1. Project Hination
Team Hination
Faculty Mentors: Prof Sapna Malya (Dr.) Prof Ravi Vaidee
Student Team Ashish K Nainan Gaurav Verma Mayank Jain Swapneel Raut
Explore India Opportunity - Manufacturing & Distribution of Solar multi-purpose devices.

2. INDEX
1. Executive summary
2. Introduction
3. Market overview
- Macro-economic - Market intelligence
- Product - Demand & Supply
4. Primary Research
- Problem statement
- Research design
- Sampling
- Data collation
- Data analysis - Inferences - Limitations
5. Conclusion 6.Suggestions
7. References

3. Executive Summary
Solar portable device market is in its nascent stage of development in India with most manufacturers finding it difficult to find a market with sustained demand for these products.
It is extremely important to explore alternate ways of promoting them as an essential product rather than a utility and more importantly as a sustainable & cost effective alternative to any other form of renewable energy.
The Indian market could be segmented into two distinct markets viz. Urban & Rural and Solar renewable energy as a core offering does provide a huge opportunity to both segments, each offering a different set of challenges even while offering an exciting opportunity.
Rural markets though still are an untapped arena for most businesses in India but at the same time, for products like HiLight, it is equally difficult to percolate into the minds of people for the features it provides at the given price and more so as majority of the rural markets are yet striving to meet both ends.
These markets are always looking for products of high value and they want the maximum benefit at the least price – Today’s Indian Rural consumer is looking for an Urban product at Rural price.
On the other hand, in the urban markets, the higher disposable income and better lifestyle is pushing people, though small in numbers, to contribute in their own way for environmental sustainability and hence they are looking for products which help them in this direction.
With the urban professional on the move at all times, they are always looking for products which are portable and have a wide range of use. They are ready to pay a premium for quality products and this is evident from the fact how luxury retail segment in the country has grown manifold in the last one decade.
But for products like HiLight, there is always a market which remains unchanged irrespective of the market conditions and tastes. India Inc today understands the need to preserve the nature through its Corporate Social Responsibility Activities, making huge contributions towards using greener solutions for the ever growing energy needs.
Companies who have forayed into green solutions are yet to understand the need to tap the needs of this segment of consumers and make products that suit their needs. Corporate houses thus form a major part of market for this segment of products since they look at providing simple solutions for the less noticed problems and hence, are eager to spend extra for products that genuinely address their immediate needs.
Also the Government of India is supporting renewable energy products with their conducive policies which could be utilized well in order to boost the profitability of firms who foray into this segment.
Thus it is very clear that the the markets mentioned above are fragmented but taken together would form a very huge eco-system for any business and hence help it achieve sustainability.

4. In summary, the Indian market is a great opportunity for Hi Nation should they wish to enter with a long term Vision and goal. Our recommendation would be for Hi nation to identify a Strategic partner, ideally Corporate, high on Corporate Social Responsibility and who share a similar Vision on “Go Green” initiatives and over a period build a strong base in India and working out of India viz Indianise the offerings to suit Indian diverse customer segments needs, even while accomplishing Hi Nations business Goals. INTRODUCTION
The solar portable power system market is in its budding stage in India with a penetration mainly concentrated in rural households which are still away from the main power grid of the country. A government report suggests, out of 28 states (as on 1st January 2014), 19states are yet to achieve 100% electrification. The major cause being a deficit of electricity generation mainly due to over dependence on coal based and hydroelectric electricity generation. The country currently has a power deficit of 5-8% annually.
Starting 2005, the Ministry of New and Renewable Energy Resources started looking for alternate energy resources since India has already reached optimum level of wind energy generation. Thus the potential and role of solar energy was evident henceforth. Solar energy currently constitutes 2.64GW (1%) of the total energy generation in India and by 2020, the Government has the plans to ramp it up to 19GW.
In the meantime, the penetration of mobile phones and similar products in the rural un-electrified markets led to few Government agencies and NGO’s rethink their strategies. Thus the need for a portable charging device for these gadgets came into picture. Though the solar product development had started back in 1995 in India, mainly concentrating on grid contribution, water heaters and cookers, the portable charger device market saw its first device in 2007 by Green Light Planet which was started by a group of researchers who built a prototype product for rural people in Orissa.
Currently the market size for portable solar lantern-cum-chargers is 50000 units per annum, which is mainly concentrated on buyers in the rural areas in Bihar, Karnataka, Maharashtra, Madhya Pradesh, Orissa, Gujarat, Tamil Nadu, etc and includes both retail as well as Corporate consumer purchase. Though product market in the lantern segment is still very scattered with lanterns made by assembling raw materials by NGO’s and the product price is as low as € 8 for a lighting unit of 2 watt. The solar charger segment has few organized companies like Green Light Planet and SIDCO, mainly have their production units based in China which minimizes cost of production and at the same time provides them with huge production capacity. The prices for these products lie in the range of € 24.5 and with increase in demand, the prices may fall sharply in the future. Mountaineers, Trekking teams, Frequent Travelers, Use in Automobile, Outdoor & Marketing persons, rural areas with power problems are their main markets.
Companies manufacturing solar products in India avail a chance of being given subsidy for production by the Government to promote solar equipment manufacturing.

5. Hination with its product “Hi-light” has the potential to provide an upgrade to consumers of existing similar portable solar lanterns with its benefit of high quality-rugged build and lighting cum charging of numerous portable devices. The device could be useful in both rural markets as well as the urban segment who are looking for a great way to contribute to the environment. MARKET OVERVIEW
The market as of now is clearly scattered with very few prominent big names mainly due to non- consolidation of demand for solar products. There are no markets well defined for a particular kind of products due to which the sales of these products currently are non-uniform across all products categories. Solar products sales are mainly done through door to door marketing and through Government or NGO channels where in the products are freely distributed by large corporate houses for the benefit of poorly developed/rural areas or sold to the final consumer on very subsidized rates mainly due to their benefits in un-electrified villages. The annual demand through retail stores/e-commerce sites/dealership is still very marginal, which is currently pegged at less than 10000 units a year (mainly solar chargers). Also there were few products, specifically mobile phones which had in built solar panels and they have done marginal well, but were not well received since, the recharging efficiency of the products €were not up to the mark and hence the products failed to gather major momentum. Few companies namely LG, Micromax had come out with solar chargeable phones with basic features in the price range of € 30 to € 50. Another important factor to note is the presence of China in the global market as a manufacturer of solar devices with it capturing almost 75% of the global markets for supply of raw materials as well as finished goods. China has been able to produce these products at extremely competent prices with the help economical and efficient manufacturing methods and low labor costs. Macro-economic factors: Key Drivers: - Cost reduction is achievement of economies of scale - Technological advancement - Emergence of low cost manufacturing locations. The key driver of the growth of this sector is the concept of Grid Parity. This refers to the point when the cost of the solar power equals the cost of conventional power. It is expected that the solar tariff to lie anywhere within this band depending on the bargaining power of the developers. And India will reach its grid parity by 2019-20 Political The government has huge presence in the Solar Energy market. It regulates the market through MNRE (Ministry of Renewable Energy) and financial assistance is provided by IREDA (Indian Renewable Energy Development Agency Limited). One of the eight missions under the NAPCC

6. is the Jawaharlal Nehru National Solar Mission (JNNSM) which was launched in late 2009. The mission targets 22,000 MW of solar power generation. The Indian Renewable Energy Development Agency (IREDA) has come up with several schemes to not only encourage the use of solar-powered systems, but also facilitate businesses in the arena. It has come up with a four- point financing model based on corporate, co-operative, NGO and dealer mechanisms for benefiting end-users and entrepreneurs alike. The PV Pumping Program provides opportunities for startup financial and solar companies to act as intermediaries for offering solar products to rural users under specific leverage schemes to combat the high cost of initial setup. Companies engaged in R&D in solar power are also offered several subsidies and tax exemptions. Economic: India is the 10th largest economy in the world with a GDP of $1.8 trillion and a forecasted growth of 5.5% for the year 2015. India is an agrarian economy and almost 40% of the GDP is constituted by agriculture and its products. Post liberalization in 1991, the country has witnessed an average annual growth of 4%. The country has witnessed a manifold growth of GDP in the last decade and this has led to the overall improvement in economic condition of the people of the country. The Government in order to improve the overall standard of living has been coming up with schemes and subsidies for financial inclusion across all sections of the society. Post 2008, the Government has been able to give enough financial stability to the rural people though rural employment schemes which improved the overall disposable income across the common people in rural areas. In terms of purchasing power parity (PPP), India ranks 3rd in the world over developed countries like Japan. With India being a favored destination for major investors across the globe and is steadily growing to become a Global Financial Centre. Social: The social dynamics in the country have changed drastically in the past two decades. Before 1991, India was a closed economy, which meant slow growth; and with lesser disposable income, people had less choices which were confined to few products available. People were less aware about the global changes in the field of science and technology and products across the globe. Post liberalization, the market opened up to international brands which slowly caught up with the imagination of the people of the country. Therefore, there was a stark contrast between the two generations, with the former being less exposed to global standards and lesser exposure to technological innovations. Instances like the telecom boom in the country, added almost 900 million subscribers to mobile telephony in the period 2000-2014 - an outburst of technological inclusion. Today, the present generation is well-versed with technology and global products and this is going to improve further improving the benchmarks. Legal and Regulatory:

7. A major catalyst for solar product manufacturers could be the mandatory 2% contribution of profits by corporate houses towards CSR. Government of India has made it mandatory for companies to contribute a part of their profits for the welfare of the weaker classes and upliftment of the society. This means the companies who were spending a small amount would have a larger budget when it comes to CSR. The major hurdle for companies venturing into solar energy is the following two conditions that are set down by the Government for them in order to create investment and employment: Any company looking forward to avail benefits under the National Solar Scheme has to make a minimum of 75% of the investment inside the country itself. Thus companies having no manufacturing base inside the country won’t be covered under this scheme. Secondly, the products that could avail subsidy to be distributed among the beneficiaries, are supposed to have specification that are prescribed by the Ministry of Renewable Energy. For companies that are importing products in completely assembled form may avail no tax rebate or subsidy benefits. Companies who are into export of solar equipments could further avail to tax benefits as a part of forex generation incentive. Technology India as a country has a huge population for which meeting the infrastructural and technological needs is a huge task in itself. Almost 33000 villages in the country are yet to be electrified and more than hundred thousand villages don’t have access to basic amenities like schools, hospitals, potable drinking water etc. Given these challenges, the country faces an acute shortage of funds mainly due to slow growth in the manufacturing sector and huge dependence on fossil fuels for meeting its energy needs which are mostly imported which forms a major part of the Government spending. India has seen a sudden growth in technology in the field of Aerospace, Telecom, Manufacturing, Information Technology, Automobile etc post 2000 and the Government of India has been instrumental in further developing them same by promoting research in these fields, especially by setting up specialized research institutions in these fields and also collaborating with foreign countries and institutions who have specific expertise in areas of science and technology. The country has progressed drastically in the past decade in areas of Information technology and is leader in various segments.
Market intelligence Companies which are directly selling products similar to Hination Hi-light are Green Light Planet and Om Energy savers. Green Light Planet was established in 2007 by by T. Patrick Walsh, a University of Illinois student who spent part of 2005 working with the charity Engineers without Borders in rural India and Mayank Sekhsaria and Anish Thakkar.

8.  630 Fulltime Employees
 Available in 30 Countries
 Over 100 distribution partners  Own distribution channel, Direct to Village, a concept like insurance agents.
 2,90,000 tons of carbon credits
 Has mostly targeted rural households and has been able to successfully tap the market without depending on subsidies.
 Price range € 8 for lighting and € 29 for lighting with USB option.
 150000 household have Sun-king, another portable solar lighting solution sold in the last one decade.  Manufacturing facility based in China- completely produced out of the country.
With over half a dozen products in its portfolio, the company has been able to rural markets in states like Orissa, Jharkhand and Chhattisgarh. Company has received many awards from international organizations like IFC and World Bank for its product innovation and innovative distribution system. Green Light Planet is looking to scale up its operations to many more states in India. The company is also looking to expand to African and South Asian countries in the time to come.
Om Energy Savers is based in Mumbai with its manufacturing facility in Byculla, Mumbai. The company has a mix of portable devices ranging from portable lanterns and mobile chargers to other day to day electricity saving devices. The company currently has its own network of distributors and focuses on retailing by tapping corporate. It has tie-up with more than 35 top companies in the country and supplies them with their products for CSR activities. The company has a production capacity of 25 pieces per day currently to meet the current market requirement and in case of bulk orders, the company imports products from China. Its portable devices are priced in the range of €12 -23. The company produces based on its orders from bulk buyers who independently order for products according to their requirements. Tantra International, incepted in the year 2007, are well established manufacturer, trader and supplier of an extensive range of Solar Products. The superior range of products they offer are procured from certified vendors in the market and finds wide application in various industries. They also provide customized solutions to their clients and carry out turnkey projects as well. Their organization is supported with advanced infrastructure facility along with an R&D centre. They also have huge and capacious warehouse, which is located near by JNPT Port, Navi Mumbai (India). The company has a portfolio of over 19 products ranging from LED streetlights, home appliances like solar invertors, to portable mobile phone chargers and LED lighting system. The product range is between € 12-29 for portable charging and lighting devices.
Demand:

9. Though an exact demand for these kind of products couldn’t be estimated given the scattered market and low penetration of product awareness among the masses, but currently data from surveyed companies indicate around 12000 pieces an year. This is mainly for products which have a dual feature of mobile charging and LED lamp. Supply: Currently, most of the manufacturers have a smaller manufacturing base and they import in case of a higher demand for a specific category of product which is rather rare. Major demand arises for huge Solar panels which are imported and assembled according to requirement. China is the single largest supplier of solar products in India given their economical and efficient cost of production. Almost, 75% of the assembled as well as solar components available in the market are constituted by Chinese products. Primary Research Problem statement: Explore India Opportunity - Manufacturing & Distribution of Solar lighting and charging devices. Research design The surveys were mostly conducted through telephonic interviews followed by verification of the data by sending their replies through emails. The questionnaires were designed in such a manner that they were easy to understand. Questions asked were open ended since most of the questions intended to know their experience and views and about which we had no prior knowledge. This survey has been conducted to broadly understand the following: 1.Demand and supply for the products. 2. Prevailing revenues and margin levels. 3. Major factors contributing to consumer buying behavior Sampling and Data collation The manufacturers surveyed are doing a triple role of manufacturing, distributing and selling of their own products. The questions asked were based on the operational order of a manufacturing company starting from: 1.Setting up a plant, 2. Research on the part of the company to improve the product efficiency 3. Operating efficiency of the manufacturing unit 4. Procurement of raw materials by a company and economical sources. 5. Manufacturing of the products and supplying finished goods 6. Providing after sales services.. With most of the manufacturing plants having a research and development facility, the manufacturers have evolved their products with time to suit the requirements and tastes of the

10. consumers. Data Analysis Company name Tantra international Hindustan instruments Om Energy savers Metalwork Ltd. Unique Enterprises Capacity(per annum) 20000 20000 10000 Not disclosed Not disclosed Price Range € 18.5 onwards € 25 onwards € 15- 35 € 12 onwards € 18.5 onwards. Operating margins 20-25% 30% 25-35% 18%-20% 20% Exports Asia and Africa Africa, Europe, America NA No No Raw material imports Not disclosed. Not disclosed Bulk order over 500 pieces. Bulk orders over 500 pieces. Not disclosed. After sales Unorganized Yes No No No Manufacturing defects 4% 4% 6-8% 2% 5% Raw materials In house and outsource solar panels In-house. Assemble outsourced raw materials Imported Imported panels, electronics- in-house. Promotion No No No Online Online Warranty period 2-3 years 2-3 years 1-2 years. Not Disclosed 2years Major consumers Government agencies, NGO’s and rural markets. Government agencies, Corporate, NGO’s and rural markets. Corporate, and NGO’s. On bulk orders On bulk order R & D Facility Yes Yes No Yes No Plant location Mumbai Mumbai Mumbai Mumbai Mumbai Warehouse facility Yes Yes Yes No Yes Distributor channel Own Own Own JIT JIT

11. Inference Majority of the manufacturers supply their products domestically to customers in Uttar Pradesh, Rajasthan, Tamil Nadu, Karnataka, Bihar, Haryana and Madhya Pradesh. It is mainly due to lower electrification in rural areas and most of these areas have less rainfall and thus solar energy can be depended upon for their energy requirements. Major part of this demand is from the rural areas in these states and manufacturers have mentioned specifically said that most of their products are used by consumers from the rural markets. Since urban areas in the country are electrified and have an above average supply of electricity round the year, there is very less demand for products from the urban markets. All the companies mentioned above prefer importing their raw materials as parts from China as much as twice their production capacity and assemble and distribute the final products, as it is more cost effective than producing the products in house. Few vitals inferences as an outcome of this survey: Buying behavior of consumers for these products is on based on these factors with priorities in the same order for rural markets. - Price of the product. - Service duration - Ease of handling and maintenance - Warranty of product - After sales service - Quality of the product Though for the urban markets, other than price, the quality also forms an important part of the decision making. The production for solar products happens round the year except in the rainy season when the demand for the product is almost nil across the markets. Hence the manufacturers mostly use this time for the maintenance of their plants. All the manufacturers clearly indicated that there are no advertising or marketing strategy currently used by them and hence, there is no spending on advertisements on promotion of the product. Due to scattered product distribution, the after sales service for these products is almost nil.
Conclusion The following could be concluded from the above study. Though the market is fragmented, there is a steady demand for these products given the different types of consumer segments; starting from corporate houses to rural mass markets, but they are not properly tapped by manufacturers. There is adequate production capacity to meet the

12. immediate future requirements of portable solar lighting devices. Most of these production capacity are based in and around huge port cities due to easy accessibility to logistics, thus for easier export-import. Basic raw materials like solar panels are still imported which underlines the need for more expansion in this regard. Research facility set up by these industries in the country to further improve on their products is are insufficient to meet the global standards. The operating margin for products in this industry are sufficient enough for businesses to sustain given they are able to cater to a wide customer base for steady demand. Also, benefits from Government like Tax rebates on domestically produced solar products and subsidies for solar products could further improve the financials. This is a major factor as pricing plays a major role in the demand of solar products as the market for these products is still developing and consumer attitude towards them won’t change given the cheaper alternatives available with the same utility. On the other hand, urban market are less price sensitive and are ready to pay a premium for high quality products; given that they serve their multiple needs along with portability. After sales service is where this industry takes the maximum beating due to scattered consumers and hence the industry needs to device a way to provide proper after sales service for solar products.
Distribution and vendor network is under-developed given the low demand from end-users and since, distributors who are profit centric, consider this a less lucrative product segment for their business.
Finally, these products are not promoted and advertised by the companies and hence, companies need to make the consumers aware about their products to make them sell.
Limitations Views mentioned above are solely of executives from manufacturing plants and may not actually reflect the market sentiments. All the surveyed companies are based in and around the Metro city Mumbai and thus, the facilities and other facts mentioned may vary from region to region. The survey only takes into account products which fall under the category of either lighting/charging or both. Suggestions The Company Hi-nation could look at the following suggestions while taking decisions before entering Indian market.
 India as a manufacturing hub could well be the answer to produce high quality products with cheap availability of raw materials, labour, easy accessibility of ports for logistics and a huge market. Hination has to gradually look at creating a sustained demand by tapping corporate

13. buyers and exports and there-on shifting their focus to individual buyer markets in the urban segment and then finally the rural markets. The company to meet its production need could tie up with manufacturing facilities across the country who have the requisite expertise in manufacturing these products and are willing to scale up if the need arises at all. Thus the combination of technology from Hination and manufacturing facility of Indian manufacturers could be fruitful on a longer run. In the process, with higher production, Hination would be able to decrease the prices of its products to the levels of existing products in the market.
 The company needs to look at having a different approach of marketing their product, starting with a B2B approach and gradually shifting their focus to B2C once they are able to capture a substantial part of the first segment. B2B marketing is more specific as compared to B2C and at the same time provides the company with bulk orders to there on reach a break even.
 Exports are equally important and South East Asian and African countries have trade agreements with India and combined with subsidies and benefits could further improve the margin for the company. Also they provide an even bigger market with the African nations yet not being able to achieve even 50% electrification leading to higher demand for these products in those markets.
 The company needs to have a proper after sales service and has to work on a strategy right from the beginning as any short-coming in this front would make it similar to other existing products.
 Hination could consider tying up with e-commerce portals to reach the urban buyers initially, thus saving a lot of cost on developing a distribution network till they decide on promotion of products. Tying up with NGO’s and Other such organizations and promoting HiLight on social networking sites is a cheap source of promotion initially and the urban crowd could be reached easily through this,
 Price of the product has to be priced more aggressively in the beginning.

14. Special thanks to Tantra international: Mumbai Om Energy Savers, Mumbai Hindustan instrument Mumbai and all other vendors and distributors for their valuable input and co-operation. Currency conversion: 1 € = Rs. 81.13