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Dairy Market India Dairy Market – May 2013
Executive Summary Market
Consumption of dairy products has grown considerably worldwide Indian dairy market was valued at INR XX tn in 20__ and is estimated to reach INR YY tn by 20__
Challenges
Drivers
Drivers & Challenges
Trends
—Growing Income and Consumption —Rapid Urbanization —Favorable Demographics Rise in Bovine Population in Bovine Population —Rise —Growth of Sub Segments and Other User Industries —Marketing Campaigns —Growing Retail Market
—Inadequate Supply of Feed and Fodder —Shortage of Cold Storage Units —Poor Supply Chain and Distribution Facility —Rise in Packaging Costs
Exhibition and Events Increased Global Attention Product Innovation Growth of Regional Milk Producers Growth of Regional Milk Producers Corporate Activities Major Players
Competition
Company A
Company B
DAIRY MARKET IN INDIA 2013.PPT
Company C
2
•Macro‐Economic Indicators •Introduction •Market Overview •Market Overview •Market Segmentation •Consumer Insights g •Import & Export •Drivers & Challenges •Government Rules & Policies •Government Participation •Trends •Competitive Landscape •Strategic Recommendations g •Appendix DAIRY MARKET IN INDIA 2013.PPT
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Economic Indicators (1/3) Gross Fiscal Deficit: Monthly INR bn 600 500 400 300 200 100 0
f
e c d
b a Sep‐11
Oct‐11
Nov‐11
Dec‐11
Jan‐12
Feb‐12
Exchange Rate: Monthly g y USD/INR 55.0
p
q
54.5 54.0 53.5 Nov 2012
t
r
u
s
Dec 2012
Jan 2013
Feb 2013
DAIRY MARKET IN INDIA 2013.PPT
Mar 2013
Apr 2013 4
Global consumption of dairy products has grown remarkably in the last few years Global Market – Overview • Consumption of protein based food it items are witnessing upward trend in it i dt di the global market • Milk and other dairy products hold an important position in normal diet and its consumption is also growing rapidly its consumption is also growing rapidly • World milk production in 20__ was found to be xx mn tonnes
A
b
Country Ranks – y Production‐wise (2011) ( )
B
Change in Global Protein Consumption g p
Rank
Country
Milk Production (mn tonnes)
100%
1st
EU‐27
xx
80%
2nd
India
xx
3rd
USA
xx
4th
China
xx
40%
5th
Russia
Xx
20%
6th
Brazil
xx
60%
e
t
d
s
c
q
a
p
19__
20__
DAIRY MARKET IN INDIA 2013.PPT
A
D
B
E
C
r
b
0% Note*: EU (European Union)
Consumption share of milk out of total global beverage consumption
a
Dairy consumption grew by x% grew by x% between 19__ and 20__
5
The Indian dairy market is expected to witness remarkable growth… Indian Market – Overview (1/3) • Indian dairy industry is huge and has gained substantial growth momentum in the last few years • Dairy products have gained popularity amongst consumers due to various factors such as increasing income levels, hectic lifestyle and convenience associated with its consumption Being the world’s largest producer and consumer of dairy products, India represents one of the most lucrative dairy markets
• In comparison to other products such as wheat and rice, milk penetration amongst consumers is ~99% • In 20__, Indian dairy market was valued around INR XX tn
Market Si e & Gro th Market Size & Growth INR tn 6 5
+11.7%
4
3.6
3
A
B
20__
20__
C
F D
E
2 1 0 20__
20__
DAIRY MARKET IN INDIA 2013.PPT
20__e
20__e
20__ 6
Domestic milk consumption is very high in both urban as well as rural market Market Segmentation – Rural and Urban Share of Consumer Expenditure on Dairy Products (2012) Urban Consumers
Rural Consumers D
A X
Y
B
• Expenditure on dairy products account for a significant share in the consumer’s wallet • Increased affordability is one of the reasons behind this growing trend
C
Consumption Share of Milk (2012) Urban Consumers • In In India, almost entire India almost entire amount of milk produced gets consumed domestically • Demand for processed and packaged dairy produce is packaged dairy produce is high in the urban market
Rural Consumers
P
S A
Q
DAIRY MARKET IN INDIA 2013.PPT
B R
7
Consumer Insights on Dairy Products (1/10) Sample Size
55
Survey Duration & Period
3 Weeks – May 2013
Sample Sources
Social Media Websites and Other Related Forums
Quantitative Representation Used
Percentage
• Survey on milk and dairy products was conducted on social media sites and other related forums • Overall survey has been kept close‐ended to O ll h b k t l d dt capture specific information according to requirements • The survey has been conducted amongst a group of general consumers heading from group of general consumers heading from major Indian cities including Mumbai, Delhi, Kolkata, Pune, Hyderabad, Bangalore among others
Profile of Respondents – Age Wise (years) 18‐24
31‐35
25‐30 25 30
36‐40 36 40
41 & above
d c e
b
a
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Consumer Insights on Dairy Products (2/10) Q: Do you consume dairy and processed dairy products?
Q: How often do you consume them? Options 1) Daily 2) Alternate days 3) Weekly
Options 1) Yes 2) No
Consumption Share of Dairy Products
Frequency of Consumption
b d
e
c a
Yes
No
Daily
DAIRY MARKET IN INDIA 2013.PPT
Alternate days
Weekly
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Consumer Insights on Dairy Products (4/10) Q: What type of dairy products do you prefer consuming? Options 1) Liquid milk 2) Processed dairy products 3) Both
Q: If you consume both, which one do you prefer more? Options 1) Liquid milk 2) Processed dairy products
Consumption Pattern
Preference‐wise Share of ‘Both’ Category
%
Liquid milk
c
45
Processed dairy products
40 35 30 25 20
x
15
b
10 5
y
a
0
Liquid milk
Processed dairy products
Both
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Import of Major Types of Dairy and Processed Dairy Products (1/5)
SAMPLE
Whole Milk
Major Importing Nations – Value Wise (2011)
Volume
Value
INR mn
‘000 unit C
300
2,000
B
200 A 100
R Q
D
P 0 20__
20__
1,500
d
1,000
c
8,000
150
Q u
p
6,000
G
H
F U
20__ __
F
P
Value
E
0
C
b
‘000 unit
T
E
20__
INR mn
50
B
Major Importing Nations – Value Wise (2011) Volume
100
D
a
0
Skimmed Milk
200
e
500
S 20__
f
A
20__ __
V
W
0
20__ __
S T
4,000 2,000
R
U
t s
r
q
20__ __
Note: HS Code 04022910 (Whole Milk), HS Code 04021010 (Skimmed Milk) DAIRY MARKET IN INDIA 2013.PPT
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Drivers & Challenges – Summary Drivers Growing Income and Consumption Growing Income and Consumption Rapid Urbanization
Challenges Inadequate Supply of Feed and Fodder Shortage of Cold Storage Units
Favorable Demographics
Deficit in Power Supply
Rise in Bovine Population
Poor Supply Chain and Distribution Facility
Growth of Sub Segments and Other G th f S b S t d Oth User Industries
Rise in Packaging Costs
Marketing Campaigns Growing Retail Market
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Trends – Summary
Exhibition and X
Increased Y Attention
` Key Trends
Product Z
Growth of A
Corporate Activities p
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Competitive Benchmarking (1/5) Public Trading Comparables (FY 2012) Company A
Company B
Company C
Company D
Company E
Market Capitalization (INR mn)
XX
XX
XX
XX
XX
Share Price (INR)
XX
XX
XX
XX
XX
EV/EBITDA (x)
XX
XX
XX
XX
XX
EV/Revenue (x) /
XX
XX
XX
XX
XX
PE Ratio
XX
XX
XX
XX
XX
Note: Top 5 Public companies based on the Market Capitalization; Market Capitalization, Share Price and PE ratio is as of 17/05/2013 DAIRY MARKET IN INDIA 2013.PPT
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SAMPLE SSAMPLE
Competitive Benchmarking (2/5)
Key Ratios of Top 3 Companies – Operational Basis (FY 2011) (1/3) Operating Margin
%
Net Margin
40 30.39
30
21.73
20
11.04
10
7.30 2 49 2.49
1.41
0
Company A
Company B
CompanyC
• xx
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SAMPLE
Public: Domestic Company – Player A (1/5) Company Information Corporate Address
xx
Tel No.
xx
Fax No.
xx
Website
xx
Year of Incorporation
xx
Ticker Symbol
xx
Stock Exchange
xx
Offices and Centres – India
City A
Head Office
Products and Services Products and Services Category
Products/Services
Key People RTE Products RTE Products
xx
Other Food Products
xx
N Name
DAIRY MARKET IN INDIA 2013.PPT
D i ti Designation
16
SAMPLE
Public: Domestic Company – Player A (2/5) Financial Snapshot i i lS h
K Key Ratios i
Total Income INR mn a
A
150
c
b
100
1000 500
INR mn
d
2000 1500
Particulars
Net Profit/Loss
B
D
C
50
0
0
2009
2010
2012
2011
Financial Summary • The company reported total income of INR 1585.4 mn in FY 2012, registering an increase of 19.7% over FY 2011 registering an increase of 19.7% over FY 2011 • The company earned an operating margin of 7.37% in FY 2012, a decrease of 3.31 percentage points over FY 2011 • The company reported debt to equity ratio of 0.32 in FY 2012, a decrease of 7.22% over FY 2011
Value (dd/mm/yyyy) XX
Total Enterprise Value (INR mn)
XX
EPS (INR) EPS (INR)
XX XX
PE Ratio (Abs)
2010
2009
14.80%
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 Operating costs (% of Sales) Administration costs (% of Sales) Interest costs (% of Sales) Interest costs (% of Sales)
‐3.31
7.37%
10.69%
11.63%
‐6.73
4.02%
10.75%
12.08%
7.61%
‐5.22
6.52%
11.74%
15.66%
11.00%
‐7.25
5.51%
12.76%
13.22%
9.02%
‐2.22
8.50%
10.73%
12.11%
16.70%
‐7.92
20.82%
28.74%
28.25%
56.05%
‐1.89
6.67%
8.56%
10.77%
14.08%
‐4.90
26.02%
30.92%
33.44%
41.15%
3.47
92.50%
89.03%
87.70%
84.70%
5.78
33.11%
27.33%
22.91%
25.64%
‐0.24
0.82% %
1.06% %
1.21% %
1.74% %
Liquidity Ratios Current Ratio Cash Ratio
0.43%
2.49
2.48
4.42
2.60
‐14.77%
0.53
0.63
1.76
1.09
7.22%
0.32
0.30
0.01
0.02
5.46%
0.24
0.23
0.01
0.02
‐12.08%
9.10
10.35
10.14
8.78
23.09%
3.47
2.82
2.72
2.69
14.00%
0.89
0.78
0.88
0.92
6.29%
1.66
1.56
1.78
2.26
5.98%
2.78
2.62
2.30
3.66
14.65%
1.02
0.89
1.02
1.13
Leverage Ratios Debt to Equity Ratio Debt to Capital Ratio b i l i Interest Coverage Ratio
Key Financial Performance Indicators Indicators
2011
Cost Ratios
• The company incurred a net profit of INR 63.7 mn in FY 2012, as compared to net profit of INR 142.4 mn in FY 2011
Market Capitalization (INR mn)
y‐o‐y change 2012 (2012‐11)
Efficiency Ratios Fixed Asset Turnover Asset Turnover Current Asset Turnover Working Capital Turnover Capital Employed Turnover
Improved
DAIRY MARKET IN INDIA 2013.PPT
Decline
17
SAMPLE
Public: Domestic Company – Player A (3/5) Key Business Segments Traded Goods
Key Geographic Segments
Processed and Preserved Foods
100%
A
C
50%
B
D
E
F
India
Exports
100%
Q
S
50%
P
R
T
U
2009
2010
2011
2012
0%
0%
2009
2010
2011
2012
Business Highlights Description
News
Overview
• XX
DAIRY MARKET IN INDIA 2013.PPT
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SAMPLE
Public: Domestic Company – Player A (4/5) Business Highlights Description
News
Global Presence
• XX
Quality Assurance Q y
• XX
E Expansions i
• XX
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Public: Domestic Company – Player A – SWOT Analysis (5/5)
SAMPLE
• xx
• xx
S
W
O
T
• xx
• xx
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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)}
q y Debt to Equity
Total Liabilities / Shareholders E it 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 (N I / Sh h ld Equity)*100 EBIT / (Total Assets – 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 Expenses / Sales) *100
Capital Employed Turnover
Sales / (Shareholders Equity + Sales / (Shareholders Equity + Total Debt)
Interest Costs (% of Sales)
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Sources of Information Secondary Research Print Medium
Primary Research Interviews
Leading Newspapers Leading Newspapers
Leading Industry Vendors Leading Industry Vendors
Journals / Magazines
Industry Stakeholders
Business Magazines
Industry Experts
Electronic Medium Company Websites
Surveys Conducted in Social / Technology Focused Forums
Government Websites / Resources Online Magazines / Online Journals / Articles Premium Databases Social Networking Space
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