Build a business plan to enter Indian market which is a hub for manufacturing of wind components

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Strategic guidance to enter Indian wind
market
Build a business plan to enter India market which is a hub for manufacturing
of wind components
The Challenge
The client is a European manufacturer of components for wind turbines with over three decades of
experience. The client is a TIER 1 supplier to leading OEMs globally. The client has manufacturing
facility in the US and in EU and contract manufacturing in China. As renewable energy installations
boom in Asia, Client wanted to enter the Indian market.
India being a growing market for wind energy, offered significant
opportunities for the client’s business, who wished to enter the
market by setting up a local manufacturing facility.
However, the market has had many misses – the volume of the
market has been lumpy, the tariffs have declined, regulatory
regimes has not been stable, and some of the customers in Indian
market are known to delay payments.
The client reached out to MEC Intelligence to build a business plan for investing in the Indian wind
market. The focus was to assess sensitivity to cash flow and identify levers to ensure profitability. In
addition, the client wanted to understand how he can do business in India and the kind of organization
structure needed.
Our Approach
MEC did a workshop to understand the client assumptions and level of commitment of senior
management in investing in India. In the workshop, MEC provided client with financial performance
and business model of Indian supply chain to create a quick framework for discussions.
MEC realized that one of the key reasons for shifting to India to avoid costs in current manufacturing
set up and tap the India growth story. However, the costs escalations were still 3 years away. MEC
shared insights on inflation to support an informed discussion on objective. It was realized that India
should be leveraged where it is best fit set-up for the business and cash flow sensitivity to execution
will be essential in realizing the profits.
The study was segmented into two parts:
What is the best supply model to serve Indian and EU customers?
- What is the capacity to be realistically targeted in EU and in India?
- Whether manufacturing in India is an attractive business case vs import per product? How
much would the export cost?
- How does this change in year 5 and year 10?
- Whether supply chain and logistics are suitable for the attractive products?
- What are issues working with stakeholders in India? How should they be managed?
- What partnerships are needed? Which are the customers to follow?
India market
entry strategy for
European Wind
Energy OEM

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- What are the risks to cash flow due to delays, and government miss?
How to ensure pay back in India?
- Should one build or buy a factory? What is the cash requirement?
- Can contract manufacturing be explored to lower the investment risk?
- Does regulatory regime prefer manufacturing, where should the manufacturing plant be
located based on regulations, customers location, incentives?
- Where should the talent be sourced from?
- What are the regulatory incentives that need to be managed?
- What is the marketing, HR, tech transfer expenses?
- What are the KPI and organization structure?
The Impact
A full KPI map was prepared with detailed cash flow analysis. All risks were mapped, and mitigation
mechanisms were suggested.
Based on our recommendations and interactions with the board, the client is currently in process of
establishing itself in India. The fact-based analysis conducted by MEC Intelligence helped the client
time its entry into the Indian wind market at the most opportune moment.
About MEC Intelligence
MEC Intelligence is a market advisory and consulting firm with vast experience in wind energy sector.
In power sector services, we have worked with leading utilities, energy retailers, industrial companies,
turbine OEMs and private equity firms on projects like strategy support, opportunity scanning in
regional markets, business model assessment. MEC Intelligence has conducted an analysis of ~15
countries on nearly 10 attributes to determine the renewables’ impact on the power mix.
To know more, please visit www.mecintelligence.com
For more information/ feedback:
Write to us at info@mecintelligence.com or contact us at +91-124-480-2700
www.mecintelligence.com
INDIA
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Sector 54, Golf Course road
Gurgaon, Haryana
DENMARK
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Copenhagen, Denmark
www.mecintelligence.com
DENMARK
Nordre Fasanvej 113, 2
2000 Frederiksberg
Copenhagen, Denmark
T: +45-3543-3277
INDIA
510, Suncity Business Tower
Sector 54, Golf Course road
Gurgaon, Haryana
T: +91-124-480-2700