Download - Vibrant Gujarat 2013
Vibrant Gujarat 2013
Opportunities in IT/ITeS Sector in Gujarat
Colonel Naveen Bhasin,CEO, Sai InfoSystems (India) Ltd
Contents –IT/ITeS
1 Overview – India Scenario2 Gujarat scenario3 Investment Opportunities
Overview
1Vibrant Gujarat 2013 • IT
GROWING INDUSTRYIT / ITeS industry is expected to be USD 320 billion by 2020. The CAGR for the decade (2011-2020) is pegged at 15% Domestic BPO market would increase to USD 2.5 billion by 2014The Indian electronics turnover is expected to be USD 400 billion by 2020.TRAI is targeting a 10-fold increase in broadband subscribers to 100 million by 2014 from existing 10.3 millionIndustry has also started to impact rural areas – rural BPO organizations employed more than 5,000 people in FY2009
India – IT/ITeS Scenario
LARGE INDUSTRYThe Indian IT industry is a USD 88 billion industry with 80% of the revenues coming from exports. It has been growing at a CAGR of about 17% in last 5 years (FY07-FY11).The Indian IT & ITeS sector employs over 2.5 million skilled people. Employment has been growing at a CAGR of about 20% in during FY07-FY11.The per capita GDP contribution of IT-BPO employees is about 80 times that of a person employed in the agriculture sector The IT-BPO industry currently contributes 14% to India‘s total exportsBetween 2000 and 2011, the IT/ITeS sector received cumulative FDI of USD 107 billionIndia is referred to as the back office of the world, with its strong cost advantages and skilled work force in providing ITeS.
2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 (e)
0
10
20
30
40
50
60
70
80
3140 46 50
5970
IT/ITeS exports in USD billion
Industry characteristics
• Major segments: 1. IT Services, 2. ITeS – BPO, 3. Software products and Engineering Services, 4. Hardware
Segment-size: IT services is the biggest in size (the revenue from IT services constitutes about 50% of the total industry revenues)
Segment growth: Software products & Engineering services are fastest growing (CAGR – 27.5%) and slowest growing segment is Hardware (CAGR – 17%)
• Larger companies depend more on export and smaller ones more on domestic market – hence, larger companies would prefer an SEZ over other IT space (such as an IT Park) because of export incentives provided in SEZs.
• In the future, domestic market would be the growth driver for the IT industry – even the top 10 companies’ revenue dependency on domestic market would increase.
India – IT/ITeS scenario
IT Services. 50%
ITeS - BPO. 20%
Software Products &
Engi-neer-ing Ser-
vices. 17%
Hardware. 13%P
ie
CAGR 21.8%CAGR 10.5%
CAGR 23.1%
CAGR 27.5%
Revenues of different components of IT/ ITeS Industry. CAGR for FY05 to FY 10.
IT services form the largest portion of IT/ITeS revenues
Top 1-10 Top 11-50 Top 51-1000%
20%40%60%80%
100%
67.20%40.80% 25.20%
32.80%59.20% 74.80%
Export and domestic % aggregate revenue of top 100 software vendors (FY10)
Export Domestic
Column Stacked 100 Percent
Source: NASSCOM
The total IT / ITeS industry in India should be USD 230 billion to USD 320 billion compared to about USD 90 billion today
Source: PwC analysis
Scenario DescriptionProjected
CAGR (Exports)
Projected CAGR
(Domestic)
Scenario 1 If assumed that future growth will be same as last 5 years’ CAGR (FY07-FY11)
17% 15%
Scenario 2 (Base case) If NASSCOM projections are used 13% 14%
Scenario 3 (Optimistic) If CAGR is 2% more than NASSCOM projection 15% 16%
Scenario 4 (Pessimistic) If CAGR is 2% less than NASSCOM projection 11% 12%
• We have projected the Indian IT sector demand for four different scenarios as tabulated below.
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
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50
100
150
200
250
300 Export Revenue Projections in billion
USD
Scenario 2 Scenario 1 Scenario 3 Scenario 4
Line
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
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20
40
60
80
100
120
Domestic Revenue Projections in billion USD
Scenario 1 Scenario 2 Scenario 3 Scenario 4
Line
Future outlook
Top 10 Sectors in India – FDI Inflows in 2010-11
SN Sector Net FDI1 Services (Financial and Non-Financial) $26.67 b2 IT (Hardware and Software) $10.82 b3 Telecom $10.61 b4 Housing & Real Estate $ 9.65 b5 Construction (Roads & Highways) $ 9.49 b6 Automobile $ 6.19 b7 Power $ 6.15 b8 Metals and Metallurgy $ 4.28 b9 Oil & Natural Gas $ 3.16 b
10 Chemicals (Other than Fertilizers) $ 2.92 bSource: FDI in India, 2011 Report
29
59
Growth drivers-National Policy on IT 2011
100
200
Domestic Exports
Current revenue in USD billion
in 2011
Targeted revenue in
USD billion by
2020
Enabling IT Policy
2011
Strategies formulated in the Policy to achieve targets• Creating ecosystem for a globally competitive IT/ITeS Industry • Human Resource Development • Promotion of Innovation and R&D in IT Sector • Enhancing productivity and competitiveness in key sectors
through ICT • Creating an ecosystem for Internet and mobile driven Service
Industry • Enabling Service Delivery through e-Governance • Mobile based Value added Services • Development of Language Technologies • GIS based IT Services • Security of Cyber Space
AIMS AT MAKING A CHANGE
To increase revenues of IT and ITeS Industry from USD 88 Billion at present to USD 300 Billion by 2020
To expand exports from USD 59 Billion at present to USD 200 Billion by 2020.
To create a pool of 10 million additional skilled manpower in ICT.
To make at least one individual in every household e-literate.
To provide fiscal benefits to SMEs and start-up ventures in key industrial verticals
To gain big global mkt share in cloud-based services & mobile-based value-added services
To leverage ICT for key Social Sector initiatives
To strengthen the Regulatory and Security Framework for ensuring a Secure Cyberspace ecosystem
To attract investments in IT in Tier-II & III cities
Source: Department of Electronics and Information Technology, GoI
Gujarat scenario
2Vibrant Gujarat 2013 • IT
The stretch between Ahmedabad and Gandhinagar is now being developed as a knowledge corridor. Land has been allotted and several IT parks and centres of excellence are taking shape here.
IT/ITeS – Gujarat scenario
2006-07 2007-08 2008-09 2009-10 2010-110
200
400
600
800
1000
1200
1400
564681
1268
10351150
IT exports from Gujarat in Rs. crore
Ahmedabad
Vadodara
Valsad
Gandhinagar
14 Special Economic Zones have been planned specifically for IT/ITeS – 7 are notified and 7 have secured formal approval
More than 1,000 ICT & BPO companies are operational in Gujarat.127 new companies are registered with the Commissionerate of Information Technology. More than 1,250 companies are registered with Gujarat Electronics & Software Industries Association (GESIA)IT units in Gujarat are spreading their markets from the US to other regions like Europe, Middle East and AfricaInfrastructure available at Infocity - Gandhinagar, GNFC Infotower - Ahmedabad, Astron IT Tech Park - Ahmedabad and another one is coming in Baroda
Source: http://www.gnr.stpi.in, GIL; Gujarat Electronics & Software Industries Association (GESIA), Commissionerate of Information Technology
Business friendly governance and investor friendly IT Policy & initiatives
Land Bank availability and relatively lower real estate
Skilled human resource advantage and lower cost of manpower. Lowest BPO attrition rate
Robust Physical, Social and industrial infrastructure
Lowest start-up and operational costs
Why Gujarat?
Investment opportunities
3Vibrant Gujarat 2013 • IT
Urban Living and Emergency Management Services
Cloud based services and solutions
E –Governance Initaitives
Video Telephony and Unified Communications
Urban and rural planning – using GIS, remote sensing
Knowledge Process Outsourcing
IT based education and trainings
During the Vibrant Gujarat Investment Summit 2011, 115 MoUs were signed for the IT/ITeS sector as against 20 MoUs in the 2009 Summit.
The proposed investment amounted to Rs. 68,565 crore and could provide employment to 320,000 people.
Foreign Investments proposed in the sector by USA were about Rs. 5300 crore employing 14000 people.
Investment opportunities
Investment in Rs. crore
Employment0
50000
100000
150000
200000
250000
300000
350000
46507
142992
68565
320000
2009 VG Summit 2011 VG Summit
Smart CitySmart Grids
Dis
aste
r
Man
agem
ent
SensorsSurve
illance
Das
hboa
rds
Intelligent Buildings
Homeland Security
Automation
Analytics
Urban Living – Products and Services
Disaster ManagementEOC, Alert and Messaging, UC, Planning etc.
Smart GridsPower, Water, Communication, Public Safety etc.
Intelligent BuildingsEnergy Mgmt, Home Automation, security etc.
Smart CityAggregation of all modules
Homeland SecurityTurnkey projects involving command and control centres, info gathering, analytics etc.
HLS Spend Forecast: Break-up
Source: “Homeland Security Assessment – India; Expansion and Growth” by ASSOCHAM; June 2011
Data Centres / Cloud Services – Market Size and Potential
Data Center Capacity in India (‘000 sft)
Colocation & Hosting Revenue (USD Millions)
• Current data center capacity in India at approx. 2.8 million sq. ft. (Service Providers have 55% Market Share and Captive has 45%). The same capacity is projected to increase to 6.6 million sq. ft. (Service Providers capturing 70%)
• Median Data Center size today is 2500 – 3000 sq. ft.; the industry may see consolidation of space in near future
• PUE of 2.0 may become industry standard• Outsourcing will drive growth rather than captive data centers
• Current Revenue streams from Colocation (for space and Power only) and Hosting stands at $487 million. Out of this, hosting and managed services account for < 25%. The revenue from these streams is expected to cross $1.3 billion by 2016 (Hosting and managed services to have 35% Market Share)
• Disaster Recovery could become a must have service for organizations• Hosting / Managed service will experience higher growth trajectory (26% CAGR)• Growth in Internet and online content will leverage Hosting services
Source: Gartner Research
2010 2011 2012 2013 2014 2015 20160
1000
2000
3000
4000
5000
6000
7000
Service Provider Captive
2010 2011 2012 2013 2014 2015 20160
200
400
600
800
1000
1200
1400
Colocation Hosting / Managed Services
14%22%
Healthcare Segment – Products / Services
EMRsHospital
Applications
Info
Exc
hang
eTele-M
edicine
Mobile Applications
Info. ExchangeBringing all the stakeholders in one open exchange
Hospital ApplicationsHMIS, Custom Development, Other Enterprise Level Software
EMRInter-operability, Database development etc.
Tele-MedicineSoftware, Physical Infra etc.
Mobile AppsPortable EMRs, NFC enabled interfaces, QR etc.
Energy Segment – Products / Services
SCADADistrib
ution
Franchise
Smar
t Met
ersSm
art-Grid
Sensors
Smart MetersHeavy demand projected, can be for captive use or for B2B selling
Distribution FranchiseWould provide the basic know-how and operational experience
SCADAInherent part of any distribution operations
Smart GridIT systems, turn key deployment and operations
SensorsNiche Market, usage in multiple verticals
SCADA: Supervisory Control and Data Acquisition
Agriculture Segment – Products / Services
Mobile Apps
Soil Mgmt.
Services
GIS
Map
pingG
PS solutions
Sensors
GIS MappingGIS Mapping services, land records and databases
Soil Mgmt. ServicesBased on sensors, advisory services for seeds, fertilizers, farming etc.
Mobile ApplicationsFor farmers, market, govt. agencies etc.
GPS SolutionsGPS solutions to government and private agencies
SensorsData capturing devices for all applications
Sum-up – Products and Services
Health•Hospital Applications•EMR•Mobile Applications• Information Exchange•Tele-Medicine
Energy•SCADA•Smart-Grid•Distribution Franchise•Smart Meters•Sensors
Education•E-Learning• ICT Solutions•Devices• Information Exchange•Cloud Services
Agriculture•Mobile Applications•GPS Solutions•GIS Mapping•Sensors•Soil Management Services
Urban Living•Disaster Management•Homeland Security•Smart City•Smart Grids• Intelligent Buildings
Enablers
Data Centre / Cloud Services
IP Surveillance
Event Management System
IP Communications
IT Hardware
Block No. 18, 2nd Floor, Udyog Bhavan,Sector 11, Gandhinagar, 382 017, Gujarat, INDIA
Phone: 079-23256009, 23250492/3Fax: 079-23250490
E-mail: [email protected]
Visit us at www.vibrantgujarat.com