Market Research Report : Foundry Market in India 2012


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The report begins with an introduction to foundries and their process flow. The foundry process flow broadly comprises of three stages including melting, casting and finishing. The various types of casting processes used in the foundry industry are also provided.

The report begins with an introduction to foundries and their process flow. The foundry process flow broadly comprises of three stages including melting, casting and finishing. The various types of casting processes used in the foundry industry are also provided.

The market overview section begins with an insight into the global foundry market, including the top ten casting producers and their average production per plant. India was the fastest growing top-ten nation in 2009, increasing its casting tonnage by 9% over 2008. Change in the regional production of the global foundry market has also been added. This is followed by an overview of the Indian foundry market, growth of its casting production and segmentation of castings. Foundry market has been growing consistently in India, with grey iron castings accounting for the biggest share of total castings produced. An overview of the foundry units in India along with their segmentation is also included. Foundry units are mostly concentrated in the small units sector. Sector wise consumption of castings shows the various sectors where castings are largely consumed. Additionally, an analysis of Porter’s Five Forces provides an insight into the competitive intensity and attractiveness of the market.

This is followed by a section on foundry clusters, which includes a brief overview of foundry clusters and the Foundry Cluster Development Association, along with their distribution across India. A detailed profile including an overview and share of casting application is also provided for five major clusters, including Belgaum, Batala and Jalandhar, Coimbatore, Kolhapur and Rajkot.

Exports and imports of this sector have been highlighted, which throws light on the casting products that are traded internationally. This section includes the growth in their total export-import value and their country-wise segmentation.

An analysis of the drivers and challenges explains the factors leading to the growth of the market including increasing demand from automobile sector, strong economic growth, supportive government participation, low cost of labour and improving technology and modernization. Strong opportunity exists in the market as increasing demand for castings will drive the production of such products. This coupled with the fact that the Indian economy is growing strongly will lead to a developing market. Additionally, improving production technology and government support will help to stimulate growth in this market. The key challenges identified are market constraints, rising input costs and low capacity utilization. Restriction to local markets and infr

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Market Research Report : Foundry Market in India 2012

  1. 1. Insert Cover Image using Slide Master View Do not distortFoundry Market –Foundry Market IndiaJanuary 2012
  2. 2. Executive Summary  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 Market  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 – Increasing demand from automobile sector – Market constraints Drivers &  – Strong economic growth – Rising input costs Challenges – Supportive government participation – Low capacity utilisation – Low cost of labour – Improving technology and modernization p g gy  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 Future Outlook market by 2020  Vision Plan 2020 Interventions– In order to realise the Vision Plan 2020 various interventions are required Vision Plan 2020 Interventions In order to realise the Vision Plan 2020, various interventions are required  which aims to benefit the entire value chain and ensure balanced growth of the foundry sector  Major Players Co pet t o Competition Player 1 Player 2 Player 3 Player 4 Player 5 Player 6 FOUNDRY MARKET IN INDIA 2012.PPT 2
  3. 3. •Introduction•Market Overview M k O i•Foundry Clusters•Export‐Import•Drivers & Challenges Dri ers & Challenges•Competition•Future Outlook•Strategic Recommendations•Strategic Recommendations FOUNDRY MARKET IN INDIA 2012.PPT 3
  4. 4. Foundry market is growing consistently in India and it is the  second largest producer of castings in the world Indian Foundry Market – Overview Production of Castings – Growth • In 200‐, India was the world’s second largest  producer of castings and also one of the top 10 in  mn MT terms of average production per plant D% • 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 Indian foundry industry employs around b mn  persons directly and another c mn indirectly 0 • Production of castings in India took a dip in 200‐ due  2006‐10 2011‐2015e to the global crisis, but has recovered with strong  Production of Castings – Segmentation growth in 20‐‐ growth in 20 • Growing concern regarding the quality and quantity  Segment 1 Segment 2 of castings will drive the establishment of larger  Segment 3 Segment 4 i%j% casting facilities in India over the next few years Segment 5 G%h% K% • With growing demand from the automobile and  F% engineering sectors coupled with India’s rapidly  growing economy, the foundry market is expected to  x occupy the biggest share  E% of total castings produced grow strongly in the near futureSource: FOUNDRY MARKET IN INDIA 2012.PPT 4
  5. 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 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 a% • Majority of the foundry units at Rajkot produces grey Majority of the foundry units at Rajkot produces grey  Segment 3 Segment 3 Rajkot d% iron castings for the domestic market and ~g% of  Segment 4 c% them exports castings such as electric motor castings Segment 5 b% • Around h% of the units use conventional cupola as  the predominant melting furnace while a local design  called Rajkot cupola‘ is also popularSource: FOUNDRY MARKET IN INDIA 2012.PPT 5
  6. 6. Drivers & Challenges – Summary  Drivers Challenges Increasing demand from automobile  Increasing demand from automobile sector Market constraints Strong economic growth Rising input costs Supportive government participation Low capacity utilisation Low cost of labour Improving technology and  modernization FOUNDRY MARKET IN INDIA 2012.PPT 6
  7. 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 Products and Services Products and Services Category Products/Services Key People Category 1 Product 1, Product 2, Product 3 Name N Designation D i ti Category 2 Product 1, Product 2, Product 3 A B Category 3 Product 1, Product 2, Product 3 C Category 4 Product 1, Product 2, Product 3 DSource: Note: The list of products and services is not exhaustive FOUNDRY MARKET IN INDIA 2012.PPT 7
  8. 8. Public: Domestic Company – Company (2/3) Financial Snapshot i i lS h Key Ratios K i Total Income Net Profit/Loss y‐o‐y change  Particulars  2011 2010 2009 2008 (2011‐10) INR mn INR mn Profitability Ratios Operating Margin Net Margin Profit Before Tax Margin Return on Equity Return on Capital Employed 0 0 Return on Working Capital 2008 2009 2010 2011 Return on Assets Financial Summary  Return on Fixed Assets Cost Ratios • The company incurred a net profit/net loss of INR X mn in FY 20XX,  Operating costs (% of Sales) as compared to net profit/net loss of INR Y mn in FY 20YY Administration costs (% of  • The company reported total Income of  INR XX mn in FY 20XX,  Sales) registering an increase/decrease of X per cent over FY 20YY registering an increase/decrease of X per cent over FY 20YY Interest costs (% of Sales) Interest costs (% of Sales) Liquidity Ratios • The company earned an operating margin of X.X per cent in FY 20XX  Current Ratio an increase/decrease of X.X percentage points over FY 20YY Cash Ratio • The company reported debt to equity ratio of X.XX in FY 20XX, an  Leverage Ratios increase/decrease of X.X per cent over FY 20YY Debt to Equity Ratio Debt to Capital Ratio b i l i Key Financial Performance Indicators Interest Coverage Ratio Indicators Value (dd/mm/yyyy) Efficiency Ratios Market Capitalization (INR mn) Fixed Asset Turnover Total Enterprise Value (INR mn) Asset Turnover Current Asset Turnover EPS (INR) EPS (INR) Working Capital Turnover PE Ratio (Absolute) Capital Employed TurnoverSource: Improved Decline FOUNDRY MARKET IN INDIA 2012.PPT 8
  9. 9. Public: Domestic Company – Company (3/3) Key Business Segments Key Geographic Segments Segment 1 Segment 2 Country1 Country 2 Country 3 0% 0% 2008 2009 2010 2011 2008 2009 2010 2011 Key Recent Developments Description  News • Company is a vertically integrated foundry, performing various machining, surface treatment, and heat  Overview 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 i fbk Product Line • 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 16949 certified company Expansion Plans • It has acquired a new grinding/fettling center from countrySource: FOUNDRY MARKET IN INDIA 2012.PPT 9
  10. 10. Thank you for the attentionThe Foundry Market ‐ India report is part of Research on India’s Manufacturing Series. For more detailed information or customized research requirements please contact:Gaurav KumarPhone: +91 33 4064 6214E‐Mail: gaurav.kumar@netscribes.comResearch on India is a product of Netscribes (India) Pvt. Ltd. Research on India is dedicated to disseminating information and providing quick Research on India is a product of Netscribes (India) Pvt Ltd Research on India is dedicated to disseminating information and providing quickinsights on “hot” industries in India and other emerging markets. Track our new releases and major updates in these industries onAbout NetscribesNetscribes is a knowledge‐consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of investment &  g g f g p y p p fbusiness 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, Disclaimer: This report is published for general information only Although high standards have been used the preparation Research on IndiaNetscribes (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. FOUNDRY MARKET IN INDIA 2012.PPT 10