Waste Management – India February 2015
Executive Summary Market
Drivers & Challenges
Trends Government Initiatives
Waste management market in India was valued INR x bn in 2013 and is expected to reach INR y bn by 2018 India is a growing market for waste management services as per capita waste generation is increasing Drivers: Increasing Urbanization Initiatives taken at corporate level Government & NGOs Initiatives Increased Awareness Regarding Environmental Hazards Operational Advantages in India
Challenges: Lack of Collection and Segregation at Source Scarcity of Land Lack of Interest amongst Consumers
Major Contributors: Metros and Class A cities Increasing Interest in Waste-to-Energy projects Rules for Waste Management Major thrust to waste management through state and central pollution control boards Major Players
Competition
Company A
Company B
Company C
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
Company D
2
•Macroeconomic Indicators •Market Overview •Business Opportunities •Drivers & Challenges •Trends •Government Regulations •Competitive Landscape •Strategic Recommendations •Appendix WASTE MANAGEMENT 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
2012-13
Q3 2013-14
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
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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India is a growing market for waste management services as per capita waste generation is increasing Market Overview • Due to tremendous growth in the Indian economy and high consumption rate, waste management services is rising steadily • Indian waste management market is currently pegged at INR x bn and is expected to grow at a CAGR of xx% till 2018 • Currently, waste management in India largely refers to picking up waste from residential and industrial areas and dumping it at landfill sites • In most cities, waste collection is usually done on a contract basis by rag pickers, small-time contractors and municipalities
Waste Management – Revenue Opportunity
Waste Generation Trend Per Capita Waste Generation
INR bn
grams/day XX
E D
C
a1
a2
a3
a4
a6
a5
D C B
B A
A
0
0 2013
2014e
2015e
a5
2016e
2017e
2018e
a1
1971
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
a2
a3
a4
1981
1991
1997
2025e 5
Trend of urbanization has a played significant role in the enhancement of municipal waste generation in India Municipal Solid Waste (MSW)
MSW Generation, Collection and Treatment
• XX
Tonnes Per Day (TPD)
• XX
C
• XX • XX
B
• XX
A
a1 a2 a3
0 Generation
Urban local bodies spend between INR 500-1,500 per ton on solid waste management
Collection
Treatment
x
MSW Composition X
X
Organic Waste
y
Less than X% on treatment and disposal
Non Organic Waste z
Recyclable
Essential to prevent environment pollution ”Note: According to Central Pollution Control Board (CPCB) report 2012-13
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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SAMPLE
…every component of the waste to energy value chain MSW to Energy Value Chain (2/2)
Business Opportunities (2/2)
Transportation and Logistics
• XX • XX
MSW to energy recovery
• XX • XX
Waste Management at Dumpsite
• XX • XX
Organization/financing
• XX • XX
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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Various companies will be benefitted in each part of the waste to energy value chain
SAMPLE
Components In Value Chain
Companies that could benefit from the Waste to Energy sector
Primary Collection and Segregation
• X
Separation of Wet Organic Wastes
• X
Transport and Logistics
• X
Storage and Secondary Collection
• X
Waste Recycling
• X
MSW Waste to Energy Recovery
•X
Management of Waste at Landfills
• X
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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Increasing urbanization has resulted in considerable increase in the volume of waste generated in India Increasing urbanization
Impact
• Developing countries, like India, are witnessing massive migration of population from rural areas to urban areas • Post Independence era, while the population of India had grown three times, urban population grew five times • About one-third of urban India lives in metropolitan cities which has a million plus population • Increasing urbanization has put pressure on facilities like transport services, housing and drainage
SAMPLE
Population Growth and Impact on Overall Urban Waste Generation Year
Population (mn)
Total Waste generation (‘000 Tonnes/year)
2001
X
X
2011
X
X
2021e
X
X
2031e
X
X
2036e
X
X
2041e
X
X
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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Lack of collection and segregation at source and scarcity of land impede industrial growth Lack of Collection and Segregation at Source
Impact
• Primary collection of waste is not done at the place of generation The collection bins used in various cities are not properly designed Moreover, bins have not been installed at proper locations resulting in poor collection efficiency
• Storage of waste at source is lacking
SAMPLE
Domestic waste thrown on streets Construction debris left unattended Bio-medical waste disposed in municipal stream Industrial waste disposed off in open areas
• Precious metals and plastic which could have been recovered are more often than not destroyed as segregation of wastes hasn’t been done properly; e-wastes are dealt in a similar way as that of municipal and biomedical wastes
Scarcity of Land
Land required for MSW Disposal
• Land requirement for disposing municipal waste will rise from 200 sq. km. in 2011 to 1,400 sq. km. in 2047 • The urban areas, which have the largest concentration of MSW, are also the most landscarce, and therefore, the opportunity cost of using such land for MSW disposal is also very high
Years
Land Required (SqKm)
City Equivalents
X
X
X
X
X
X
X
X
X
X
X
X
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
Impact
10
Metropolitan cities and Class A cities generate over x% of waste in India Major Contributors: Metros and Class A cities • India produces around x lakh MT of e-waste per year
A handful of cities account for the majority of waste generated
Mumbai generates nearly 61,000 tonnes of electronic waste per year followed by New Delhi, which generates 43,000 tonnes of waste Bangalore ranks third in terms of e waste generation and produces nearly 37,000 tonnes of waste per year
SAMPLE
• Cities are getting more and more crowded resulting in more generation of waste • Lot of people are migrating from villages to cities in search of jobs
Solid Waste Generation Share*
Solid Waste Generation in Metro Cities*
B
Mumbai
y
x
A
a1
Kolkata
a2
Delhi
a3
Chennai z Metro Cities
Class A Cities
a4
Hyderabad Others
Bengaluru
C
Tonnes Per Day
0
a5 a6
Note: Waste generation quantities in 2011; Class A cities: Population Range: 1,00,000 – 4,999,999
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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Pollution control boards are responsible for prevention and control of environmental pollution XX
X
X
• XX • XX • XX • XX • XX
SAMPLE Rules for Waste Management
Waste Types
Rules
Biomedical Waste
• XX • XX • XX
Municipal Solid Waste
• XX • XX
E Waste
• XX
Hazardous Waste
• XX
Batteries
• XX
Re-cycled Plastic Waste
• XX WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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PPP’s have helped in improving efficiency and effectiveness due to better management and strong investments • XX • XX
Public Private Partnership
xx xx Xx Xx Xx xx
City/State X
SAMPLE PPP Initiative
•X •X
X
•X •X •X •X
X
•X •X •X •X WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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Porter’s Five Forces Analysis
SAMPLE Impact XX
Threat of New Entrants •X
Impact XX Competitive Rivalry
Impact XX
Impact XX
•X Bargaining Power of Suppliers •X
Bargaining Power of Buyers •X
Threat of Substitutes
Impact XX
•X
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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Competitive Benchmarking (1/5)
SAMPLE
Public Trading Comparables
Company A
Market Capitalization (INR mn)
• XX
Share Price (INR)
• XX
EV/EBITDA (x)
• XX
EV/Revenue (x)
• XX
Note: Market Capitalization, Share Price as of 30/12/2014 WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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SAMPLE
Competitive Benchmarking (X/X)
Key Ratios of Top 3 Companies – Operational Basis (FY 2013) (X/X) Operating Margin
%
Net Margin
a1
10
a2
5
c1
c2
0 -5 -10
b2
b1 Company A
Company B
Company C
• XX • XX • XX • XX • XX
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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Public: Domestic Company – Company A(x/x) Company Information Corporate Address
• XX
Tel No.
• XX
Fax No.
• XX
Website
• XX
Year of Incorporation
• XX
Ticker Symbol
• XX
Stock Exchange
• XX
SAMPLE Offices and Centres – India
Mumbai Head Office
Products and Services Category
Waste Management Services
Products/Services
• XX
Key People Name
Designation
• XX
• XX
• XX
• XX
• XX
• XX
• XX
• XX
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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Public: Domestic Company – Company A (x/x)
SAMPLE
Financial Snapshot Total Income
INR mn 300
Net Profit/Loss
INR mn
7.0
8 3.7
200 100
Key Ratios
167.6
172.8
3.0
6.4 220.0
285.1
6 4 2
0
0
2011
2012
2013
2014
Financial Summary
Particulars
y-o-y change (2014-13)
2014
2013
2012
2011
-2.50
5.69%
8.19%
7.48%
8.61%
-1.86
1.05%
2.91%
2.14%
4.19%
-2.23
1.81%
4.04%
2.71%
5.10%
-1.02
0.95%
1.98%
1.35%
2.56%
-0.31
3.92%
4.23%
3.65%
4.43%
-23.46
17.04%
40.50%
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
-192.48% 24.43%
-0.32
2.74%
3.06%
2.69%
3.46%
-1.67
10.40%
12.07%
11.09%
127.34%
1.86
93.65%
91.79%
92.52%
91.39%
0.32
11.69%
11.38%
10.87%
7.80%
0.28
2.98%
2.70%
2.89%
0.99%
Cost Ratios
• The company earned a net profit of INR 3.0 mn in FY 2014, as compared to net profit of INR 6.4 bn in FY 2013 • The company reported total income of INR 285.1 mn in FY 2014, registering an increase of 30% over FY 2013 • The company earned an operating margin of 5.69% in FY 2014, a decrease of 2.26 percentage points over FY 2013 • The company reported debt to equity ratio of 0.50 in FY 2014, an increase of 20.68% over FY 2013
Key Financial Performance Indicators Indicators
Value (30/12/2014)
Market Capitalization (INR bn) Total Enterprise Value (INR mn) EPS (INR) PE Ratio (Absolute)
631.53 780.857 0.31 116.22
Operating costs (% of Sales) Administration costs (% of Sales) Interest costs (% of Sales)
Liquidity Ratios Current Ratio Cash Ratio
20.42%
1.54
1.28
0.95
1.64
-12.23%
0.32
0.37
0.34
0.61
20.68%
0.50
0.42
0.52
0.27
Leverage Ratios Debt to Equity Ratio Debt to Capital Ratio Interest Coverage Ratio
13.77%
0.33
0.29
0.34
0.21
-29.96%
2.13
3.04
2.59
8.71
11.41%
1.64
1.47
1.48
14.78
15.64%
0.43
0.37
0.36
0.40
-12.06%
0.94
1.06
1.45
1.11
-45.60%
2.68
4.93
-25.72
2.84
13.53%
0.54
0.48
0.42
0.48
Efficiency Ratios Fixed Asset Turnover Asset Turnover Current Asset Turnover Working Capital Turnover Capital Employed Turnover
Improved
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
Decline
18
Public: Domestic Company – Company A (x/x)
SAMPLE
Key Business Segments
Key Geographic Segments* India
e-Waste Management & Recycling x
100% 80% 60% 40%
The company has earned revenues from e-waste Management and Recycling segment only for the last 4 fiscals
80% 60% 40%
20%
20%
0%
0%
2014
The company has earned revenues from India only for the last 4 fiscals
100%
x
2012
Business Highlights Description
News
Overview
• • • •
Current and Pending Investors
• XX
Future Plan
• XX
XX XX XX XX
Note: Due to lack of critical data, the graph could not be generated for the year 2014
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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Public: Domestic Company – Company A – SWOT Analysis (x/x)
SAMPLE
• XX
• XX
S
W
O
T
• XX
• XX
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Private: Domestic Company – Company B (x/x) Company Information
Corporate Address
XX
Tel No.
XX
Fax No.
XX
Website
XX
Year of Incorporation
XX
SAMPLE Offices and Centres – India
Ahmedabad Head Office
Products and Services Category
Products/Services
Key People Water and Wastewater Management
XX
Name
Designation
XX
XX
XX
XX
XX
XX
XX
XX
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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Private: Domestic Company – Company B (x/x) Shareholders of the Company as on 28.09.2012 Name
No. of Shares held
Doshion Pvt. Ltd.
3,500,000
Veolia Water Solutions & Technologies
1,500,000
Total
SAMPLE Ownership Structure
Corporate Bodies
Foreign holdings
30%
5,000,000
70%
Note: AGM as of 28th Sep 2012 WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
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Private: Domestic Company – Company B (x/x)
SAMPLE
Financial Snapshot
Key Ratios
Total Income
Particulars
Net Profit/Loss
INR mn
INR mn
1000
27.7
800
20
2.3
600 400 200
40
0
-25.8 518.5
887.1 456.2
0
2010
2011
460.9 -49.1 2012
-20 -40 -60
2013
Financial Summary
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
2011
2010
13.96
3.31%
-10.65%
0.51%
-4.98%
13.77
3.13%
-10.65%
0.51%
-4.98%
13.96
3.31%
-10.65%
0.51%
-4.98%
10.90
2.50%
-8.41%
0.41%
-6.67%
5.27
1.50%
-3.78%
0.28%
-4.39%
-16.05
4.89%
20.94%
0.37%
-4.22%
4.64
1.28%
-3.37%
0.28%
-3.34%
495.15
161.62% -333.53%
16.45%
-142.77%
-13.96
96.69%
110.65%
99.49%
104.98%
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
110.65%
1.54
0.73
4.68
6.09
223.13%
0.41
0.13
0.64
2.02
-37.34%
0.77
1.22
0.47
0.52
-21.13%
0.43
0.55
0.32
0.34
N.A.
N.A.
N.A.
N.A.
N.A.
55.83%
48.81
31.32
32.02
28.69
21.86%
0.39
0.32
0.54
0.67
-28.39%
0.52
0.72
0.57
0.71
-175.09%
1.48
-1.97
0.72
0.85
1.07%
0.80
0.79
0.80
1.34
Cost Ratios Operating costs (% of Sales) Administration costs (% of Sales) Interest costs (% of Sales)
Liquidity Ratios
• The company reported total income of INR 887.1 mn in FY 2013, registering an increase of 92.5% over FY 2012
Leverage Ratios
• The company reported debt to equity ratio of 0.77 in FY 2013, a decrease of 37.34% over FY 2012
2012
Profitability Ratios
• The company earned a net profit of INR 27.7 mn in FY 2013, as compared to net loss of INR 49.1 mn in FY 2012
• The company earned an operating margin of 3.31% in FY 2013, an increase of 13.96 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
WASTE MANAGEMENT MARKET IN INDIA 2015.PPT
Decline
23
Private: Domestic Company – Company B (x/x)
SAMPLE
Business Highlights Description
News
Overview
XX
Network
XX
Awards
XX
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Private: Domestic Company – Company B – SWOT Analysis (5/5)
SAMPLE
XX
XX
S
W
O
T
XX
XX
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