industry cursor december 2011

7/30/2019 Industry Cursor December 2011

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cursorIndustry

Issue 40 December 2011

CONTENTSStrictly for Private Circulation

Highlights

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India's GDP grew by 6.9% (y-o-y) during the second quarter ended Sep-11. The agriculture,

industrial and services sectors registered y-o-y growth of 3.2%, 3.2% and 9.3%

respectively.

The Index of Industrial Production (IIP) declined by 5.1% (y-o-y) during Oct-11, it being the

first time since Jun-09. The IIP had grown by 11.3% during Oct-10.

The manufacturing sector contracted by 6.0% (y-o-y) during Oct-11 as compared to a

growth of 2.4% during Sep-11. The mining sector declined by 7.2% (y-o-y) during Oct-11,

after a decline of 7.0% during Sep-11.

The capital goods sector declined significantly by 25.5% during Oct-11 after declining by

6.5% during Sep-11. The consumer goods segment also declined by 0.8% (y-o-y) during

Oct-11 as against a growth of 4.3% in Sep-11.

Aggregate deposits increased by 18.2% (y-o-y) as on November 25, 2011 as compared to

increase of 14.1% during the same period of the previous year.

Bank credit increased by 17.6% (y-o-y) as on November 25, 2011, as against a growth of

22.7% in the same period of the previous year.

The foreign exchange reserves stood at US$ 306.8 billion as on December 2, 2011, as

compared to US$ 320.4 billion as on October 28, 2011.

MACROECONOMIC UPDATE

Cement

Commercial Vehicle

Gems & Jewellery

Hi-Tech

Banking

Hospitality

IT-Hardware

Passenger Vehicle

Textile & Garment

Steel

Retail

Pharmaceutical

Two and Three-Wheeler

2

4

5

7

6

8

3

9

10

11

15

14

13

12

Macroeconomic Update

Auto Components

E: D&B estimateSource: CSO, D&B Industry Research Service

IIP and core infrastructure: Growth (%)GDP: Growth (%)

Source: Ministry of Commerce and Industry, CSO

Macroeconomic triad (forecast)

Note: Exchange rate: INR/US$Interest rate corresponds to yield on T-Bills 15-91 daysSource: D&B Industry Research Service

Source: Ministry of Commerce

Dec-11

India's exports & imports (US$ bn)

Inflation8.3% - 8.5%

Interest rate8.6 - 8.8

Exchange rate52.3 - 52.6

Eight core infrastructure IIP-10

-5

0

5

10

15

Oct-10

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Exports (LHS) Imports (RHS)

Oct-10

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

10.0

15.0

20.0

25.0

30.0

35.0

Agriculture Industry Services GDP at factor cost

0

2

4

6

8

10

12

Q2 FY11 Q3 FY11 Q4 FY11 Q1 FY12 Q2 FY12 Q3FY12 E


2/16

Highlights

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Auto component major Bosch Ltd plans to invest `2.0-2.5 billion in the next three

years to expand its aftermarket business. This will include ramping up of car

service centres to 750-800 outlets from the current 500 across the country.

Magneti Marelli, the Fiat Group's auto component arm entered into an equal joint

venture with Talbros Automotive Components Ltd (TACL) for manufacturing

suspension systems and modules. The new venture is expected to be operational

by April 2012 and will manufacture various components including control arms,

knuckles, front axles and rear axles for automobile applications.

The auto components industry recorded double-digit growth in net sales for the

September 2011 quarter. On the profit front, the industry recorded slowergrowth as compared to the September 2010 quarter. As a result, profit margins

shrunk, though marginally.

AUTO COMPONENTS INDUSTRY

Steel prices (Mumbai) (`/tonne)

Industry: Key financial indicatorsRubber prices* (Kottayam)

(`/quintal)

Source: CMIE

*Rss-4Source: CMIE

Note: Operating profit: PBDIT net of prior period and extra-ordinary items (P&E); Net profit: PAT net of P&ESource: CMIE

HR coils 2.0 mm CR coils 0.63 mm

Industry: Profit margins (%)

Note: Operating profit: PBDIT net of prior period and extra-ordinary items (P&E); Net profit: PAT net of P&ESource: CMIE

No

v-10

De

c-10

Ja

n-11

Fe

b-11

Ma

r-11

Ap

r-11

Ma

y-11

Ju

n-11

Ju

l-11

Au

g-11

Se

p-11

Oct-11

No

v-1140000

42000

44000

46000

48000

50000

10000

12000

14000

16000

18000

20000

22000

24000

26000

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

Parameters Units Q2FY11 Q3FY11 Q4FY11 Q1FY12 Q2FY12

Net sales `bn 126.0 132.2 146.2 141.7 148.5

y-o-y growth % 38.0 33.0 32.9 23.9 17.0

Operating profit `bn 19.0 19.6 21.4 20.9 21.3

y-o-y growth % 31.2 28.4 22.7 22.8 11.4

Net profit `bn 8.0 8.0 9.7 9.0 8.7

y-o-y growth % 47.6 48.2 55.7 33.8 7.3

Operating profit margin % 14.8 14.6 14.3 14.5 14.1

Net profit margin % 6.3 6.0 6.5 6.3 5.8

0.0

2.0

4.0

6.0

8.0

10.0

13.0

13.5

14.0

14.5

15.0

15.5

Q2FY11 Q3FY11 Q4FY11 Q1FY12 Q2FY12

Operating profit margin (LHS) Net profit margin (RHS)


3/16

Industry: Key financial indicators

Note: Net profit: PAT net of prior period & extra-ordinary itemsSource: CMIE

Deposits, credit and growth rates

Note: Call Rates for Dec 11 are up to Dec 10, 2011

Source for all above charts: RBI

Movement in call money rates (%)

Highlights

BANKING INDUSTRY

Note: Data for Dec 11 is up to Dec 2, 2011

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With an aim to provide more flexibility to small borrowers and reduce their cost

of funds, the Ministry of Finance asked state-owned banks to lend money to

small borrowers in the form of working capital, where the borrower pays interest

only on the fund drawn from the bank instead of the entire loan amount.

With an objective to optimise the use of resources, the Government of India

plans to amalgamate geographically contiguous Regional Rural Banks within a

state.

The Reserve Bank of India (RBI) eased the branch authorisation policy and has

allowed the banks to open administrative office or service branch in cities with

population of over 50,000 but less than 100,000, without its approval.With an aim to fetch better returns for depositors, the RBI deregulated interest

rate on savings accounts in Urban Co-operative Banks and Regional Rural Banks.

With an aim to increase the flow of foreign exchange amid the weakening

domestic currency, the RBI hiked interest rates on Non-Resident (external) Rupee

term deposits and Foreign Currency Non-Resident (banks) deposits.

Axis Bank plans to scale up its retail operations by cashing on the demand in

smaller cities to increase the share of retail loans to 30% of total loans from the

current 21% in the next three years.

Indian Overseas Bank plans to restructure its SME and corporate loans by

extending the tenure of repayment.

Bank of India plans to acquire 51% stake in the mutual fund joint venturebetween Bharti Enterprises Ltd and AXA Investment Managers for a deal value of

`53 million.

With an aim to widen their reach, state-run banks led by State Bank of India plan

to install 40,000 white-label automated teller machines (ATMs) not owned byany single bank, across India.

State Bank of India launched mobile banking facility for providing services to

villagers at their door-steps by introducing "Bank on Wheels" vehicle.

In order to enable millions of unbanked Indians to perform basic banking

transactions on their mobile phones, HDFC Bank Ltd in collaboration with

Vodafone India Pvt Ltd launched "m-paisa", a mobile banking service in

Rajasthan.ING Vysya Bank (ING) signed a memorandum of understanding with Oriental

Insurance Corporation (OIC) for offering ePayment services through all its

branches across India.

Deposits (LHS) Credit (LHS)

y-o-y growth rates of deposits (RHS)

y-o-y growth rates of credit (RHS)

Call money rate-High (%)

Call money rate-Low (%)

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

Dec-11

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

10.0

` bn

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

Dec-11

%

8.0

13.0

18.0

23.0

28.0

33.0

38.0

43.0

8,000

13,000

18,000

23,000

28,000

33,000

38,000

43,000


Net sales `bn 1,095.7 1,192.0 1,283.7 1,399.0 1,505.6

y-o-y growth % 16.6 23.7 30.0 35.4 35.7

Net profit `bn 150.9 172.2 143.1 148.6 167.1

y-o-y growth % 18.9 24.5 12.5 -2.8 9.6

Net profit margin 12.0 12.8 9.6 9.5 9.9%


4/16

Highlights

CEMENT INDUSTRY

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Dalmia Cement plans to embark on expansion initiatives by setting up two plants

in Belgaum and Gulbarga (Karnataka). The cement plants which will be

operational in the next two years will have an initial capacity of about 2.5 million

tonnes per annum (mtpa).

NCL Industries Ltd has set up its ready-mix concrete (RMC) plant at Autonagar,

Gajuwaka, and also launched a new product - Nagarjuna RMC. The company

plans to set up similar plant in Hyderabad and in other parts of Andhra Pradesh.

Reliance Cement Company Limited (RCCL) plans to enter the Bengal market with

an investment of ` five billion. The plant is in line with the company's expansion

plans to increase its production to 50 mtpa in the coming years.

Infrastructure and real estate company, Jaypee Group acquired 66.7% stake in

GP Goenka group's Andhra Cements in an all-cash deal of `2.35 billion.

Prism Cements Ltd acquired 50% stake in Small Tiles Pvt Ltd. Post acquisition,

Small Tiles will operate as a joint venture entity of Prism Cements. Small Tiles will

manufacture and supply glazed tiles to H&R Johnson, a division of Prism

Cements, which will market it in the Northern, Eastern and Central regions of

India as also in the overseas markets.

UltraTech Cement plans to expand its production capacity by 10 mtpa to 62

mtpa by Q1FY14. The company plans to invest around ` 110 billion in the

expansion project. The expansion plan includes setting up clinkerisation plants

through brownfield expansions in Chhattisgarh and Karnataka, installing waste-

heat recovery systems, instituting bulk packaging terminal and setting up of

ready-mix concrete plants.

Average wholesale cementprices Mumbai (`/50 kg bag)

Source: CMIE

Cement production and despatches

Source: CMIE


Note: Operating profit: PBDIT net of prior period and extraordinary items (P&E); Net profit: PAT net of P&ESource: CMIE

Nov-09

Jan-10

Mar-10

May-10

Jul-10

Sep-10

Nov-10

Jan-11

Mar-11

May-11

Jul-11

Sep-11

Nov-11

230

240

250

260

270

280

290

300

Parameters

Nov-11 Apr11-Nov11

mntonnes

y-o-ygrowth (%)

mntonnes

y-o-ygrowth (%)

Production 17.6 18.1 140.9 4.6

Despatches 17.7 20.3 140.2 4.8


Net sales `bn 141.6 158.3 200.7 194.5 173.4

y-o-y growth % 3.6 13.2 25.5 12.2 22.5


y-o-y growth % -54.2 -15.9 12.1 6.0 39.2

Net profit `bn 3.6 8.5 20.5 21.5 6.8

y-o-y growth % -84.8 -38.6 12.4 5.1 92.2




5/16

M&HCV: Domestic sales (Nos.)

LCV: Domestic sales (Nos.)

Highlights

COMMERCIAL VEHICLE INDUSTRY

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Domestic sales of commercial vehicles grew sharply by 35% (y-o-y) at 66,264

units in November. Sales of both medium & heavy commercial vehicles

(M&HCVs) and light commercial vehicles (LCVs) registered robust growth of

18.9% and 48.0%, respectively. During the period between April and

November FY12, domestic sales of CVs recorded growth of 20% at 0.49 million

units, as compared to sales in the corresponding period of FY11.

Domestic sales of M&HCVs grew by 9.4% during April-November FY12; sales of

LCVs rose sharply by 29.3% during this eight month period.

Exports of commercial vehicles recorded strong growth of 25.9% at 56,644

units during April-November FY12.

Mahindra Navistar Automotives, the joint venture between Mahindra &

Mahindra and Navistar International Corporation of the US plans to invest ` 2.5

billion at the Chakan unit (Maharashtra) to ramp up the commercial vehicle

manufacturing capacity and expand the distribution network.

Nissan Ashok Leyland Technologies Ltd, the joint venture between Ashok

Leyland and Nissan Motors, plans to make a foray into the passenger transport

vehicle segment in the next couple of years. The JV recently launched LCVs for

cargo transportation. Starting 2012-13, one new variant would be launched

every year for the next 4-5 years. The passenger transport vehicles would have

seating capacities of 8-24 passengers.

Force Motors Ltd and Germany-based MAN Truck & Bus AG, the joint venture

partners of MAN Force Trucks Pvt Ltd (MFTPL) have decided to reorganise their

shareholding in the equity share capital of MFTPL. Force Motors, which currentlyhas 50% stake in the JV, will sell and transfer 55.7 million shares of MFTPL to

MAN, for a consideration of Euro 150 million.

Source: CMIE

Commercial vehicle sales (Nos.)

Source: CMIE



Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-1120,000

25,000

30,000

35,000

40,000

45,000

20,000

25,000

30,000

35,000

40,000

45,000

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

CV: Domestic sales (Nos.)

Source for all above charts: CMIE

40,000

50,000

60,000

70,000

80,000

90,000

Nov-10

Jan-11

Mar-11

May-11

Jul-11

Sep-11

Nov-11

Segments Nov-10 Nov-11y-o-y

growth (%)Apr-Nov

FY11Apr-Nov

FY12y-o-y

growth (%)

M&HCV 21,942 26,086 18.9 195,299 213,645 9.4

LCV 27,145 40,178 48.0 221,501 286,320 29.3

Total domestic sales 49,087 66,264 35.0 416,800 499,965 20.0

Exports 6,083 7,313 20.2 44,974 56,644 25.9Total sales 55,170 73,577 33.4 461,774 556,609 20.5


Net sales `bn 145.4 143.5 192.1 150.6 168.3

y-o-y growth % 46.1 28.0 22.0 13.5 15.7


y-o-y growth % -7.6 1.2 -31.9 -3.5 -33.1

Net profit `bn 6.2 4.6 9.0 5.2 2.1

y-o-y growth % -25.0 -5.8 -46.7 -3.3 -66.8

Operating margin % 10.5 9.5 9.4 9.2 6.1



6/16

Highlights

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Gitanjali Gems Ltd, through its subsidiary Aston Luxury Group Ltd, acquired

100% stake in Crown Aim Ltd of Hong Kong. Crown is a distributor of jewellery

to markets in China, Japan, the USA, the Middle East and Europe. It has a

jewellery manufacturing unit in China, where it also plans to set up a jewellery

retailing unit.

Kerala-based Josco Jewellers opened a gold & diamond jewellery showroom atChavakkad, Kerala, taking its total store count to 21 showrooms across India.

Forever Precious Jewellery and Diamonds Ltd, a manufacturer of gold and

diamond jewellery made a foray into South India by launching a retail jewellery

showroom under the brand name 'Forever Jewellery' in Hyderabad. With the

launch of the new store, the company's store count in India has increased to

143.

Rajwarah Jewellers' company Shimmer plans to expand to the US market by

establishing a headquarter in International Gem Tower in New York's Diamond

District.

Diamondworld.net, a B2B online trading portal entered into an alliance with

Troika Jewels Pvt Ltd's B2C website jeweltouch.com to offer diamonds directlyto the consumers.

With an aim to restructure its international business, Gitanjali Gems transferred

its stake in Giantti Italia S.R.L. to its Milan-based wholly-owned subsidiary

Leading Italian Jewels S.R.L. Further, the company also transferred stake in

Leading Italian Jewels S.R.L. to Aston Luxury Group, a Hong Kong based wholly-

owned subsidiary of the firm.

GEMS AND JEWELLERY INDUSTRY

Gold prices in Mumbai market

Gems & jewellery exports (` bn)

Gems & jewellery imports (` bn)




Price (LHS) Change (RHS)

Jul-10

Aug-10

Sep-10

Oct-10

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

0

50

100

150

200

250

300

350

0

50

100

150

200

250

Jul-10

Aug-10

Sep-10

Oct-10

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

/10 gm

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

%

0

5

10

15

20

25

30

35

40

45

50

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

20000

22000

24000

26000

28000

30000


Net sales `bn 144.6 141.2 184.5 159.6 167.1

y-o-y growth % 31.4 25.0 16.8 23.2 15.3


y-o-y growth % 51.1 43.7 14.4 42.6 21.5

Net profit `bn 4.5 4.3 3.4 4.5 4.9

y-o-y growth % 63.5 53.6 5.1 43.3 9.9




7/16

Civil aviation: Cargo statistics(freight tonne km andmail tonne km)

Source: CMIE

Highlights

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Several lighting companies including Philips India, Havells India and Bajaj

Electricals raised the prices of compact fluorescent lamp (CFL) bulbs by up to

15%. This is due to the rise in prices of rare earth element, a key raw material

component to manufacture CFL, as China has reduced its production and

exports.

With an aim to introduce the entire new for most of its products, Videocon

Industries Ltd plans to invest over ` one billion by 2013 in research and

development and to enhance its manufacturing capacities.

Carrier India plans to acquire building automation and management systems

company Sauter Race Technologies Ltd.

HI-TECH INDUSTRY

Civil aviation: Load factor (%)

Source: CMIE

Civil aviation: Airport traffic statistics (September 2011)

Source: CMIE

Consumer electronics: Key financial indicators


Freight tonne km (LHS) Mail tonne km (LHS)

Freight tonne km y-o-y growth (RHS)

Mail tonne km y-o-y growth (RHS)

-60.0-50.0

-40.0

-30.0

-20.0

-10.0

0.0

10.0

20.0

30.0

40.0

50.0

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

Sep-10

Nov-10

Jan-11

Mar-11

May-11

Jul-11

Aug-11

Sep-11

million %

50.0

55.0

60.0

65.0

70.0

75.0

80.0

85.0

90.0

Sep-10

Nov-10

Jan-11

Mar-11

May-11

Jul-11

Sep-11

Passenger load factor Weight load factor

Parameters

Aircraft traffic Passenger traffic Cargo traffic

Nos.y-o-y

growth (%)Nos.

y-o-ygrowth (%)

Tonnesy-o-y

growth (%)

Domestic traffic 86,162 -13.7 7,480,400 -16.8 74,236 3.0

International traffic 23,772 -6.4 2,900,278 -7.5 124,096 2.8

Total airport traffic 109,934 -12.3 10,380,678 -14.4 198,332 2.9


Net sales `bn 38.9 40.9 42.4 42.8 42

y-o-y growth % 18.3 18.7 18.5 10.5 7.7


y-o-y growth % 19.3 20.8 19.0 8.6 8.3

Net profit `bn 1.7 1.7 1.8 1.8 1.1

y-o-y growth % 9.7 24.4 12.8 8.8 -37.1




8/16

Highlights

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DLF Ltd, as a part of its ongoing non-core divestment strategy, acquired its

partner Hilton's 26% share in the joint venture company DLF Hotels & Hospitality

for ` 1.2 billion from Aro Participation Ltd and Splendid Property Company Ltd,

affiliates of Hilton International Co.

Fairmont Hotels and Resorts Pvt Ltd plans to operate around 40 hotels in India in

the next five years across its three brands including Fairmont, Raffles and

Swissotel.

Owner of Khana Khazana India Pvt Ltd, Sanjeev Kapoor plans to expand

operations of restaurant business through operating around 150 outlets under

different brands in the next three years.ITC Ltd plans to invest around US$ 300 million to set up a luxury hotel in

Colombo. The government approved the foreign direct investment enabling thehotel to build on five acres of land in close proximity to military headquarters in

Colombo on a 99-year lease.

Warburg Pincus-backed restaurant operator AmRest Holdings SE plans to

expand its presence in India through acquisitions.

Clearwater Capital plans to announce an open offer for Kamat Hotels at `135 a

share. Further Clearwater plans to convert Kamat's foreign currency convertible

bonds held by the company.

World hotels Inc plans to develop ten hotels under the 'Worldhotel' brand in

India by 2014. This is part of its newly launched brand license programme acrossthe globe. The company further plans to develop and support 50 hotels underthe World hotel brand by the end of 2014.

Taj GVK Hotels & Resorts along with Greenridge Hotels & Resorts, which is a GVK

company, plans to set up a 275 room five-star deluxe hotel in Mumbai.

HOSPITALITY INDUSTRY

Foreign tourist arrivals in India('000 nos.)

Source for all charts: Ministry of Tourism

Foreign exchange earnings

Growth in foreign tourist arrivals (%)

Source: CMIE


Note: Net profit: PAT net of prior period and extra-ordinary items (P&E)N.A.: Not applicable (Losses incurred)Source: CMIE

-20

-15

-10

-5

05

10

15

20

25

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2009 2010 2011

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

` bn

-50

-30

-10

10

30

50

70

-50

-30

-10

10

30

50

70%

Foreign Exchange Earnings (LHS)

Growth rate (RHS)

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

0

100

200

300

400

500

600

700

800


Net sales `bn 13.3 18.8 20.2 15.2 14.8

y-o-y growth % 13.7 11.8 16.1 13.7 10.9

Net profit `bn -0.3 2.1 3.3 0.7 -0.4

y-o-y growth % N.A -13.3 13.5 125.8 N.A

Net profit margin % -2.8 11.2 14.9 4.3 -2.5


9/16

Highlights

Domestic computer hardware& peripheral production (` bn)

Source: CMIE

IT HARDWARE INDUSTRY

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Reliance Industries Ltd (RIL) plans to offer high speed data services on attractively

priced tablets by the end of 2012 as a part of worldwide deployment of an

advanced technology that RIL plans to use.

Belkin India Ltd launched its wired and wireless keyboards and mouse range. The

company further launched a 24x7 technical support in Hindi.

IBM plans to set up offices in 40 cities across India by 2013. The company further

announced the opening of three regional offices in Dehradun, Guwahati and

Raipur, taking the total number of branch offices to 18 across India.

Canon India plans to triple its business to ` 45 billion (US$ 1 billion) in four years

by opening 300 exclusive outlets, many of which will be in tier-III and IV cities.


Note: Operating profit: PBDIT net of prior period and extra-ordinary items (P&E); Net profit: PAT net of P&EN.A.: Not applicable (Losses incurred)Source: CMIE

nIntel Inc signed a joint venture agreement with Industrial Technology Research

Institute, Taiwan to develop a new generation of memory chips for use in lighter,

energy-saving smart phones and tablets.

Global News

Oct-10

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

2.4 2.4

3.1

1.8 1.9

2.9 2.9

2.6

3.4

2.22.3

3.9

3.0

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5


Net sales `bn 13.4 12.6 13.9 13.0 15.7

y-o-y growth % 4.9 1.6 -3.0 14.2 14.3


y-o-y growth % 8.9 15.1 10.3 7.8 14.3

Net profit `bn -0.6 -1 -1.2 -1.9 -0.4

y-o-y growth % N.A N.A N.A N.A N.A


Net profit margin % -4.1 -7.9 -8.0 -14.1 -2.7


10/16

0

50000

100000

150000

200000

250000

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

PASSENGER VEHICLE INDUSTRY

n

n

n

n

n

n

n

n

n

There was some recovery in sales of passenger vehicles (cars and MUVs) in

November. While domestic sales of passenger cars recorded growth of 4.7%

(y-o-y), sales of multi-utility vehicles rose by 32.4% (y-o-y).

During April-November 2011, domestic sales of passenger cars posted a decline

of 2.2% at 1.3 million units. On the other hand, sales of multi-utility vehicles

registered growth of 11.1% at 0.2 million units during this period.

Exports of passenger vehicles grew by 21.1% at 335,092 units during April-

November 2011.

Carmakers are once again increasing vehicle prices, citing rising input costs and

devaluation of the rupee. Ford India plans to raise car prices by 2-3% effectiveJanuary 2012, while Maruti Suzuki India plans to hike prices by up to 2%.

Hyundai Motor India, General Motors India and Toyota Kirloskar Motor also

announced that they would hike prices by 1.5-2%, 1-2% and 1.5-3%

respectively, from January 2012.

Market leader Maruti Suzuki India is contemplating on postponing its investment

plans in Gujarat by 6-12 months on account of the current slowdown.

Mahindra & Mahindra plans to set up an assembly plant in Southeast Asia, which

is likely to come up in the next two years. The company is targeting markets in

Thailand, Indonesia and Malaysia.

In a bid to increase its market share to 50% by 2015, Maruti Suzuki India intends

to launch new vehicles in the sports utility and multi-utility segments.Hyundai Motor India launched the LPG variant of the i10, priced at ` 0.41-0.43

million (ex-showroom, Delhi).

German luxury carmaker BMW launched its pre-owned car business in India,

under the brand name of BMW Premium Selection. The company expects this

business to be about 10% of its new car sales.

Highlights

Utility vehicles: Domestic sales(Nos.)

Passenger cars: Domestic sales(Nos.)

Source: CMIE

Source: CMIE

Passenger vehicle sales (Nos.)

Source: CMIE

0

5000

10000

15000

20000

25000

30000

35000

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

Segments Nov-10 Nov-11y-o-y

growth (%)Apr-Nov

FY11Apr-Nov

FY12y-o-y

growth (%)

Micro 2,949 7,774 163.6 58,160 54,685 -6.0

Mini & Compact 128,248 129,580 1.0 966,258 893,312 -7.5Super Compact and Mid Size 25,110 30,907 23.1 196,238 233,254 18.9

Executive 3,405 2,483 -27.1 34,022 29,207 -14.2

Premium 1,369 387 -71.7 8,681 8,268 -4.8

Luxury, Coupe Roadster & Exotics 3 0 -100.0 783 783 0.0

Multi-purpose vehicle 18,989 17,414 -8.3 138,415 152,617 10.3

Passenger cars 180,073 188,545 4.7 1,402,557 1,372,126 -2.2

Multi-utility vehicle 21,706 28,736 32.4 202,208 224,558 11.1

Domestic sales 201,779 217,281 7.7 1,604,765 1,596,684 -0.5

Exports 31,099 41,666 34.0 276,600 335,092 21.1

Total sales 232,878 258,947 11.2 1,881,365 1,931,776 2.7


11/16

nPfizer Inc entered into a definitive agreement to acquire ExcaliardPharmaceuticals Inc, a biopharmaceutical company focused on the

development and commercialisation of novel and innovative drugs for the

amelioration of skin scarring and other fibrotic disorders.

Global News

Highlights

PHARMACEUTICAL INDUSTRY

Trend in drugs andpharmaceuticals exports

Source: CMIE

n

n

n

n

n

n

n

Aventis Pharma Limited, part of the Sanofi Group, entered into a definitive

agreement to acquire Mumbai-based Universal Medicare Private Limited's

business of marketing and distribution of branded nutraceutical formulations in

India.

Lupin Limited, through its Japanese subsidiary Kyowa Pharmaceutical Industry

Co Ltd (Kyowa) entered into an agreement with I'rom Holdings Co Ltd, an

integrated Japanese healthcare provider, to acquire up to 100% of the

outstanding shares of its subsidiary I'rom Pharmaceutical Co Ltd.

The Board of Directors of Fortis Healthcare India agreed to acquire 100% of

Fortis Healthcare International from RHC Financial Services Mauritius Limited,for a consideration of US$ 665 million. This acquisition will provide Fortis

Healthcare India an opportunity to establish a dominant position in the rapidly

evolving healthcare delivery marketplace in the Asia Pacific region.

Ozone Pharmaceuticals entered into an original exclusive manufacturer

agreement with Japan-based Koboyashi Pharmaceuticals under which Ozone

will import the Koboyashi's air activated heat packs from Japan and market it in

India to strengthen its presence in the pain management segment.

Hyderabad-based Vivimed Labs acquired Uquifa, manufacturer of active pharma

ingredients (APIs) and intermediates with operations in Spain and Mexico, for a

consideration of US$ 55 million to bring in strategic growth into its product mix

and expand the footprint in Europe and America. Post acquisition, Uquifa will

become the active pharmaceutical ingredient (API) division of the VivimedGroup.

Glenmark Pharmaceuticals Ltd entered into a 10-year marketing pact withCanada's Immanence IDC under which Glenmark will sell a range of high-end

skincare and cosmetic drugs in India and seven other countries. The company

has formed a new unit, Glenmark CosmoCare to market the eight products in

the Indian market.

US-based SOHM Inc, which produces and markets generic pharmaceutical

products for various treatment categories, acquired Pune-based Novatrend

Medicament Pvt Ltd.


Note: Operating profit: PBDIT net of prior period and extraordinary items (P&E); Net profit: PAT net of P&EN.A: Not applicable (Losses incurred)Source: CMIE

Value (LHS) Growth (RHS)

Jul-10

Aug-10

Sep-10

Oct-10

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

%USD mn

0.0

10.0

20.0

30.0

40.0

50.0

60.0

0.0

200.0

400.0

600.0

800.0

1000.0

1200.0

1400.0


Net sales `bn 196.7 196.0 196.0 197.1 219.1

y-o-y growth % 15.4 14.6 7.7 10.1 10.0


y-o-y growth % 23.6 4.4 -19.3 17.2 -26.0

Net profit `bn -3.0 33.4 20.9 28.6 17.1

y-o-y growth % N.A. 15.0 -25.7 15.5 N.A.


Net profit margin % -1.5 16.2 10.1 13.8 7.6


12/16

Highlights

n

n

n

n

n

n

Aditya Birla Retail Ltd plans to invest about ` 15 billion in the next five years to

expand its hypermarket and supermarket stores. The company plans to open 12

stores each year under its hypermarkets format brand 'More Megastore'. It also

plans to add 150 outlets every year to its supermarket format that operates the

'More' brand of chains.

Lifestyle brand Esprit plans to invest US$ 2 million on its pan India expansion in

the next two years. The company plans to open 25 stand-alone boutiques across

leading metro cities and tier I and II cities.

As a part of its ongoing restructuring activity, apparel manufacturer and retailer

Koutons Retail India closed down additional 150 stores. The stores have been

closed to meet the conditions of the corporate debt-restructuring package

approved by the Reserve Bank of India. The stores that have been closed are

mostly of its casual menswear brand Charlie Outlaw. These stores are either

being closed completely or are being converted into Koutons brand stores to cut

losses.

DLF Brands, a subsidiary of realty major DLF Ltd is in the process of setting up

multi-brand retail stores to sell international fashion labels under one roof. The

company plans to open five such outlets every year. Each multi-brand store is

expected to be spread across 10,000 to 15,000 square feet, entailing an

investment of around `150 million each.

Simba Toys India plans to expand its retail presence by launching 50 stores across

the country. The company plans to launch India's largest multi-brand network oftoy stores in the first quarter of 2012 in association with Exelixi Management

Company Private Limited.

VLCC, the wellness and beauty company, plans to launch around 60 exclusive

outlets in India in high footfall areas at malls with an investment of ` 400 million.

The exclusive outlets that will be branded as Beauty Zones, will offer only VLCC

products and some dry services like reflexology (foot massaging).

RETAIL INDUSTRY


Note: Net profit: PAT net of prior period and extra-ordinary itemsN.A: Not applicable (Losses incurred)Source: CMIE


Net sales `bn 20.31 21.74 20.57 18.04 19.82

y-o-y growth % -26.25 -26.24 8.18 -31.62 -2.42

Net profit `bn 0.03 0.35 0.12 0.29 0.19

y-o-y growth % N.A. N.A. N.A. -36.71 653.70

PAT margin % 0.12 1.57 -0.56 1.58 0.96


13/16

Highlights

n

n

n

n

n

n

The Ministry of Steel is increasing thrust on encouraging steel consumption in

rural India to boost domestic consumption. Also, the Ministry plans to set up

steel plants in rural areas with abundant natural resources to produce steel.

Tata Steel Ltd plans to shut down operations at its processing mill at Llanwern

site in Great Britain on account of weak demand for steel owing to poor

economic outlook.

Steel Authority of India (SAIL) Ltd and Japanese firm Kobe Steel Ltd plan to form a

joint venture to manufacture special grade steel in West Bengal with an

investment of US$ 400 million. The joint venture is expected to help SAIL to

acquire the Japanese patented technology.SAIL Ltd and Posco signed a memorandum of understanding (MoU) to conduct a

feasibility study for establishing a steel plant with an annual capacity of three

million tonnes at Bokaro.

National Mineral Development Corporation and Severstal, a Russian steel

company plan to set up a steel plant at Bellary in Karnataka, to be commissioned

by 2017.

Electrosteel Steels Ltd, an associate company of Electrosteel Castings Ltd,

entered into an agreement with Laiwu Steel Group Ltd, a leading steel

manufacturer in China, for assistance in operation and maintenance of its 2.5

million tonnes per annum integrated steel plant in eastern Jharkhand.

Trend in HRC and CRCprices-Mumbai (`/tonne)

Source: CMIE

Finished steel consumption

Source: CMIE

STEEL INDUSTRY



HR Coils (2.00 mm) CR Coils (1.00 mm)

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

38000

40000

42000

44000

46000

48000

50000

52000

Consumption (LHS) Growth (RHS)

%'000 Tonnes

Oct-10

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

-80

-60

-40

-20

0

20

40

0

2000

4000

6000

8000

10000

12000


Net sales `bn 428.1 436.9 503.9 480.1 493.7

y-o-y growth % 17.8 15.2 14.3 25.3 16.2


y-o-y growth % 7.1 -8.8 -6.1 4.4 -18.0

Net profit `bn 43.2 37.6 52.3 37.0 21.0

y-o-y growth % 15.5 -14.0 -13.3 -6.5 -51.1




14/16

Highlights

n

n

n

n

n

n

According to the Cotton Advisory Board, cotton production during 2011-12

(Oct-Sep) is estimated at 35.6 million bales as compared to 32.5 million bales

during the same period of the previous year. However, consumption demand for

cotton remains low due to weak economic prospects in USA and Europe.

The Southern India Mills Association proposed to the Tamil Nadu government tobe exempted from power tariff hikes as the textile industry faces crisis from

domestic and global markets in the form of volatility in cotton and yarn prices

and economic slowdown in USA and Europe.

GTN Industries, an integrated yarns, fabrics and apparels group, plans to invest

`

200 million in mercerised cotton garment facilities in the current fiscal to raiserevenues from `6.8 billion to `7 billion.

The Small and Medium Enterprises Ministry of West Bengal intends to set up a

handloom training institute to create skilled workers for its handloom industry.

Avirate Pvt Ltd, a Sri Lanka-based women's wear and accessories brand

partnered with Fashion 365 Distribution Pvt Ltd to distribute and market its

brand in India.

Arvind Ltd, a textile firm entered into a joint venture agreement with PD Fire

Glass with an intention to make a foray into the glass fabrics segment in India.

Fabrics production(Million sq.metres)

Spun yarn production('000 tonnes)

TEXTILE & GARMENT INDUSTRY




Oct-10

Dec-10

Feb-11

Apr-11

Jun-11

Aug-11

Oct-11

0

1000

2000

3000

4000

5000

6000

Oct-10

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

320

330

340

350

360

370

380

390

400

410


Net sales `bn 272.7 291.0 324.3 285.8 314.9

y-o-y growth % 14.1 28.8 29.1 17.2 15.7


y-o-y growth % 8.8 37.0 27.9 -7.7 -19.5

Net profit `bn 13.8 13.3 14.0 1.9 1.5

y-o-y growth % 18.6 81.9 28.2 -78.0 -89.7




15/16

Three-wheeler: Domestic sales(Nos.)

Two-wheeler: Domestic sales(Million)

Source: CMIE

Source: CMIE

Highlights

n

n

n

n

n

n

n

n

Sales of two-wheelers gathered momentum once again in November, with

domestic sales recording growth of 25.3% at 1.16 million units. Sales of

motorcycles recorded growth of 22.7%, while sales of scooters and mopeds also

grew by 38.5% and 18.9%, respectively.

The April-November 2011 period witnessed a healthy 16.1% increase in

domestic sales of two-wheelers at 8.9 million units. Each of the three segments

recorded growth - motorcycles (14.9%), scooters (23.4%) and mopeds (11.0%).

During April-November 2011, exports of two-wheelers recorded impressive

growth of 31.1% at 1.3 million units.

Yamaha Motor India intends to expand its production capacity from six lakh unitscurrently to 10 lakh units per annum, at an investment of US$ 10 million.

The Kerala State Industrial Development Corporation signed a Memorandum of

Understanding with the US-based Parallel Group to set up a joint venture to

assemble and manufacture electric scooters, bikes and allied products in Kerala.

Suzuki Motorcycle India, a wholly-owned subsidiary of Suzuki Motor Corp

launched its cruiser bike Intruder M800, at a price of ` 8.88 lakh (ex-showroom

Delhi). Honda Motorcycle & Scooter India launched a new variant of its 150 cc

bike CB Unicorn Dazzler, priced at`65,198-66,198 (ex-showroom, Delhi.)

In November, domestic sales of three-wheelers recorded growth of 5.9%, as

against a decline recorded in October. During April-November 2011, domestic

sales of three-wheelers grew by a meagre 0.4% at 0.34 million units. While salesof passenger carriers declined by 3.0%, sales of goods carriers recorded growth

of 15.3%.

Exports of three-wheelers continue to grow sharply. During April-November

2011, exports posted strong growth of 44.2% at 0.25 million units.

TWO-WHEELER AND THREE-WHEELER INDUSTRY

Two-wheeler sales Three-wheeler sales

Source: CMIE


Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

0

10000

20000

30000

40000

50000

60000

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

Segments

Nov-11 April-November 2011

Vol (Nos)y-o-y

growth(%)

Vol (Nos)y-o-y

growth(%)

Motorcycl es 869,070 22.7 6 ,773,534 14.9

Mopeds 64,915 18.9 504,824 11.0

Scooters 229,309 38.5 1,623,691 23.4

Total domestic 1,163,294 25.3 8,902,049 16.1

Exports 163,504 40.8 1,347,296 31.1

Total 1,326,798 27.0 10,249,345 17.9

Segments

Nov-11 April-November 2011

Vol(Nos)

y-o-ygrowth

(%)

Vol(Nos)

y-o-ygrowth (%)

Passenge r car rie rs 34,332 4.5 269,860 -3.0

Goods carriers 8543 11.8 71,022 15.3

Total domesti c 42,875 5.9 340,882 0.4

Exports 29,755 35.3 257,790 44.2

Total 72,630 16.2 598,672 15.5


Net sales `bn 107.7 112.8 115.5 125.5 134.9

y-o-y growth % 29.7 33.6 28.6 27.8 25.2

Operating profit`

bn 18.2 17.4 19.8 20.5 22.5y-o-y growth % 19.1 14.3 19.3 24.6 23.8

Net profit `bn 12.6 12.5 12.1 13.4 14.5

y-o-y growth % 21.9 20.8 4.3 18.5 15.1


Net margin % 11.5 10.9 10.4 10.5 10.6



16/16

D&B's Industry Research Service (IRS) providescomprehensive industry analyses with focus onthe strategic considerations. D&B's IRS employsan integrated framework to analyse industryattractiveness in terms of its future growth potential,competitive intensity and risk assessment.

The reports' in-depth analytical content wouldprovide valuable insights to financial institutions,banks, equity broking houses, and corporatestowards accurate & informed decision making.The reports would also be useful to the industrypractitioners, academicians & scholars.

D&B's IRS also provides independent businessenvironment analysis with focus on macroeconomicand business forecasting, and works closely withthe clients towards meeting their strategic & businessrequirements.

D&B's IRS offers the following sector/ industryreports either as a bundled suite or individualreports:

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industry cursor december 2011

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