
2012
c2
c1
2011
b2
b1
2010
a2
Private: Domestic Company – Company B
(3/5)

21
Private-Domestic Company: Company B (4/5)
Key Information
Description Details
Overview
• Company B provides passive telecommunication infrastructure in India
• It was formerly known as Company B1. and it operates as a subsidiary of B3
• The company builds, owns, and operates telecommunication towers, optic fiber cable
(OFC) network, and related assets; and provides these passive infrastructure assets on a
shared basis to wireless and other communications service providers, as well as to non-
communications customers under long-term contracts

22
Private-Domestic Company: Company B – SWOT Analysis
(5/5)
TO
WS

23TELECOM EQUIPMENT MARKET IN INDIA 2014.PPTTELECOM EQUIPMENT MARKET IN INDIA 2014.PPT
Strategic Recommendations (2/2)
•Leverage on location based services mandate by the Government of India with various telecom
equipment
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Telecom Equipment for Location Based Services
Accuracy
(Meters)
Urban Area Suburban and Rural Area Remote Area
20-- 20-- 20-- 20-- 20-- 20-- 20--
50 X% X% X% X% X% X% X%
100 X% X% X% X% X% X% X%
300 X% X% X% X% X% X% X%
500 X% X%. X% X% X% X% X%
Accuracy Mandate in Percentage

24
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Telecom Equipment Market – India 2014 report is a part of Netscribes’ Technology Series.
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Global Market Research Report : Telecom equipment market in india 2014

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Global Market Research Report : Telecom equipment market in india 2014