E-books Market in India February 2015
Executive Summary Market Overview
E-book has been a known phenomenon in the global platform for quite some years and is posting a healthy growth E-books market in India is still in its nascent stage but is slated to see good growth in the coming 1-2 years E-books can be categorized into academic, trade and graphic novels
Challenges:
Drivers: Drivers & Challenges
Trends
Growth in education Increase in internet users Demographical alterations Increase of internet enabled computing devices Improvised content Publishers save costs in this format
Application approval from Apple Retail chain offering e-book reading application Drive to convert books into digital formats Foreign giant setting stores in India
Negative consumer perspective related to cyber security & piracy High prices of e-book readers Majority focus on academic text books Lack of touch and feel element Technological add-ons Digital rights management Sports category emerges as a thriving option
Major Players
Competitive Landscape
Company A
Company B
Company C
Company D
Company E
Company F
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•Macro Economic Indicators •Introduction •Market Overview •Benefits •Formats & Software •Drivers & Challenges •Government Regulations •Trends •Competitive Landscape •Strategic Recommendation •Appendix E-BOOKS MARKET IN INDIA 2015.PPT
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Economic Indicators (-/-) GDP at Factor Cost: Quarterly INR tn c4 b4 a4
15 14 d1 c1 13 b1
c3 b3 a3
d2 c2 b2 a2
12 a1 11 Q1
Q2 2010-11
2011-12
Q3 2013-14
2012-13
Q4
Inflation Rate: Monthly
% 2.0
p
1.5
s q
1.0
t r
0.5 0.0
Jun 2013 - Jul 2013
Jul 2013 - Aug 2013
Aug 2013 - Sep 2013
Sep 2013 - Oct 2013
E-BOOKS MARKET IN INDIA 2015.PPT
Oct 2013 - Nov 2013 4
Evolution of e-books
SAMPLE X
X
1995
1991
•X
20012006
•X
2003
2007
2012
2008
•X •X
•X •X
•X
X
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Though nascent, the market is slated to usher in a positive change in the coming 1-2 years E-books – Indian Market Overview
SAMPLE
• Indian e-Book market is currently witnessing a positive growth and is expected to gain further momentum in the next 2-3 years Basically, the huge presence of tech savvy youth and working class population is driving the demand for e-books in India Additionally, educational institutions in an attempt to bring about innovation are incorporating the use of e-books in the curriculum
By the end of 2013, India had an estimated population of close to x mn e-book readers in India as compared to y mn as on Feb 2012 Although, the market accounts for merely x% of the total publishing market in the nation, nevertheless the sheer amount of the population is driving the market
E-books – Market Size & Growth
E-books – Market Segmentation (2013)
INR bn
X
X
C
Y
x6 X
B
x5 A x1
x2
x3
2013
2014*
2015e
x4
0 2016e
2017e
2018e
* Data corresponds to the month of Oct, 2014
Y Note: Others include ‘Trade’ and ‘Graphic Novels’
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Print Book v/s E-book
SAMPLE
The comparative study throws light on the pros and cons of using e-books over print books Print Books
E-books
X
X
Advantages
Advantages
•X
•X XX
Disadvantages
Disadvantages
•X
•X
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SAMPLE
Print Book v/s E-book Retail Price per book
Print Book
E-book
INR X
INR X
Royalty payment to author
Paid to retailer
INR X
INR X
INR X
INR X
Others
INR X
The publisher receives ~ INR X per unit sold
INR X
The publisher receives ~ INR X per unit sold
• Under the agency pricing model, retailers act as agents and take a% while leave the remaining b% to the publisher • The comparative analysis shows that even though retail price of e-books cost lesser than their printed counterparts, the payments made to different heads are also less which makes the end revenues generated by the publisher is more than the physical books XX
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SAMPLE
E-book – Formats & Software (-/-)
Format and Software XX •X •X •X
Format and Software XX •X •X •X
Format and Software XX •X •X •X
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E-books will penetrate proportionately with the rise in internet penetration and its users
SAMPLE
Increase in internet users
Impact
• Xx • Xx • Xx • Xx • Xx • Xx • xx
Number of Broadband Subscribers – India
Total Internet Subscribers – India mn
mn
F E
x1
x2
x3
x4
D y2
C
D
C
y3
y4
B
B
A
A 0
y1
0 Jul - Sep 2013
Oct - Dec 2013 e
Jan - Mar 2014e
Apr - Jun 2014 e
Jul - Sep 2013
E-BOOKS MARKET IN INDIA 2015.PPT
Oct - Dec 2013 e
Jan - Mar 2014e
Apr - Jun 2014 e 10
As Indians open up to newer innovations, e-books evolve as an addition to online shopping list
SAMPLE
Demographical alterations
Impact
• Xx • Xx • Xx • Xx • Xx • Xx
Average Time Spent on Internet – Age-wise
Internet Users – Age-wise Distribution (2014) C
D
bn minutes
B A
B A
E
C D E
aa
C B A
X1
X2 X3
0
X4
X5
15-24 years 25-34 years 35-44 years 45-54 years 55+ years E-BOOKS MARKET IN INDIA 2015.PPT
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High prices of e-book readers acts as serious impediments for a rapid off-take of e-books High prices of e-book readers
SAMPLE
Impact
•X •X •X •X •X •X •X •X
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This bill details on the copyright mechanism especially when digital copy gets imported
SAMPLE
The Copyright (Amendment) Bill, 2010
•A •B •C •D
•X •Y •Z
•A •B •C
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Approval from majors open gates for device manufacturers to feature e-books on their devices Application approval from Apple
SAMPLE
• Xx • Xx • Xx • Xx
Features xx xx
T R E N D
xx
•x •x •x
xx xx xx
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Trends reveal that foreign giants are setting up stores in the country and introducing cheap product offerings Foreign giant setting stores in India
SAMPLE
• xx • xx
This initiative spells a positive trend as majors focus on this emerging market Point B
Point A • Xx • Xx
• Xx • Xx
Point D
Point C • Xx • Xx
• Xx • Xx
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SAMPLE
Porter’s Five Forces Analysis
Threat of New Entrants
Impact X
•X Impact X
Impact X
Bargaining Power of Suppliers •X
Impact X
Bargaining Power of Buyers
Competitive Rivalry •X
•X
Impact X Threat of Substitutes •X
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Competitive Benchmarking (-/-)
SAMPLE
Key Ratios of Top 3 Companies – Operational Basis (FY 2013) (-/-) Operating Margin
%
20
x1
10
Net Margin
x2
0 x1
-10
x2
x1 x1
-20 Company A
Company B
x2
x2
Company C
Company D
• XX • XX • XX
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Private: Foreign Company – Company A (-/-) Company Information
Corporate Address
SAMPLE Offices and Centres – India
XX New Delhi
Tel No.
XX
Website
XX
Year of Incorporation
XX Head Office
Products and Services Category
Products/Services XX
Key People Name
Designation
XX
XX
XX
XX
XX
XX
XX
XX Note: The list of products and services is not exhaustive
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Private: Foreign Company – Company A (-/-)
SAMPLE
Shareholders of the Company Name
Ownership Structure
No. of Shares held
Cengage Learning Holdings BV
1,832,268
Cengage Learning Hong Kong Ltd.
1
Total
1,832,269
Foreign Holdings
100.00%
Note: Shareholding pattern as on AGM dated 26th Sep 2014 E-BOOKS MARKET IN INDIA 2015.PPT
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Private: Foreign Company – Company A (-/-)
SAMPLE
Financial Snapshot
Key Ratios
Total Income INR mn 400
Particulars
Net Profit/Loss INR mn
26.8
26.8
29.3
30
300 200 100
20
307.6
292.9
345.3
10
0
0 2011
2012
2013
Financial Summary
2013
2012
2011
0.52
11.48%
10.96%
7.38%
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
-0.66
8.47%
9.13%
8.70%
-0.97
12.81%
13.78%
13.12%
-1.00
14.45%
15.45%
18.28%
1.05
19.59%
18.54%
15.50%
0.30
22.65%
22.35%
21.64%
2.88
11.88%
9.00%
9.02%
160.88
742.32%
581.45%
283.37%
Operating costs (% of Sales)
-0.36
88.37%
88.72%
92.17%
Administration costs (% of Sales)
N.A.
N.A.
N.A.
N.A.
Interest costs (% of Sales)
N.A.
N.A.
N.A.
N.A.
Cost Ratios
• The company reported a total income of INR 345.3 mn in FY 2013, as compared to INR 292.9 mn in FY 2012
Liquidity Ratios
• The company incurred a net profit of INR 29.3 mn in FY 2013, as compared to net profit of INR 26.8 mn in FY 2012
Leverage Ratios
• The company registered an operating margin of 11.48% in FY 2013, as compared to 10.96% in FY 2012
y-o-y change (2013-12)
Current Ratio Cash Ratio Debt to Equity Ratio Debt to Capital Ratio Interest Coverage Ratio
31.12%
2.35
1.79
2.01
-13.94%
0.50
0.59
0.41
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
23.73%
63.80
51.57
36.21
27.88%
1.02
0.80
1.15
27.68%
1.12
0.88
1.39
-1.80%
1.95
1.98
2.77
2.38%
1.68
1.64
1.98
Efficiency Ratios Fixed Asset Turnover Asset Turnover Current Asset Turnover Working Capital Turnover Capital Employed Turnover
Improved
E-BOOKS MARKET IN INDIA 2015.PPT
Decline
20
Private: Foreign Company – Company A (-/-)
SAMPLE
Business Highlights Description
News
Overview
XX
E-books
XX
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Private: Foreign Company – Company A (-/-)
SAMPLE
XX
XX
S
W
Strength
Weakness
O
T
Opportunity
Threat
XX
XX
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SAMPLE
Strategic Recommendations (-/-) Point A
•X •X •X •X •X
Point B •X •X •X •X •X •X
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Thank you for the attention The E-books Market – India 2015 report is a part of Netscribes, Inc.’s Information Technology Industry Series. For more detailed information or customized research requirements please contact:
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