Market Research Report : Used car market in india 2015 - Sample by Netscribes, Inc.

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Used Car Market â&#x20AC;&#x201C; India April 2015

Executive Summary

Market

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 Used car market in India, is currently pegged at around a mn units as per sales volumes  The used car segment is a major part of the Indian automobile industry, an industry which contributes to nearly 22% of the country’s manufacturing GDP  Poised to grow at a CAGR of b-c%, the used car segment is expected to grow at a higher rate than the new car segment  The market is majorly dominated by the unorganized sector, however, organized players have been penetrating rapidly since the last five years  Preference for used cars is much influenced by price range, brand and model, type of dealers and qualitative factors like personal experience, view of family/friends and outcome of test drive

Drivers

Drivers & Challenges

 Favorable Demography and a Healthy Economic Outlook  Growing Interest of Organized Players in the Market  Growing Automotive Industry  Online Portals and Increased Internet Penetration  Availability of More Advanced Cars Driving Preowned Market

Challenges  Impressive Offers on New Cars Posing Threat to Used Car Market  Constantly Fluctuating Fuel Prices  Cumbersome Process

Major Players

Competition

Player 1

Player 2

Player 3

Player 4

Player 5

Player 6

USED CAR MARKET IN INDIA 2015.PPT

•Macroeconomic Indicators •Introduction •Market Overview •Recent Developments •Drivers & Challenges •Competitive Landscape •Direct Investment Scenario •Strategic Recommendation •Appendix USED CAR MARKET IN INDIA 2015.PPT

Macroeconomic Indicators (1/3) GDP at Factor Cost: Quarterly INR tn

Q2 2011-12

2012-13

Q3 2014-15

2013-14

Inflation Rate: Monthly %

Jul 2013 - Aug 2013

Aug 2013 - Sep 2013

Sep 2013 - Oct 2013

Oct 2013 - Nov 2013

USED CAR MARKET IN INDIA 2015.PPT

Nov 2013 - Dec 2013

Used cars, the new business instrument of Indian auto sector has carved a niche as a potential area of growth

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Automobile Industry Overview – India • India's automobile industry is considered to be one of the fastest growing sectors in the world  Globally, India holds the 6th position when it comes to auto sales  By 2020, Indian roads are expected to cruise the weight of nearly 9 mn new cars in addition to the billions of vehicles that already exists  As per recent trend based on the mindset of the average Indian population, used car market is the most promising space for auto sales in the future  The segment puts automobiles to refurbish and reuse thus contributing responsibly towards a cleaner earth

• Though sales of new cars remain sluggish, the secondhand car market is increasingly turning into a welcome source of revenue for car makers

Worldwide Car Sales in 2014* mn units

Europe Russia

USA

Japan

Brazil

India

China

New Car vs. Used Car Sales in India New Car

Used Car

mn units

• Prudence of having a used car division has already been realized by Volkswagen, Ford, Toyota, Hyundai, Tata, Maruti Suzuki, and even by luxury car maker MercedesBenz

2009

2013

Note: *Figures correspond to light vehicles registration from Jan to Nov, 2014, Unless otherwise mentioned all figures are for financial year Apr to Mar

USED CAR MARKET IN INDIA 2015.PPT

Factors such as increasing share of organized companies in the business, people switching cars sooner,…

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Used Car Market – Overview (1/2) • Text

Used Car Market – Market Size and Growth mn units X%

2013

2014e

2015e

2016e

2017e

2018e

Note: Market size corresponds to passenger vehicles only, Figures are for financial year Apr-Mar

USED CAR MARKET IN INDIA 2015.PPT

â&#x20AC;Ślower prices in the segment and easy availability of loans are likely to boost demand for second hand cars

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Used Car Market â&#x20AC;&#x201C; Overview (2/2) Segmentation Based on Qualitative Factors

Segmentation Based on Price and Brand

Expected Industry Growth Based on Price Range

Preference of Buyers Depending on the Type of Seller

Note: The various segmentations regarding consumer preference apart from expected industry growth correspond to a market survey conducted on used car market in the United Kingdoms

USED CAR MARKET IN INDIA 2015.PPT

Investment in Automotive Sector

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FDI Regime â&#x20AC;&#x201C; Automotive Industry Total FDI Equity Inflows over the Years - Overall INR bn

2009

FDI in Automotive Sector INR bn

2010

2011

2012

2013

2014

2014 (Apr-Jul)

Top 8 sectors Attracting FDI in India (2014) INR bn

Service Sector

Construction Telecommunication Computer Drugs and Development Hardware Pharmacueticals and Software USED CAR MARKET IN INDIA 2015.PPT

Automotive Industry

Chemicals (Other than Fertilizers)

Power

Drivers & Challenges

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Drivers

Challenges

Favorable Demography and a Healthy Economic Outlook

Impressive Offers on New Cars Posing Threat to Used Car Market

Growing Interest of Organized Players in the Market

Constantly Fluctuating Fuel Prices

Growing Automotive Industry

Cumbersome Process Repelling Customers

Online Portals and Increased Internet Penetration Availability of More Advanced Cars

USED CAR MARKET IN INDIA 2015.PPT

Strong growth of new cars is expected to generate a consistent demand for them, thus necessitating…

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Growing Automotive Industry (1/2)

Impact

• Text

Domestic Automotive Sales mn units Y%

2008

2009

2010

2011

2012

2013

2014

Note: Automotive sales figures is for all car segments

USED CAR MARKET IN INDIA 2015.PPT

…a market for the re-use and refurbishment of the old stock at a constant rate

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Growing Automotive Industry (2/2) Rising Passenger Vehicle Production

Commercial Vehicles*

‘000 units

2009

2010

2011

2012

2013

2014

2009

Growing Automotive Industry Turnover

2010

2011

2012

2013

2014

Two and Three Wheelers

INR tn ‘000 units D%

2013

2009

2016e

2010

2011

2012

2013

2014

Note:*Commercial vehicles include small, light, medium and heavy commercial vehicles

USED CAR MARKET IN INDIA 2015.PPT

Launch of new cars at low prices and unlimited choice in the same affecting the demand for used cars

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Impressive Offers on New Cars Posing Threat to Used Car Market

Impact

â&#x20AC;˘ Text

New Launches

On Sale Date

Price (INR mn)

Genre

Nissan Datsun Go

Hatchbacks

Honda New Jazz

Hatchbacks

Chevrolet Beat Facelift

Hatchbacks

Maruti New Celerio

Hatchbacks

Tata Indica Vista Facelift

Hatchbacks

Hyundai New i20

Hatchbacks

Tata Manza Facelift

Saloons

Fiat Linea Facelift

Saloons

Hyundai compact saloon

Saloons

Renault Duster Facelift

SUV

Datsun Go+

MPV

Honda Mobilio

MPV

Note: The list is not exhaustive, SUV: Sport Utility Vehicle, MUV: Multi Utility Vehicle)

USED CAR MARKET IN INDIA 2015.PPT

Porter’s Five Forces Analysis

SAMPLE Impact

Threat of New Entrants • Text

Impact

Impact Impact Competitive Rivalry Bargaining Power of Buyers

Bargaining Power of Suppliers • Text

• Text

Impact

Threat of Substitutes • Text

USED CAR MARKET IN INDIA 2015.PPT

Competitive Benchmarking (2/5)

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Key Ratios of Top 3 Companies – Operational Basis (FY 2014) (1/3) Gross Margin

Player 1

Operating Margin

Player 2

Net Margin

Player 3

• Text

USED CAR MARKET IN INDIA 2015.PPT

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Public: Domestic Company – Player 1 (1/5) Company Information

Offices and Centres – India

Corporate Address

Tel No. Fax No. Website Year of Incorporation

Head Office

Ticker Symbol Stock Exchange

Products and Services Category

Products/Services

Key People Name

Designation

Sectors (EPC)

USED CAR MARKET IN INDIA 2015.PPT

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Public: Domestic Company – Player 1 (2/5) Financial Snapshot Total Income

Key Ratios Net Profit/Loss

Particulars

INR mn

y-o-y change (2014-13)

2014

2013

2012

2011

Profitability Ratios Operating Margin Net Margin Profit Before Tax Margin Return on Equity Return on Capital Employed

2011

2012

2013

Return on Working Capital

2014

Return on Assets Return on Fixed Assets

Financial Summary • The company earned a net profit of INR - mn in FY 2014, as compared to net profit of INR - mn in FY 2013 • The company reported total income of INR - mn in FY 2014, registering an increase of -% over FY 2013 • The company earned an operating margin of -% in FY 2014, an increase of - percentage points over FY 2013

• The company reported debt to equity ratio of - in FY 2014, registering an increase of -% over FY 2013

Key Financial Performance Indicators Indicators

Value (13/01/2015)

Market Capitalization (INR mn) Total Enterprise Value (INR mn) EPS (INR)

PE Ratio (Absolute)

Cost Ratios 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

Note : This company has had a fiscal year change on Dec-31, 2011

Improved

USED CAR MARKET IN INDIA 2015.PPT

Decline

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Public: Domestic Company – Player 1 (3/5) Key Business Segments

Key Geographic Segments

Automotive

Information Technology Services

Farm Equipment

Others

India

Overseas

% %

2011

2012

2013

2014

2011

2012

2013

2014

Business Highlights (1/2) Description

News

Overview

• Text

USED CAR MARKET IN INDIA 2015.PPT

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Public: Domestic Company – Player 1 (4/5) Business Highlights (2/2) Description

News

Automotive

• Text

Other Business Spheres

• Text

Acquisitions and Achievements

• Text

USED CAR MARKET IN INDIA 2015.PPT

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Public: Domestic Company – Player 1 – SWOT Analysis (5/5)

• Text

T • Text

• Text

Note : LCV: Light Commercial Vehicles; HCV: Heavy Commercial Vehicles

USED CAR MARKET IN INDIA 2015.PPT

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Private: Foreign Company – Player 2 (1/5) Company Information

Offices and Centres – India

Corporate Address Tel No. Fax No. Website Year of Incorporation

Head Office

Products and Services Category

Products/Services

Key People Sectors (EPC)

Name

USED CAR MARKET IN INDIA 2015.PPT

Designation

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Private: Foreign Company â&#x20AC;&#x201C; Player 2 (2/5) Shareholders of the Company

Ownership Structure Foreign Holdings

Name

No. of Shares held

Total

100.0% 100%

Ownership structure corresponds to Date of AGM: 30/09/2014

USED CAR MARKET IN INDIA 2015.PPT

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Private: Foreign Company – Player 2 (3/5) Financial Snapshot Total Income

Key Ratios Net Profit/Loss

Particulars

INR mn

2011

2012

2013

2014

Financial Summary

2013

2012

2011

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 2014, registering an increase of -% over FY 2013

Leverage Ratios

• The company reported debt to equity ratio of - in FY 2014, an increase of -% over FY 2013

2014

Profitability Ratios

• The company incurred a net loss of INR - mn in FY 2014, as compared to net loss of INR - mn in FY 2013

• The company earned an operating margin of -% in FY 2014, an increase of - percentage points over FY 2013

y-o-y change (2014-13

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

USED CAR MARKET IN INDIA 2015.PPT

Decline

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Private: Foreign Company – Player 2 (4/5) Business Highlights Description

News

Overview

• Text

Services

• Text

USED CAR MARKET IN INDIA 2015.PPT

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Private: Foreign Company – Player 2 – SWOT Analysis (5/5)

• Text

USED CAR MARKET IN INDIA 2015.PPT

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Direct Investments – Player 1

CD Investments – Geography-wise

Total Investments – Sector-wise Consumer Discretionary Industrials Financials

Asia/Pacific

Information Technology

Europe

Materials

Africa/ Middle East

Energy

United States and Canada

Consumer Staples

Latin America and Caribbean

Telecommunications Service

CD Investments – Segment-wise

Investment Snapshot • Text

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

100

Automobile and Components Retailing Consumer Services Media USED CAR MARKET IN INDIA 2015.PPT

Company Specifics (1/2)

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Recently Disclosed Industry Specific Strategic Alliances within the Last Two Years Company

Strategic Alliance

Primary Industry

Player 1

Player 2

Player 3

USED CAR MARKET IN INDIA 2015.PPT

Strategic Recommendation (3/4)

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Consumer Insights Certified Pre-Owned (CPO)

Non-certified Pre-Owned

Private Party

Overall

Condition

Inspection

Warranty

Financing

USED CAR MARKET IN INDIA 2015.PPT

Thank you for the attention Used Car Market – India report is part of Netscribes’ Automotive and Logistics Series. For any queries or customized research requirements please contact: Phone: E-Mail:

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USED CAR MARKET IN INDIA 2015.PPT