Monthly Report June 2016

Transcription

1 Monthly Report June 216

2 Summary growth trends: June 216 Overall, June registered a stronger growth of ~9.% for the Indian industry compared to May and April that showed growth of 7.3% and 5.1% respectively Growth was high across all the regions with South witnessing the highest growth of ~9.3% ; West and North saw healthy growth of ~.% and ~.5% respectively, while East grew at ~7.7% Inflation seemed to be in the range of ~1% year-on-year similar to May and April; West saw above average price increments as indicated by an inflation of ~2.5% Engineering products and services, 2-wheelers emerged as winners in June posting a growth of over 1%; Building materials and Auto components registered modest growth of ~7.5%, while Commercial vehicles (5.6%) and Passenger vehicles (2.%) witnessed relatively weak growth 1. Not all respondents filled in regional growth numbers. Average of regional growths therefore, may not coincide with national average. The growth numbers reported are on an year-on-year basis. Inflation reported above is the value over volume growth based on the survey results. Growth numbers reported are on year-on-year basis Source: CII BCG Growth Index Survey; Industry association data on automotive sales 1

3 Copyright 21 by The Boston Consulting Group, Inc. All rights reserved. Survey results: June 216 performance YoY growth % Summary all respondents Regional growth All respondents 1 5.1% 3.1% 7.3% 6.% 9.%.% Apr 16 May 16 Jun 16 Jul 16 North:.5% (7.3%) Value Volume Peer growth comparison Industry growth comparison 2 wheelers 1 Engg prod. & serv. 1 Auto comp CV Other indus. 6 prod. & serv. PV Build. mater West:.% (6.3%) South: 9.3% (.1%) East: 7.1% (6.%) Region xx: Value xx% (yy%) Volume 1. Not all respondents filled in regional growth numbers. Average of regional growths therefore, may not coincide with national average. The growth numbers reported are on an year-on-year basis Note: Building materials (BM) industry refers to cement, cementitious products, paints, tiles, roofing, scaffolding. Industry average is displayed only when there are 3+ responses per industry. Other industries where responses were received include: consumer durables, textiles and apparels, chemicals, food products, Consulting services, Financial services. Regional averages may not fully align with national average because of different regional exposures of respondent industries. All averages are 'simple averages' (i.e. not weighted by size of company). CV Commercial vehicles, PV Passenger vehicles, Auto Comp Auto Components, Engg prod & services Engineering products and services Source: CII BCG Growth Index Survey; Industry association data on automotive sales 2

4 Copyright 21 by The Boston Consulting Group, Inc. All rights reserved. Building materials showed a strong growth in North and East Peer growth comparison Regional growth All respondents Building materials grew strongly at ~7.5% after two months of sluggish growth (< 2.5%) Prices increased for most categories (Cement prices were up %-5% y-o-y) North: 9.2% (.7%) West: 6.5% (6.5%) East:.5% (.5%) Delay in monsoon drove cement prices up by 1% in North West and Central India faced slower construction activities due to water shortage caused by 37% lower than normal monsoon Higher construction activities in the East post recent elections South: 5.% (3.3%) Region xx: Value xx% (yy%) Volume 1. Not all respondents filled in regional growth numbers. Average of regional growths therefore, may not coincide with national average. The growth numbers reported are on an year-on-year basis. Building materials include cement, cementitious products, paints, tiles, roofing, scaffolding, and glass. Source: CII BCG Growth Index Survey 3

5 Copyright 21 by The Boston Consulting Group, Inc. All rights reserved. Automotive industry continued to grow on the back of a good monsoon and recent 7th pay commission Passenger vehicle (PV) Commercial vehicle (CV) 2-wheelers PV showed weak growth of 2.6% Maruti Suzuki witnessed a y-o-y de-growth of ~1% Renault and Ford emerged as winners posting growth >1% Higher growth expected in July on back of monsoon discounts and recent pay revisions CV showed modest growth of 5.7% Growth drivers - Govt's push towards clearing long term road projects and increasing demand for heavy truck transportation Short term concerns - Increasing diesel prices and truck rentals 2-wheelers witnessed strong growth of ~% Yamaha and Royal Enfield posted growth upwards of 3% Govt's pay revision and good monsoon expected to drive high growth 1. Not all respondents filled in regional growth numbers. Average of regional growths therefore, may not coincide with national average. The growth numbers reported are on an year-on-year basis Source: CII BCG Growth Index Survey, Industry association data on automotive sales

6 Copyright 21 by The Boston Consulting Group, Inc. All rights reserved. Engineering products witnessed a high growth across all the regions Peer growth comparison Engineering products and services grew ~% in June 216 Heavy engineering and electrical segment get boost from capacity expansion in power sector and infrastructure industrial corridors, airports and road construction Steel production to remain low until August - govt. to review minimum import price 1% FDI (automatic route) expected to intensify competition Regional growth All respondents 1 North:.5% (11.3%) West:.5% (11.3%) South:.5% (11.3%) East: 11.3% (1%) Region xx: Value xx% (yy%) Volume 1. Not all respondents filled in regional growth numbers. Average of regional growths therefore, may not coincide with national average. The growth numbers reported are on an year-on-year basis. MHE Material handling equipments Source: CII BCG Growth Index Survey 5

7 Copyright 21 by The Boston Consulting Group, Inc. All rights reserved. MHE riding high on e-commerce, retail boom; South witnesses highest growth (2/2) Peer growth comparison Regional growth All respondents More than half of the surveyed companies reported growth of over 15% Rising e-commerce and retail provide major boost to MHE sector in South and West Growth in South driven by government's push to expand ports, harbours and better warehousing More than average monsoon to drive MHE demand in agri-warehousing, cold storage, and automotive sector North: 1.% (5.%) West: 1.5% (6.5%) South:.5% (13.5%) East:.5% (6.5%) Region xx: Value xx% (yy%) Volume 1. Not all respondents filled in regional growth numbers. Average of regional growths therefore, may not coincide with national average. The growth numbers reported are on an year-on-year basis. MHE Material handling equipments Source: CII BCG Growth Index Survey 6

8 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Overall economic indicators: June 216 review Growth Indices Growth Indices Commercial vehicle sales Economy statistics India GDP growth est. (%) 1 China GDP growth est. (%) 1 Latest month Previous month Current account Exports growth* (%) 3 Oil imports growth* (%) 3 Latest month (.) (3.) Previous month (6.7) (2.) ' % % Inflation WPI (%) Non-oil imports growth* (%) 3 (7.1) (22.) BSE Sensex 2 26,999 25,66 Trade deficit (US$ Bn) 3 (6.3) (.) Select industry metrics Capital account Passenger vehicle sales IIP (%) 3 Energy req growth 3 (%) PV Auto vol growth 2 (%) CV Auto vol growth 2 (%) Cement production (Mn Tn) (3.1) NRI deposits (US$ Bn) 6 FII flows (US$ Mn) 5 FDI flows (US$ Mn) Forex reserves (US$ Bn) 5 Currency competitiveness ' % -% Steel production (Mn Tn) *Not comparable as negative percentage in prior month 1. Average of GDP estimates for FY15-16 for China and India made by leading international financial institutions in Apr & Feb 2. As of Jun & May 3. As of May and Apr. As of end May and Apr 5. For Jun and May, Includes only equity flows. 6. Total outstanding values as of May and Apr 7. As in Jun and May Note: PV and CV refer to passenger and commercial vehicles resp. Source: RBI, Thomson One, Ministry of Finance monthly Report, Capitaline, EIS, BCG analysis, Press Search. 7

9 Good monsoon to provide further boost to Indian businesses Monsoon 216 forecast Overall, 6-7% higher than average monsoon expected (June Sept) Last year, 15% lower than average monsoon was received ~2% higher than last year Good monsoon to positively affect Automotive, Building materials, Warehousing, MHE, consumer durables, and FMCG sectors June statistics Arrived a week late on June 7 The cumulative monsoon in June (until June 21) was 21% less than normal East and North-east: 29% below normal Central India: 37% below normal North India: % below normal Southern peninsula: 13% above normal Forecast for July Higher than normal monsoon expected in July across India; 35% more than normal precipitation in the first week of July Central and North (MP, UT, HP, Delhi, East Rajasthan) India to receive higher than normal precipitation in the 2nd and 3rd week flood conditions and disruption due to river swelling Source: Indian Meteorological Department. MHE Material Handling Equipments

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