market research report :water and wastewater management in india 2013

Water and Wastewater Management (WWWM) IndiaWater and Wastewater Management (WWWM) – India

July 2013

Executive Summary

Market

Indian water and wastewater management market is currently valued at INR x bn It is expected to grow with a CAGR of y% till 20‐‐Many small players are entering the marketWWW treatment demand arises primarily from three major sectors: Agricultural, industrial and domestic Industrial water treatment is expected to drive this market in the future

Drivers & Challenges

Industrial water treatment is expected to drive this market in the future

Drivers– Rising Population and Urbanization– Rapid Industrialization– Chronic Ground Water Contamination

Challenges– Poor Infrastructure– Water Pricing Mechanism– Unaccounted‐for WaterChallenges Chronic Ground Water Contamination

– Fluctuations in Ground Water Level – Operational Advantages in India

Unaccounted for Water

Government Bodies and

Requirement for Efficient Governance of Water Flow of Authority of Water Institutions in India

Institutional Framework in Urban Water Supply Zth Five Year Plan Investments

Recent D l t

DIWALI Concept Entry of Foreign Players

Bodies and Initiatives

y Incentive Structure Policy Measures by Government of India

Increasing Government Thrust Jawaharlal Nehru National Urban Renewal Mission

Developments

Competitive Landscape

Popularity of PPP Model

Major Players

Player A Player B Player C

Player D Player E Player F

2WATER AND WASTEWATER MANAGEMENT IN INDIA 2013.PPT

Player D Player E Player F

•Macroeconomic Indicators•India’s Water Situation

d i•Introduction•Sectoral Demand for Water•Market Overview•Market Overview •Wastewater Treatment Techniques•Drivers & Challenges•Drivers & Challenges•Government Bodies and Initiatives•Recent Developmentsp•Competitive Landscape•Market Entry


•Appendix

SAMPLE Economic Indicators (1/3)

Gross Fiscal Deficit: Monthly

600

500

INR bnx6

x5x3500

400

300

200

100

x4

x3

x2

x1

Exchange Rate: Monthly

100

0Month ‐‐Month ‐‐Month ‐‐Month ‐‐Month ‐‐Month ‐‐

g y

55.0x2

USD/INR

x1

54.0

54.5 x3 x6

x2x5

x4

4

53.5Month 20‐‐Month 20‐‐ Month 20‐‐ Month 20‐‐Month 20‐‐Month 20‐‐

WATER AND WASTEWATER MANAGEMENT IN INDIA 2013.PPT

SAMPLEDifferent water quality standards are laid out by the Regulatory Authorities in India

SAMPLE Indian Water Quality Standards

Class of water

Designated‐Best‐Use Criteria/Specificationswater

X1 Segments • Point 1• Point 2• Point 3• Point 4


X3 Segments • Point 1X3 Segments Point 1• Point 2• Point 3• Point 4




• Point 4

Below X6 Segments • Point 1

WWWM goods & services facilitates the process of removal, treatment and reuse/disposal of wastewater

Water and Wastewater Management – Introduction (2/2)

Wastewater Goods and Services Wastewater Treatment Procedures

•Point 1•Point 2

X Y Z

A •Point 3•Point 4•Point 5 • X1

• X2

• Y1

• Y2

• Z1

• Z2

•Point 1

• X3

• X4

• X5

• X6

• Y3

• Y4

• Z3

• Z4

B

•Point 2•Point 3•Point 4•Point 5•Point 6

X6

• X7


Point 6•Point 7 Point 1

Agricultural sector is the largest consumer of water in the form of irrigation

Current Water Usage Pattern in India : Market Forces at Work

Key Market Boosters Key Issues

Segment A• Point 1

• Point 2

• Point 3

• Point 1

• Point 2

Segment B • Point 1 • Point 1

Segment C•Point 1

•Point 2• Point 1

Sustainable Water Consumption – Steps Required

Point 1

Point 2

Point 3

Water Consumption Levels in Various Countries

x2

y2 z2

y1

z1

Segment C

Segment B

Segment A


Point 3

Point 4BA

x1Segment C

Rapid urbanization and industrialization is expected to spur the Indian WWWM market

Market Size – WWWM (Value‐Wise)

INR bnx6Z% x5

x4x3x2x1

x6Z%

0

20‐‐e20‐‐e20‐‐e20‐‐e20‐‐ 20‐‐e

Wastewater Treatment DemandWastewater Treatment Demand

Z%Y%

S A

X%

Segment B

Segment A

Segment C


X%

20‐‐

Watershed development projects are an efficient tool to manage natural resources such as water Waste Water

TreatmentWater Treatment

• Point 1• Point 2

Watershed Management Fund Allocation

x4

x3x2

• Point 3

x1

P j t M t Ph

DBCA

X Phase Y Phase Z Phase

Project Management PhasesFinancing pattern of X

A

A C E

B D F

A

B


Point 1C

Wastewater treatment industry in India mainly adopts the following techniques

SAMPLE Types of Wastewater Treatment Technologies (2/2)

• Point 1A

• Point 2

B• Point 1

• Point 2

C

• Point 1

• Point 2

• Point 3

D• Point 1


• Point 2

Drivers & Challenges – Summary

Drivers Challenges

Rising Population and Urbanization

Rapid Industrialization

Poor Infrastructure

Water Pricing Mechanism

Chronic Ground Water Contamination

Fluctuations in Ground Water Level

Unaccounted‐for Water

Operational Advantages in India


Low cost makes India a very attractive destination to set up waste water management plants

ImpactOperational Advantages in India

• Finding 1

• Sub‐ Finding 1g

A•Point 1•Point 2

Sub‐Point 1

Major Operational Advantages in India

B •Point 1•Point 2

in IndiaC

•Point 1•Point 2

•Point 1


D •Point 1Sub‐point 1

Certain fundamental requirements need to be fulfilled for the institutional effectiveness of the water sector

SAMPLERequirements for Efficient Governance of Water

Water GovernanceSAMPLE Segment A Segment B

Segment X Segment Y

•X1

•X2

•X3

• Y1• Y2• Y3

•Y1

•Y2•X3

•X4

• Y3• Y4• Y5• Y6• Y7

•Y3

•Y4


Note: NRW‐ Non revenue water

Recent Developments – Summary

DIWALI Concept

Recent lDevelopments

Popularity of PPP Model Entry of Foreign Players Popularity of PPP Model y g y


The X concept is expected to address India’s water‐related challenges

X – The ‘X’ Concept (2/2)

Technology Concepts

A B C DA B C D

E F HG

I

Point 1


Competitive Benchmarking (1/5)

Public Trading Comparables (FY 20‐‐)

Company 1 Company 2 Company 3 Company 4

Market Capitalization (INR mn)

‐ ‐ ‐ ‐

Share Price (INR) ‐ ‐ ‐ ‐

EV/EBITDA (x) ‐ ‐ ‐ ‐

/EV/Revenue (x) ‐ ‐ ‐ ‐

PE Ratio ‐ ‐ ‐ ‐


Public: Domestic Company – Company A (1/4)

Company Information Offices and Centres – India

Corporate Address Address

Tel No. 91 ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐Tel No. 91

Fax No. 91 ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐

Website website

Year of Incorporation 19‐‐

Products and Services

Ticker Symbol ‐‐‐‐‐‐

Stock Exchange ‐‐‐

Key People

Products and Services

Category Products/Services

Segment Product 1, product 2, product N D i ti

Head Office

3,………………….

Others Product 1, product 2, product 3………

Name Designation

Person 1 Designation



17

, p , pPerson 4 Designation

WATER AND WASTEWATER MANAGEMENT IN INDIA 2013.PPT

i i l S h K i


Financial Snapshot Key Ratios

Particulars y‐o‐y change (2012‐11)

2012 2011 2010 2009

Profitability RatiosOperating Margin 4.18 6.63% 2.45% 7.56% 6.66%

Net Profit/LossTotal Income

60000

80000

3 000

4,000

INR mn INR mny4y1 y3y2

Net Margin ‐2.44 ‐1.27% 1.18% 0.64% 1.06%

Profit Before Tax Margin ‐3.14 ‐0.31% 2.82% 2.30% 2.89%

Return on Equity ‐8.70 ‐4.22% 4.48% 1.95% 2.94%

Return on Capital Employed 3.74 7.00% 3.26% 8.70% 7.11%

Return on Working Capital ‐13.05 ‐41.88% ‐28.83% 72.52% 84.18%

Return on Assets 1.69 3.30% 1.60% 4.41% 3.16%

0

20000

40000

60000

0

1,000

2,000

3,000

20‐‐

x4x2

20‐‐

x1

20‐‐

x3

20‐‐

Return on Fixed Assets 11.80 20.65% 8.85% 11.80% 9.74%

Cost RatiosOperating costs (% of Sales) ‐7.41 70.17% 77.58% 83.00% 84.27%

Administration costs (% of Sales)

2.55 19.38% 16.84% 6.32% 6.07%

Interest costs (% of Sales) 2.58 7.54% 4.96% 4.85% 4.76%

Financial Summary

• The company earned a net profit of INR x mn in FY 20‐‐, as compared to net profit of INR y mn in FY 20‐‐

• The company reported total income of INR y mn in FY 20‐‐, registering an increase of % over FY 20 Interest costs (% of Sales) % % % %

Liquidity RatiosCurrent Ratio ‐4.44% 0.85 0.89 1.12 1.07

Cash Ratio 7.01% 0.12 0.11 0.11 0.11

Leverage RatiosDebt to Equity Ratio 26.01% 3.65 2.90 2.24 2.26

b i l i

registering an increase of z% over FY 20‐‐

• The company earned an operating margin of y1 % in FY 20‐‐, an increase of x2 percentage points over FY 20‐‐

• The company reported debt to equity ratio of z1 in FY 20‐‐

Key Financial Performance Indicators

Indicators Value (dd/mm/yyyy)Market Capitalization (INR mn) ‐Total Enterprise Value (INR mn) ‐EPS (INR)

Debt to Capital Ratio 5.59% 0.79 0.74 0.69 0.69

Interest Coverage Ratio 71.49% 0.90 0.52 1.58 1.42

Efficiency RatiosFixed Asset Turnover ‐10.53% 3.04 3.40 1.54 1.44

Asset Turnover ‐21.14% 0.49 0.62 0.58 0.47

Current Asset Turnover ‐20.63% 1.08 1.36 1.04 0.79


EPS (INR) ‐PE Ratio (Absolute) ‐

Working Capital Turnover ‐44.31% ‐6.17 ‐11.09 9.48 12.42

Capital Employed Turnover ‐24.03% 0.70 0.92 0.93 0.84

Improved Decline


Key Business Segments Key Geographic Segments

100%

Segment A

100%

BA

Company A has earned100%

50%

0%

X

0%

50%

100%

x4

y2 y3

x3

y4

x2

y1

x1

Company A has earned revenues from this segment only for the last X fiscals

Business Highlights

0%

20‐‐

0%

20‐‐ 20‐‐ 20‐‐20‐‐

Description News

Overview

• Operates as a civil engineering construction company in Country A• Involved in designing, engineering, and building (EPC) transportation projects, including bridges, flyovers, roadways, and railways; and power projects, such as nuclear, hydroelectric, and thermal power projects, as well as executing high voltage transmission linesOverview as well as executing high voltage transmission lines

• Engages in oil exploration and realty development businesses• Has initiated talks with investors to sell up to x% stake in its listed subsidiary, Company B• Intends to amalgamate its x% power generating subsidiary Company C with itself

Certifications • It is the only Country A Construction Company to have been accredited with X for all fields of Civil


CertificationsEngineering Works including design

Various factors lead to potential water crisis in India which can be dealt with by providing solutions and opportunities

Strategic Recommendations

A B C D

• Point 1 • Point 1 • Point 1

• Point 2IONS

• Point 2

• Point 3

• Point 2

• Point 3

• Point 2

• Point 3

• Point 4

• Point 1

SOLU

TI

• Point 1• Point 1 • Point 1N

ITIES

• Point 2

• Point 3

• Point 4

• Point 1• Point 2• Point 3

• Point 1

• Point 2

• Point 3

• Point 1

OPP

ORT

UN


Thank you for the attention

Phone: +91 22 4098 7600

Water and Waste Water Management – India 2013 report is part of Netscribes’ Services Industry Series.For any queries or customized research requirements, contact us at:Phone: 91 22 4098 7600E‐Mail: [email protected]

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market research report :water and wastewater management in india 2013

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