Market Research Report : Broadband internet in india 2014 - Sample by Netscribes, Inc.

Broadband Internet â&#x20AC;&#x201C; India August 2014

Executive Summary

Market Overview

Drivers & Challenges

 Broadband internet market size in India in terms of volume or subscriber base was x1 mn in month1 20-- and x2 mn in month2 20- Globally broadband internet market size in terms of volume was around x3 bn in 20--, with a x4% Y-o-Y growth from nearly x5 bn total subscribers in 20- Average internet speed in India was around x6 Mbps as of month3 20-- which was significantly lower than other countries such as country1, country2, and country3 amongst others Drivers:

Challenges:

 Burgeoning PC Penetration and Wireless Subscriber Base  Increase in Disposable Income  Soaring Demand in Enterprises  Increasing Demand for Rich Web Contents and Social Networking  Affordability of Broadband Services  Changing Demographics and Consumer Behaviour

 Weak Broadband Coverage and Infrastructure in Rural Areas  Service Inconsistency  Lack of Regional Language Support  Affordability of Next Generation Mobile Networks

Key Players

Competitive Landscape

Bharti Airtel Ltd.

Idea Cellular Ltd.

Reliance Communications Ltd.

Bharat Sanchar Nigam Ltd.

Tata Teleservices Ltd.

Vodafone India Ltd.

BROADBAND INTERNET IN INDIA 2014.PPT

•Macro Economic Indicators •Introduction •Market Overview •Government Initiatives •Drivers and Challenges

•Competitive Landscape •Recent Developments •Market Opportunities •Consumer Insights •Strategic Recommendations

•Appendix BROADBAND INTERNET IN INDIA 2014.PPT

Economic Indicators (-/-) GDP at Factor Cost: Quarterly INR tn 15

d1 c1 b1

c4 b4 a4

c3 b3 a3

d2 c2 b2 a2

11 Q1

2010-11

2011-12

2012-13

2013-14

Inflation Rate: Monthly % 2.0

1.5

1.0

t r

0.5 0.0 Jun 2013 - Jul 2013

Jul 2013 - Aug 2013

Aug 2013 - Sep 2013

Sep 2013 - Oct 2013

BROADBAND INTERNET IN INDIA 2014.PPT

Oct 2013 - Nov 2013 4

Introduction Broadband Internet â&#x20AC;&#x201C; Overview Broadband is the general expression for high bandwidth internet connection capable of more than 256 Kbps of speed Broadband was first launched in UK in 2000 providing a complete different experience to Internet, coming from dial-up internet connections that typically operated on 56 Kbps modems Broadband internet speed in other countries such as UK, US, China, Korea and others, are a lot higher than the defined lower limit, going all the way up to 14 Mbps on the average Broadband internet has opened new avenues for entertainment, education, productivity and communication

Major Internet Access Technologies Technology

Description

Internet via Phone Line

Internet access via 56 Kbps modems connected to fixed phone using public switched telephone network (PSTN)

Internet via LAN (Local Area Network)

Internet served via Ethernet cable using LAN by individual ISPs in the area

Internet Over Cable TV Line

Cable TV service providers providing Internet via the same line

Wireless

Internet served via wireless frequency channels by various ISPs

Mobile Internet

Mobile data access via cellular networks using 2G, 3G and 4G technology BROADBAND INTERNET IN INDIA 2014.PPT

Country1 and Country2 are in the leading position in both fixed and wireless broadband adoption globally Market Overview (-/-) • Market for broadband Internet comprised around x1 mn subscribers in 20-- and it is expected to grow at a CAGR of x2% till 20- Segment3 broadband Internet market will evolve to reach the mark of INR x3 tn by 20-- - 20--

• Also segment1 market size is expected to be worth INR x4 bn by 20--, with contribution of segment2 of ~INR x5 bn • Broadband Internet and segment3 are becoming popular as they offer feature1 at a predictable and considerable aspect1 • Broadband Internet in India is yet to gain wide-scale acceptance, but its future prospects are high and significant adoption is predicted over the next 5 years with the introduction of technology1 and technology2 in India • Government of India has mandated for all the broadband Internet service providers to follow mandate1 for purpose1 in India

Broadband Subscribers Base – Global mn a6

+y% a1

20--

BROADBAND INTERNET IN INDIA 2014.PPT

20--

20-6

Government Initiatives – Broadband Internet Past Initiatives • Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text • Text text text text text text text text text text text text text text text text text text text text text text text text textText text text text text text text text text text text text text text text text text text text text text text text text text

National Broadband Plan • Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text • Text text text text text text text text text text text text text text text text text text text text text text text text textText text text text text text text text text text text text text text text text text text text text text text text Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text • Text text text text text text text text text text text text text text text text text text text text text text text text textText text text text text text text text text text text text text text text text text text text text text text text

BROADBAND INTERNET IN INDIA 2014.PPT

Drivers & Challenges â&#x20AC;&#x201C; Summary

Drivers

Challenges

Burgeoning PC Penetration and Wireless Subscriber Base

Weak Broadband Coverage and Infrastructure in Rural Areas

Increase in Disposable Income

Service Inconsistency

Soaring Demand in Enterprises

Lack of Regional Language Support

Increasing Demand for Rich Web Contents and Social Networking

Affordability of Next Generation Mobile Networks

Affordability of Broadband Services Changing Demographics and Consumer Behaviour

BROADBAND INTERNET IN INDIA 2014.PPT

Porter’s Five Forces Analysis

SAMPLE

Threat of New Entrants • Text text text text text text text text text text text text text text text text text text text text text text text text text Impact Medium Bargaining Power of Suppliers • Text text text text text text text text text text text text text text text text text text text text text text text text text

Impact Medium

Competitive Rivalry • Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text

Threat of Substitutes • Text text text text text text text text text text text text text text text text text text text text text text text text text

BROADBAND INTERNET IN INDIA 2014.PPT

Impact High Bargaining Power of Buyers • Text text text text text text text text text text text text text text text text text text text text text text text text text

Impact Low

Competitive Benchmarking (-/-) Key Ratios of Top 4 Companies – Operational Basis (FY 2013) (1/3)

Operating Margin

% b1

SAMPLE Net Margin d1

c1 c2

a1 a2

0 company1

company2

company3

company4

• Company1 recorded operating margin of -%, higher than that of company2, company3 and company4 which recorded operating margin of -%, - and -% respectively • Thermax however recorded the highest net margin of -% higher than that of Ion Exchange, SPML and Va Tech Wabag which recorded net margins of -%, -% and -% respectively

BROADBAND INTERNET IN INDIA 2014.PPT

Public: Domestic Company – Company 1 (1/4) Company Information

SAMPLE Offices and Centres – India

Corporate Address Tel No. Fax No. Website Year of Incorporation Ticker Symbol Stock Exchange

Head Office

Products and Services Category Sectors (EPC)

Products/Services

Key People Name

BROADBAND INTERNET IN INDIA 2014.PPT

Designation

Public: Domestic Company – Company 1 (2/4)

SAMPLE

Financial Snapshot

Key Ratios

Total Income

Net Profit/Loss

Particulars

INR bn

INR bn s1

s2 t2

s4 s3 t3 t4

0 2010

2011

2012

2013

Financial Summary

y-o-y change (2013-12)

2013

2012

2011

2010

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 • The company incurred a net loss of INR - bn in FY 2013, as compared to net profit of INR - bn in FY 2012 • The company reported total income of INR - bn in FY 2013, registering a decrease of -% over FY 2012 • The company earned an operating margin of -% in FY 2013, a decrease of percentage points over FY 2012 • The company reported debt to equity ratio of - in FY 2013, an increase of % over FY 2012

Market Capitalization (INR mn) Total Enterprise Value (INR mn) EPS (INR) PE Ratio (Absolute)

Liquidity Ratios Current Ratio Cash Ratio

Leverage Ratios Debt to Equity Ratio Debt to Capital Ratio Interest Coverage Ratio

Key Financial Performance Indicators Indicators

Operating costs (% of Sales) Administration costs (% of Sales) Interest costs (% of Sales)

Value (17/01/2014)

Efficiency Ratios Fixed Asset Turnover Asset Turnover Current Asset Turnover Working Capital Turnover Capital Employed Turnover Improved

BROADBAND INTERNET IN INDIA 2014.PPT

Decline

Public: Domestic Company – Company 1 (3/4)

SAMPLE

Key Business Segments

Key Geographic Segments

Construction and Engineering

India

2010

2011

2012

2013

g1 0%

0% 2013

Overseas

Business Highlights

Description

News • Text text text text text text text text text text text text text text text text text text text text text text text

Overview

text text text text text text text text text text text text text text

• Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text

Extensive Product Portfolio

• Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text

BROADBAND INTERNET IN INDIA 2014.PPT

SAMPLE

Public: Domestic Company – Company 1 (4/4)

BROADBAND INTERNET IN INDIA 2014.PPT

SAMPLE

Private: Domestic Company – Company 2 (1/5) Company Information

Offices and Centres – India

Corporate Address

Tel No. Fax No. Website Ahmedabad

Year of Incorporation

Head Office Products and Services Category Products

Products/Services Key People Name

BROADBAND INTERNET IN INDIA 2014.PPT

Designation

SAMPLE

Private: Domestic Company â&#x20AC;&#x201C; Company 2 (2/5) Shareholders of the Company as on 28.09.2012

Name

Ownership Structure

No. of Shares held

Corporate Bodies

Foreign holdings

X X

30% Total

70%

BROADBAND INTERNET IN INDIA 2014.PPT

SAMPLE

Private: Domestic Company – Company 2 (3/5) Financial Snapshot

Key Ratios

Total Income

Particulars

Net Profit/Loss

INR mn

INR mn u4 u2 u1

u3 v3

2010

2011

2012

2013

Financial Summary

2011

2010

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

• The company reported total income of INR - mn in FY 2013, registering an increase of -% over FY 2012

Leverage Ratios

• The company reported debt to equity ratio of - in FY 2013, a decrease of -% over FY 2012

2012

Profitability Ratios

• The company earned a net profit of INR - mn in FY 2013, as compared to net loss of INR - mn in FY 2012

• The company earned an operating margin of -% in FY 2013, an increase of - percentage points over FY 2012

y-o-y change 2013 (2013-12)

Current Ratio Cash Ratio 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

BROADBAND INTERNET IN INDIA 2014.PPT

Decline

SAMPLE

Private: Domestic Company – Company 2 (4/5) Business Highlights

Description

News • Text text text text text text text text text text text text text text text text text text text text text text text

Overview

text text text text text text text text text text text text text text

• Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text

Extensive Product Portfolio

• Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text

BROADBAND INTERNET IN INDIA 2014.PPT

Private: Domestic Company – Company 2 – SWOT Analysis (5/5)

SAMPLE

BROADBAND INTERNET IN INDIA 2014.PPT

Recent Developments – Broadband Internet in India (-/-)

Development1

• text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text • text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text

Development2

• text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text • Text text text text text text text text text text text text text text text text text text text text text text text text text text text text

• text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text

Development3

• text text text text text text text text text text text text text text text text

BROADBAND INTERNET IN INDIA 2014.PPT

Growing number of internet-enabled mobile and consumer devices are creating significant opportunity for broadband Market Opportunities (-/-) • text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text • text text text text text text text text text text text text text text text text text text text text text text text text text

Broadband Internet Opportunity – Addressable User Base INR mn +X1%

20--e

Consumer Insights – Mobile Internet Usage Survey (-/-) Survey on Broadband Usage & Preference – Introduction & Methodology • Survey on broadband usage & preference was conducted on multiple social media sites • Overall survey has been kept close ended to capture common areas of user interest • The survey has been conducted amongst a small group of people belonging to home users, gamers, technology & other professionals

Sample Size

Sample Sources

Social Media Websites and Technology Forums

Survey Duration

May 2014 to Jun 2014

Quantitative Representation Used

Percentage

Present Broadband Speed R1

Q: What broadband speed do you use?

Response Options: 1) R1 2) R2 3) R3 4) R4

60 40 20 0

BROADBAND INTERNET IN INDIA 2014.PPT

Strategic Recommendations (-/-) â&#x20AC;˘Companies need to focus on specific1 and specific2 early to leverage on specific3

Recommendation1

Recommendation2

BROADBAND INTERNET IN INDIA 2014.PPT

Appendix Ratio

Calculations

Ratio

Calculations

Operating Margin

(Operating Income/Revenues)*100

Current Ratio

Current Assets / Current Liabilities

Net Margin

(Net Profit / Revenues) *100

Cash Ratio

Profit Before Tax Margin

(Income Before Tax / Revenues *100

{(Cash & Bank Balance + Marketable Securities) / Current Liabilities)}

Debt to Equity

Total Liabilities / Shareholders Equity

Debt to Capital Ratio

{Total Debt / (Shareholders Equity + Total Debt)}

Interest Coverage Ratio

EBIT / Interest Expense

Fixed Asset Turnover

Sales / Fixed Assets

Asset Turnover

Sales / Total Assets

Return on Equity (ROE) Return on Capital (ROCE) Return on Working Capital

(Net Income / Shareholders Equity)*100 EBIT / (Total Assets â&#x20AC;&#x201C; Current Liabilities)*100 (EBIT / Working Capital) *100

Return on Assets

(EBIT / Total Assets)*100

Return on Fixed Assets

(EBIT / Fixed Assets) *100

Operating Costs (% of Sales)

(Operating Expenses / Sales) *100

Current Asset Turnover

Sales / Current Assets

Administration Costs (% of Sales)

(Administrative Expenses / Sales) *100

Working Capital Turnover

Sales / Working Capital

Interest Costs (% of Sales)

(Interest Expenses / Sales) *100

Capital Employed Turnover

Sales / (Shareholders Equity + Total Debt)

BROADBAND INTERNET IN INDIA 2014.PPT

Sources of Information

PRIMARY RESEARCH Interviews Leading Industry Experts

SECONDARY RESEARCH Print Media

Electronic Media

Leading Newspapers

Regulatory Websites

Magazines and Journals

Telecommunication & Technology Magazines

Annual Reports of Companies

Company Websites Premium Databases Open Sources

BROADBAND INTERNET IN INDIA 2014.PPT

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BROADBAND INTERNET IN INDIA 2014.PPT