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  • www.ibef.org Indian Economy Opportunities Unlimited Indian Economy Opportunities Unlimited
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  • www.ibef.org 2 India: Fastest Growing Free Market Democracy GDP GrowthForexFII FlowFDIPer CapitaInflation 19904.9 percent< USD 1 billionUSD 1 million (1993)USD 97 millionUSD 3909 percent 2008*9.0 percentUSD 310.7 billion as on June 13, 2008 USD 16.1 billion in 200708 USD 25 billion in 200708 USD 74011.91 percent as on July 17, 2008 Sources: Times of India,, RBI, RBI, DIPP, Indian Budget, Rediff, The Economic TimesTimes of IndiaRBI DIPPIndian BudgetRediffThe Economic Times * Annualized data used to show comparison with 1990
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  • www.ibef.org 3 India: Among the Top 15 Countries in terms of GDP at constant prices The Indian economy has witnessed unprecedented growth. Booming services and industry sectors are providing the required impetus to economic growth Contribution of Services - increased from 48 percent to 53 percent Growth in sectors at Constant Prices (2007 08): Industry: 10.8% Services: 8.5% Agriculture: 4.5% Growth in sectors at Constant Prices (2007 08): Industry: 10.8% Services: 8.5% Agriculture: 4.5% Source: MOSPI Statistics, RBIMOSPI StatisticsRBI * RE - Revised Estimates Fastest GDP growth of 9.4 percent in 200607, since last 18 years (at constant prices) Indias GDP has witnessed high growth and was the second fastest growing GDP after China in 2007-08 The sound performance of each industry segment is leading to the overall robust performance of the Indian economy 27 percent Increase
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  • www.ibef.org 4 India: Robust Economic Platform Steadily increasing Forex reserves offer adequate security against any possible currency crisis or monetary instability Increased confidence of investors in Indian companies has led to a surge in cross border borrowing by corporate houses In 2007-08, Forex reserves witnessed a growth of approximately 56 percent over 2006-07. Indias Forex reserves are in excess of external debt the decreasing external debt to GDP ratio indicates that India has a sound economic platform Source: RBI StatisticsRBI Statistics
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  • www.ibef.org 5 India: Surging Exports Petroleum products are the major contributors towards Indias growing imports Quality and cost advantage are the two important parameters leveraged by the Indian producers to increasingly market products and services Services sector has been a major contributor to increased exports from India Product imports by India mainly include petroleum products and minerals Acceptance of Indian products along with the cost advantage has provided an edge to Indian companies Source: Ministry of Finance (May 2008)Ministry of Finance (May 2008) Exports in April 2008 amounted to USD 14.4 Billion increasing by 31.5 percent from April 2007 Imports in April 2008 amounted to USD 24.2 Billion increasing by 36.6 percent from April 2007
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  • www.ibef.org 6 140 percent Increase India: Attractive Investment Destination India is ranked second in AT Kearneys FDI confidence index (2007) FDI inflow for the period 2007-08 witnessed a growth of 56 percent over the last year With improved performance on PE ratio and ROE, Indian markets have attracted large investments Source: DIPP (October Report), SEBIDIPP (October Report) SEBI Electronic equipment, manufacturing and telecom have witnessed significant FDI inflow Large FII activity in India has led to an upsurge in the Sensex * FII growth momentum was restricted because of Sub Prime Crisis in 2007-08 FDI for April 2008 amounted to USD 3749 Million 56 percent Increase
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  • www.ibef.org 7 India: Vibrant Capital Market India is among the major destinations across the globe for inflow of US Dollar Sensex has risen 20 times in the period 1990-2007 Sensex The Bombay Stock Exchange index has risen 20 times from 1990s to reach 20,000 mark in November 2007. FIIs have infused large investments into the Indian stock market Encouraging industry performance Increased local investors confidence Emergence of industry and confidence of local investors along with the FIIs has led to upsurge of the Sensex
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  • www.ibef.org 8 India: Vibrant Economy Driving M&A Activities Growth Drivers: Globalisation and increased competition Concentration of companies to achieve economies of scale Cash Reserves with corporates Private equity deal value increased to USD 19 billion In 2007, there were a total of 676 M&A deals and 405 private equity deals Total M&A deal value was close to USD 51 billion Trends: Cross-border deals are growing faster than domestic deals Private Equity (PE) houses have funded projects as well as made a few acquisitions in India Source: Deal Tracker Grant Thornton, Economic Times, IBEF, RBIDeal Tracker Grant ThorntonEconomic TimesIBEFRBI In 2007, the total value of M&A and PE deals was USD 70 billion First two months of 2008 have already seen 92 M&A valued at approximately USD 6 Billion
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  • www.ibef.org 9 Major M&A Deals Undertaken Abroad by India Inc. USD 12.1 billion Tata Steel buys Corus Plc USD 6 billion Hindalco acquired Novelis Inc. USD 2.3 billion Tata buys Jaguar and Land Rover USD 1.6 billion Suzlon Energy Ltd. acquires REpower USD 1.58 billion Essar Steel acquired Algoma Steel
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  • www.ibef.org 10 Major M&A and Investments Announcements in India USD 11 billion Vodafone buys Hutch USD 1.7 billion Plans to spend on its development operations in India over the next four years USD 2 billion Plans to establish three manufacturing plants to produce photo-voltaic units USD 12 billion POSCO to invest in building steel manufacturing plants and facilities in India by 2016
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  • www.ibef.org 11 USD 0.98 billion Aditya Birla Group increased its stake in Idea Cellular by acquiring 48.14 percent stake USD 1 billion Plans investment in private equity, real estate, and private wealth management Mylan Laboratories acquired a majority stake in Matrix Laboratories USD 0.74 billion Major M&A and Investments Announcements in India USD 1 billion Plans investment in private equity in Indian markets
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  • www.ibef.org 12 Major M&A and Investments Announcements in India USD 0.185 billion Plans to invest in six private equity funds in Indian market Plans expansion of network in India USD 45 billion Plans expansion of cement capacity in India Over USD 1 billion Source: The Economic TimesThe Economic Times
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  • www.ibef.org 13 USD 0.5 billion Plans to invest in the Uganda market Indian Companies Fuelling Future Expansions USD 0.2 billion Plans to provide services in the Sri Lanka market Plans to invest in its global expansion efforts Over USD 2 billion RIL is planning to invest in its recently acquired polyester manufacturing facility in North Carolina USD 0.215 billion Source: International Business Times, The Financial Express, IBEF, SifyBroadbandInternational Business TimesThe Financial ExpressIBEFSifyBroadband
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  • www.ibef.org 14 India: Pacing Ahead to Emerge as a Major Economy in the World 2008 Global Retail Development Index (GRDI) AT Kearney has placed India as the most preferable destination for Services sector (2007) Services sector continues to attract interest from major global players and large investments are being pumped into it India is expected to outperform its rivals in the BRIC, in terms of GDP growth rate, from 2015 onwards Source: AT Kearney, BRIC ReportAT KearneyBRIC Report India ranks second in the AT Kearney Global Retail Development Index (2008)
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  • www.ibef.org 15 BRIC Report, Goldman Sachs I have never seen India so dynamic, vibrant and full of business opportunities. - Dan Scheinman, Cisco System Inc. as told to Business Week, August 2005 We came to India for the costs, stayed for the quality and are now investing for innovation. John Redwood Economic Competitiveness Policy Group, UK India is now truly a land of opportunity. Jack Welch General Electric India is a developed country as far as intellectual capital is concerned. Peter Loescher President and Chief Executive Siemens By 2032, India will be among the three largest economies in the world. Why India? Quote Unquote Travyn Rhall, ACNielsen The Indian market has two core advantages - an increasing presence of multinationals and an upswing in the IT exports. Craig Barrett Intel Corporation India has evolved into one of the world's leading technology centers. Mr Paul de Voijs Managing Director Volvo Car India India is a very exciting market and the luxury car segment is growing exponentially here.
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  • www.ibef.org 16 DISCLAIMER This presentation has been prepared jointly by the India Brand Equity Foundation (IBEF) and Evalueserve.com Pvt. Ltd., EVALUESERVE (Authors). All rights reserved. All copyright in this presentation and related works is owned by IBEF and the Authors. The same may not be reproduced, wholly or in part in any material form (including photocopying or storing it in any medium by electronic means and whether or not transiently or incidentally to some other use of this presentation), modified or in any manner communicated to any third party except with the written approval of IBEF. This presentation is for information purposes only. While due care has been taken during the compilation of this presentation to ensure that the information is accurate to the best of the Authors and IBEFs knowledge and belief, the content is not to be construed in any manner whatsoever as a substitute for pro