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1 Insert Cover Image using Slide Master View Do not distort Foundry Market India January 2012

2 Executive Summary Market Foundry market in India registered production of a mn tonnes of castings in 20 In 200, India was the world s second largest producer of castings and also one of the top 10 in terms of average production per plant It was also the fastest growing top 10 nation in 200, increasing its casting tonnage by b% over 200 India currently has over c foundries in the small, medium and large scale sectors with around d units having international quality accreditation Foundry industry is a major feeder to various sectors, automobile sector accounting for the largest share Drivers & Challenges Drivers Increasing demand from automobile sector Strong economic growth Supportive government participation Low cost of labour Improving technology and modernization Challenges Market constraints Rising input costs Low capacity utilisation Future Outlook Competition t o Vision Plan 2020 for Foundry Industry Initiated by The Institute of Indian Foundrymen (IIF) to recommend initiatives for strong growth and help India emerge as a leading supplier of quality castings to the global market by 2020 VisionPlan 2020 Interventions In order to realise the Vision Plan 2020, various interventionsarerequired required which aims to benefit the entire value chain and ensure balanced growth of the foundry sector Major Players Player 1 Player 2 Player 3 Player 4 Player 5 Player 6 2

3 Introduction Market Overview Foundry Clusters Export Import Drivers & Challenges Competition Future Outlook Strategic Recommendations 3

4 Foundry market is growing consistently in India and it is the second largest producer of castings in the world Indian Foundry Market Overview In 200, India was the world s second largest producer of castings and also one of the top 10 in terms of average production per plant It was also the fastest growing top 10 nation in 200, increasing its casting tonnage by a% over 200 Indian foundry industry employs around b mn persons directly and another c mn indirectly Production of castings in India took a dip in 200 due to the global crisis, but has recovered with strong growth in 20 Growing concern regarding the quality and quantity of castings will drive the establishment of larger casting facilities in India over the next few years With growing demand from the automobile and engineering sectors coupled with India s rapidly growing economy, the foundry market is expected to grow strongly in the near future Production of Castings Growth mn MT D% e Production of Castings Segmentation Segment 1 Segment 3 Segment 5 Segment 2 Segment 4 x occupy the biggest share of total castings produced F% i%j% G%h% K% E% Source: 4

5 Major Foundry Clusters in India (x/y) Foundry Cluster: Rajkot Gujarat Foundry Overview Share of Casting Application There are about f foundry units at Rajkot which mainly cater to the local diesel engine industry Geographical spread of the cluster includes Aji Segment 1 e% Vasahat, Gondal Road and Bhavanagar Road areas Segment 2 Majority of the foundry units at Rajkot produces grey Rajkot Segment 3 d% iron castings for the domestic market and ~g% of Segment 4 them exports castings such as electric motor castings c% Segment 5 Around h% of the units use conventional cupola as the predominant melting furnace while a local design called 'Rajkot cupola is also popular b% a% Source: 5

6 Drivers & Challenges Summary Drivers Increasing demand from automobile sector Strong economic growth Supportive government participation Challenges Market constraints Rising input costs Low capacity utilisation Low cost of labour Improving technology and modernization 6

7 Public: Domestic Company Company (1/3) Company Information Offices and Centres India Corporate Address Tel No. Fax No. Website Year of Incorporation Ticker Symbol Stock Exchange Head Office Productsand Services Category Products/Services Category 1 Product 1, Product 2, Product 3 Category 2 Product 1, Product 2, Product 3 Category 3 Product 1, Product 2, Product 3 Category 4 Product 1, Product 2, Product 3 D Key People Name Designation A B C Source: Note: The list of products and services is not exhaustive 7

8 Public: Domestic Company Company (2/3) Financial i lsnapshot Key Ratios INR mn Total Income Financial Summary 2009 Net Profit/Loss INR mn The company incurred a net profit/net loss of INR X mn in FY 20XX, as compared to net profit/net loss of INR Y mn in FY 20YY The company reported total Income of INR XX mn in FY 20XX, registering an increase/decrease of X per cent over FY 20YY The company earned an operating margin of X.X per cent in FY 20XX an increase/decrease of X.X percentage points over FY 20YY The company reported debt to equity ratio of X.XX in FY 20XX, an increase/decrease of X.X per cent over FY 20YY Key Financial Performance Indicators Indicators Market Capitalization (INR mn) Total Enterprise Value (INR mn) EPS (INR) PE Ratio (Absolute) Source: Value (dd/mm/yyyy) 0 Particulars 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 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 y o y change ( ) Improved Decline 8

9 Public: Domestic Company Company (3/3) Key Business Segments Key Geographic Segments Segment 1 Segment 2 Country1 Country 2 Country 3 0% 0% Key Recent Developments Description Overview Product Line Expansion Plans News Company is a vertically integrated foundry, performing various machining, surface treatment, and heat treating operations in house It specializes in the manufacture of ductile iron and gray iron casting in the weight range of a grams to a maximum of b kgs It produces ductile and gray iron castings weighing less than a pound to over c tons and is an ISO 9001:2000 and ISO/TS certified company It has acquired a new grinding/fettling center from country Source: 9

10 Thank you for the attention The Foundry Market India report is part of Research on India s Manufacturing Series. For more detailed information or customized research requirements please contact: Gaurav Kumar Phone: E Mail: gaurav.kumar@netscribes.com Research on India is a product of Netscribes (India) Pvt. Ltd. Research on India is dedicated to disseminating information and providing quick insights on hot industries in India and other emerging markets. Track our new releases and major updates in these industries on About Netscribes Netscribes is a knowledge consulting g and solutions firm with clientele across the globe. The company s expertise spans areas of investment & business research, business & corporate intelligence, content management services, and knowledge software services. At its core lies a true value proposition that draws upon a vast knowledge base. Netscribes is a one stop shop designed to fulfil clients profitability and growth objectives. Disclaimer: This report is published for general information only. Although high standards have been used the preparation, Research on India, Netscribes (India) Pvt. Ltd. or Netscribes is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes (India) Pvt. Ltd. and prior permission is required for guidelines on reproduction. 10