Cardiac Pacemaker Market – India August 2014
Executive Summary Market
Cardiac pacemaker market in India is exhibiting a volume-wise CAGR of x1% over 2012-18e and value-wise CAGR of x2% over the same period The industry is dominated by foreign companies Hospitals sell pacemakers as well as offer complete packages to patients Drivers: Changing demographics
Drivers & Challenges
High rate of cardiovascular diseases Low market penetration Growing awareness Changing Insurance coverage structure and business model
Trends
Challenges: Lack of standard regulatory structure and government initiatives Unwillingness to spend on medical devices Weak manufacturing base
Product innovation Focus on low cost goods Significant presence of MNCs Major Players
Competitive Landscape
Company 1
Company 2
Company 3
Company 4
Company 5
Company 6
CARDIAC PACEMAKER MARKET IN INDIA 2014.PPT
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•Macroeconomic Indicators •Introduction •Market Overview •EXIM •Drivers & Challenges •Trends •Competitive Landscape •Strategic Recommendations •Appendix CARDIAC PACEMAKER MARKET IN INDIA 2014.PPT
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Economic Indicators (1/3) GDP at Factor Cost: Quarterly INR tn 15
13
d1 c1 b1
12
a1
14
c4 b4 a4
c3 b3 a3
d2 c2 b2 a2
11
Q1
Q2 2010-11
2011-12
2012-13
Q3 2013-14
Q4
Inflation Rate: Monthly % 2 1
p
r
s
q
0 -1
t
-2
Jul 2013 - Aug 2013
Aug 2013 - Sep 2013
Sep 2013 - Oct 2013
Oct 2013 - Nov 2013
CARDIAC PACEMAKER MARKET IN INDIA 2014.PPT
Nov 2013 - Dec 2013 4
Cardiac pacemaker market is poised to grow at a steady rate in the future Market Overview (1/3)
Market Size & Growth (Volume-Wise)
• Cardiac pacemaker market in India offers strong potential for both existing and new players
‘000
• India along with Country A are the growing markets for cardiac rhythm management products of which pacemakers form the largest part • Majority of players are foreign companies with distributors or subsidiaries in India These companies have been able to strengthen their foothold in the market due to their brand recognition, reliability and technological superiority
• Domestic players make significant investments and rely on profits generated in India as well as abroad While some players purely operate in India, others have a global presence Smaller players utilize product differentiation strategies rather than reduced pricing methods to maintain their foothold in the market
• Improvements in technology such as the invention of leadless pacemakers will further aid growth in the market
+x1%
50 40 a1
b1
2012
2013
30 20 10 0
c1
d1
2014e
2015e
f1
2016e
g1
2017e
h1
2018
Market Size & Growth (Value-Wise) INR bn +x2%
6 4
a2
b2
c2
2012
2013
2014e
d2
f2
2015e
2016e
g2
h2
2 0
2017e
2018
Healthy growth rates provide an impetus to existing and potential players to invest in the market
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Although low cost products are exported to other countries… Exports – Overview
Export of Cardiac Pacemakers
• Export of pacemakers from India has been increasing over the past few years • Number of countries to which pacemakers were exported has also decreased over the years • Products are mostly exported to the countries in Region A • Strong domestic market and weak manufacturing base is responsible for fluctuating exports
INR mn
Export (Region-Wise: 2012-13)
Volume
100 c2
50
a2 a1
d2
3 f2
b2
2 c1
b1
d1
f1
0
1 0
2009-10
2010-11
2011-12
2012-13
2013-14 (Apr - Dec)
Export (Region-Wise: 2013-14; Apr - Dec) Country 1
r1% q1% s1% t1% u1%
‘000 units
Value
Country 1
Country 2
q2%
Country 3 Country 4
Country 5
Country 5 Country 2 Country 7
p2%
Others p1%
u2% t2% r2% s2%
Country 4 Others
Note: Figures are for respective financial years CARDIAC PACEMAKER MARKET IN INDIA 2014.PPT
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Drivers & Challenges – Summary
Drivers Changing demographics
Challenges
High rate of cardiovascular diseases
Unwillingness to spend on medical devices
Low market penetration
Weak manufacturing base
Growing awareness
Changing Insurance coverage structure and business model
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Trends – Summary
Improvements in Technology
Trends
Monitoring via Internet
Reuse
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Porter’s Five Forces Analysis Impact Threat of New Entrants
Impact
Impact Impact
Bargaining Power of Suppliers
Competitive Rivalry
Bargaining Power of Buyers
Impact
Threat of Substitutes
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Competitive Benchmarking (1/3) Key Ratios of Top 3 Companies – Operational Basis (FY 2013) (1/3) Operating Margin
%
8
Net Margin
a1 a2
6 4
c1
b1
c2
b2
2 0 Company 1
Company 2
Company 3
• Company 3 recorded operating margin of c1%, lower than that of Company 1 which recorded operating margin of a1% but higher than Company 2 which recorded operating margin of b1% • Company 1 recorded the highest net margin of a2%, higher than Company 3 which recorded a net margin of c2% and Company 2 which recorded a net margin of b2%
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Public: Domestic Company – Company 1 (1/4) Company Information
Offices and Centres – India
Corporate Address Tel No. Fax No. Website Year of Incorporation Pithampur
Ticker Symbol Stock Exchange
Products and Services Category
Head Office
Products/Services
Key People Name
Designation
Person 1
Chairman and MD
Person 2
Whole Time Director
Person 3
Whole Time Director
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Public: Domestic Company – Company 1 (2/4) Financial Snapshot Total Income
INR mn 80
Net Profit/Loss
INR mn d2
a2
c2
2
-b2
60 40
Key Ratios
0
a1
20
b1
c1
d1
0
-2 -4
2010
2011
2012
2013
Financial Summary • It reported total Income of INR XX mn in FY 2013, registering an increase of X per cent over FY 2012 • It earned an operating margin of X.X per cent in FY 2013 an increase of X.X percentage points over FY 2012 • The company reported debt to equity ratio of X.XX in FY 2013, an increase of X.X per cent over FY 2012
Key Financial Performance Indicators Market Capitalization (INR mn) Total Enterprise Value (INR mn) EPS (INR) PE Ratio (Absolute)
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
• Company earned a net profit of INR XX mn in FY 2013, as compared to net profit of INR Y mn in FY 2012
Indicators
Particulars
Value (dd/mm/yyyy)
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
CARDIAC PACEMAKER MARKET IN INDIA 2014.PPT
Decline
12
Public: Domestic Company – Company 1 (3/4) Key Business Segments
Key Geographic Segments
Category 1
Region 1
Region 2
100%
100% Total revenue for the company has been coming from only this segment for last 5 years
50% 0%
50%
p1%
q1%
r1%
s1%
0%
p2%
q2%
r2%
s2%
2008
2009
2010
2011
2013
Business Highlights Description
News
Overview
• Operates with its subsidiary, Company A
Business
• It has its plant located at City 1 • Has a licensed and installed capacity of producing ‘y’ number of pacemakers annually • The company is also into the business of contract manufacturing
Pacemakers
• They make both internal as well as external pacemaker • The permanent pacemakers are available in various modes such as : Model 1, Model 2, Model 3 and Model 4
Shareholders
• Promoters occupy ‘a’% of the shares whereas general public hold ‘b’% of the shares
Awards and Recognitions
• Received ISO 9001:2000 certification in 2007 CARDIAC PACEMAKER MARKET IN INDIA 2014.PPT
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Public: Domestic Company – Company 1 – SWOT Analysis (1/4)
S
W
O
T
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Private: Domestic Company – Company 2 (1/5) Company Information
Offices and Centres – India
Corporate Address
Tel No. Fax No. Website Year of Incorporation Bangalore
Products and Services Category
Head Office
Products/Services
Key People Name
Designation
Person 1
Director
Person 2
Director
Person 3
Director
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Private: Domestic Company – Company 2 (2/5) Shareholders of the Company as on 30.09.2013 Name
No. of Shares held
Ownership Structure Category 1 Category 2 Category 3
Entity 1
c% Entity 2 Entity 3
b% Total a%
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Private: Domestic Company – Company 2 (3/5) Financial Snapshot Total Income
Key Ratios Net Profit/Loss
Particulars
INR mn
INR mn
6
4 2
-c2
-a2
-d2
-10
-b2 c1%
a1
0
-20
b1 d1
0
-30 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
• It reported total Income of INR XX mn in FY 2013, registering an increase of X per cent over FY 2012
Leverage Ratios
• The company reported debt to equity ratio of X.XX in FY 2013, an increase of X.X per cent over FY 2012
2012
Profitability Ratios
• Company earned a net profit of INR XX mn in FY 2013, as compared to net profit of INR Y mn in FY 2012
• It earned an operating margin of X.X per cent in FY 2013 an increase of X.X 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
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Private: Domestic Company – Company 2 (4/5) Business Highlights Description
News
Overview
• The company’s manufacturing facility in City 1 is equipped with the latest tools and equipments
Expansion Plans
• They are also into contract manufacturing-for various pacemakers for OEMs
Investors
• Company B is a strategic investor in the company
Pacemaker
• Entered into an exclusive technology transfer agreement with Company C in 2009 • Partnered with Company D for pacemaker leads in 2009
Awards and Recognitions
• An ISO 9001-2008 and ISO 13485-2003 certified advance medical device company
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Private: Domestic Company – Company 2 – SWOT Analysis (5/5)
S
W
O
T
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