Seventh-largest R&D investor

In 2012, India had the worlds seventh-largest annual R&D investment, accounting for 2.8 per cent of global R&D expenditure; this is expected to increase to USD45.2 million by 2013, accounting for 3.0 per cent of global R&D spending

Pharma sector driving R&D growth

Indias pharmaceutical industry, which accounts for about 1.4 per cent of the global pharmaceutical industry in value terms and 10 per cent in volume terms, is expected to remain a major R&D growth driver

Rapidly growing overseas investment

Cumulative overseas direct investments by India has expanded at a CAGR of 47.4 per cent to USD146 billion during FY13 from USD21 billion in FY06

Worlds sixth most innovative country

India stood sixth in terms of the most "innovative" country in General Electric's Annual Global Innovation Barometer in January 2013

Source: Planning Commission, Aranca Research Note: R&D - Research and Development

2011

Robust demand demand Growing

Rising income and evolving lifestyles have led to higher demand for aspirational products Indian companies investments in R&D is not surprising given the importance of innovation to sustain competitive edge

Attractive opportunities
Vast opportunities in IT, pharmaceuticals, automobiles, biotechnology and agriculture India is the largest exporter of IT products and has the third largest pharma sector with a fast growing contract research segment

2013E
R&D spending: USD45.2 billion

R&D spending: USD38 billion

Advantage India
High ratings

Establishment of CoEs in various areas; NMITLI initiative on PPP basis Increased investments by private players; setting up of R&D centers During FY0713, IPR applications increased at a CAGR of 11.8 per cent from 137,900 to 269,500

The engineering sector is delicensed; PPP forcent promoting exchange of 100 per FDI is allowed in the scientific knowledge and R&D sector Strengthening educational Due to policy support, there was infrastructure cumulative FDIto ofthe USD14.0 billion Amendments Patents Actinto the sector over April 2000 February (1970) to make it TRIPS-compliant 2012, making up 8.6 cent of total Setting up of NIC inper 2010 FDI into the country in that period Adoption of Science, Technology and Innovation Policy 2013

Policy support

Source: 2012 R&D spending estimate by Battelle, Automotive Research Association of India, Aranca Research Notes: IPR - Intellectual Property Rights, CoE - Center of Excellence, PPP - Public Private Partnership, TRIPS - Trade Related Aspects of Intellectual Property Rights, NMITLI - New Millennium Indian Technology Leadership Initiative, E - Estimate, NIC - National Innovation Council

Early 1990s to 2005 Liberalisation and Transition Era 1970 to early 1990s Indigenisation Stage

2005 onwards Growth Era

Before 1970 Introductory Stage

Indian Patents and Designs Act (1911) Dependence on bulk imports Establishment of CSIR, DRDO, ICAR, ISRO and IITs

Patents Act (1970) Recognition of process patents only Restricted foreign ownership in Indian companies Focus on reverse engineering among pharmaceutical companies

TRIPS under WTO (1995) Amendments to the Patents Act (1970) to make it TRIPS compliant Reintroduction of product patents Reduction in tariff and non-tariff measures Easing FDI norms Shifting focus in pharma towards clinical research and new drug development

Augmentation of network of centrally-funded institutions and universities Increase in R&D and exports in sectors such as IT, pharma, electronics and automobiles Innovations in automobiles such as Nano, the worlds least expensive car Focus on discovery of new chemical entities by pharma companies Numerous innovations from rural India Setting up of National Innovation Council Adoption of Science, Technology and Innovation Policy 2013

Source: Korn/Ferry International, Asia-Pacific Research center, Stanford University, Aranca Research Notes: TRIPS - Trade Related Aspects of Intellectual Property Rights, WTO - World Trade Organisation

Patents

Copyright

Trademarks

Intellectual Property (IP) Plant Variety Protection Geographical

Indications

Layout Designs

Industrial Designs
Source: Department of Industrial Policy and Promotion, Aranca Research

In 2012, India was the seventh-largest country in terms of R&D investments, up from eighth largest in 2011 It is expected to retain this position in 2013, with R&D investments increasing to USD45.2 billion from USD38 billion in 2011

Forecasted Expenditure of Worlds Leading R&D Investors in 2013 (USD Billion)

United States China Japan Germany South Korea France India United Kingdom Russia Brazil 58 51 45 42 39 32 91 162 220 424

Source: Battelle, Aranca Research Notes: GERD - Gross Domestic Expenditure on R&D, R&D - Research and Development

Indias share of global R&D spending rose to 2.8 per cent in 2012 from 2.6 per cent in 2010 and is forecasted to reach 3.0 per cent by 2013 Indias R&D investment growth is likely to outpace overall GDP growth. During 201013, R&D spending (in terms of PPP) is expected to expand at a CAGR of 11.6 per cent to USD45.2 billion, while GDP (in terms of PPP) would increase at a CAGR of 7.8 per cent The Planning Commission of India expects to double the governments R&D spending from the current 0.9 per cent of GDP to 2 per cent by 2017

R&D Spending in India (USD Billion)

50 45 40 33 30 20 0.81% 10 0 2010 2011 R&D expenditure (PPP) 2012 0.80% 0.78% 0.75% 2013F AS a % of GDP -RHS 0.85% 0.85% 38 40 0.90% 0.87% 0.84% 0.90% 0.93%

Source: Battelle, Aranca Research Notes: CAGR - Compound Annual Growth Rate; PPP - Purchasing Power Parity, F - Forecast

Cumulative overseas direct investments increased to USD146 billion in FY13 from USD21 billion This has led to significant amount of technology transfer through industrial acquisitions

Cumulative Overseas Direct Investment (USD billion)

146

125

For instance, Tata Steels takeover of Corus brought with it more than 80 patents and 1,000 researchers
56 38 21

100

FY08

FY09

FY10

FY11

FY12

FY13

Source: Reserve Bank of India, Battelle, Aranca Research

During FY13, the total patent applications stood at 269.5 thousand Trademark applications accounted for the largest share (79 per cent) of total applications at 212,900

Break-up of Intellectual Property Rights (IPR) Applications (FY13)

Patent-LHS 18%

Patent and design applications accounted for 17.6 per cent (47,300 applications) and 3.4 per cent (9,200) share, respectively

3% Design -LHS

79%

Trade mark application -LHS

Source: Department of Industrial Policy and Promotion Aranca Research

During FY0713, intellectual property rights (IPR) applications increased at a CAGR of 11.8 per cent from 137,900 to 269,500 Trademark applications expanded at a CAGR of 12.8 per cent over FY0713 to 212,900 Patent and design applications rose at a CAGR of 8.6 per cent and 8.9 per cent, respectively, during the same period Growing IP application activity indicates increased in-house R&D and innovation in India

Intellectual Property (IP) applications (000)

250 200 150 150 100 100 50 0 FY07 FY08 FY09 FY10 FY11 FY12 FY13 Patent-LHS Trade mark application -LHS 50 0 Design -LHS Total IPR applications -RHS 300 250 200

Source: Department of Industrial Policy and Promotion Aranca Research

The number of MNC R&D centers in India has grown at a CAGR of 16.4 per cent to 871 Around 30 per cent of the top 1,000 global R&D spending organisations have centers in India Most of the centers are located in metro cities Bengaluru, Delhi, Mumbai, Chennai and Hyderabad. However, MNCs have begun spreading out to tier-2 cities after 2005 Indias robust talent pool of over 200,000 engineers has grown at an average rate of 9 per cent over the last five years; this has been supporting increased R&D activity
191

MNC R&D Centers in India

871

CAGR: 16.4%
517 297

780 699

Pre 2000

2002

2004

2006

2008

2011

Source: Zinnov Consulting, The Indian R&D Landscape, 2012 Notes: CAGR - Compound Annual Growth Rate, R&D - Research and Development,

Bengaluru (erstwhile Bengaluru) has 43 per cent of MNC R&D centers, followed by Mumbai and Pune at 19 per cent Until 2005, Tier-1 cities were the favourite destination for MNCs due to the availability of rich talent, favourable policies, and better quality of life However, post-2005, MNCs have started expanding to Tier2 cities, as they offered benefits such as higher catchment area, lower attrition, and cost arbitrage

MNC R&D centers Distribution in India (2012)

Others 4% Chennai 10%

NCR 11%

Bengaluru 43%

Hyderabad 13% Mumbai/ Pune 19%

Source: Zinnov Consulting, The Indian R&D Landscape, 2012 Notes: CAGR - Compound Annual Growth Rate, R&D - Research and Development

R&D outsourcing has increased at a CAGR of 33.5 per cent during 200311 to USD13.1 billion Companies across sectors (such as IT, consumer electronics, personal devices, medical electronics, telecom and automobiles) are now offshoring complete product responsibility India has become one of the most preferred location for engineering offshoring By 2020, USD42 billion worth of work related to R&D of product engineering is expected to be outsourced to India

R&D Outsourcing in India (USD Billion)

13.1

CAGR: 33.5%

1.3

2003

2011

Source: Financial Express, Value Notes, Aranca Research, Notes: R&D - Research and Development, IT - Information Technology; CAGR - Compound Annual Growth Rate

Organisation

Business description
Council of Scientific and Industrial Research (CSIR) CSIR is Indias largest R&D organisation, with 39 laboratories and 50 field stations. In FY12, CSIR had over 1,872 active patents in India, 813 in the US, 328 in the EU, 147 in Japan and 829 in other countries It is engaged in scientific industrial R&D for economic, environmental and societal benefits for the country Its research areas span across aerospace, biotechnology, chemicals, energy, foods, information dissemination, leather and metals, minerals and manufacturing etc. Defence Research and Development Organisation (DRDO) DRDO is engaged in design and development of weapon systems and equipment in accordance with the requirements of the military services In 2012, DRDO had a network of 50 labs and establishments to carry out research. It has over 5,000 scientists and about 25,000 other scientific, technical and supporting personnel Its research areas include aeronautics, armaments, combat vehicles, electronics, instrumentation engineering systems, missiles, materials, naval systems, advanced computing, simulation and life sciences Indian Council of Agricultural Research (ICAR) ICAR is one of the largest national agricultural organisations in the world. It consisted of 99 institutes and 53 agricultural universities across India in 2012 It is the apex body for coordinating, guiding and managing research and education in agriculture, including horticulture, fisheries and animal sciences in India

*This list is indicative

Source: Organisational websites, Aranca Research Notes: R&D - Research and Development

Organisation

Business description
India Space Research Organisation (ISRO) ISRO is engaged in development of space technology and its application to various national tasks The organisation has 19 centers across India to pursue R&D activities

Its research areas include communication satellites for television broadcast, telecommunications and meteorological applications, and remote sensing satellites for management of natural resources
Indian Council of Medical Research (ICMR) ICMR is the apex body in India for the formulation, coordination and promotion of biomedical research and one of the oldest medical research bodies in the world The council has a fleet of 21 institutes, six regional medical research centers and five units engaged in medical research The councils research priorities encompass the areas of communicable diseases, fertility control, maternal and child health, nutritional disorders, and non-communicable diseases such as cancer, cardio-vascular diseases, blindness and diabetes Centre for Development of Advanced Computing (C-DAC) C-DAC is a premier R&D organisation of the Department of Information Technology (DIT) It is engaged in research in the areas of supercomputers, applied electronics, technology, applications and health informatics. CDAC has filed 16 patent applications in FY11
*This list is indicative Source: Organisational websites, Aranca Research Notes: R&D - Research and Development

Organisation
Indian Institutes of Technology (IITs)

Business description

It is a group of autonomous engineering and technology oriented institutes of higher education In FY11, IITs filed the highest number of patent applications amongst all the institutes and universities in India. IIT Bombay filed 77 patent applications in 2011, an increase of 400 per cent from that in 2006 National Dairy Research Institute (NDRI) NDRI is engaged in research, teaching and extension activities in areas of dairy production, processing, management and human resource development Its research activities focus on improving dairy productivity, innovating milk processing technologies and disseminating information to the various stakeholders in dairy business to make dairying a self-sustaining business In 2012, R&D activities comprised 71 in-house and 46 externally funded research projects, including 20 NAIP projects in consortium mode with financial outlay of USD7.1 million Indian Institute of Science (IISc)

IISc is one of the earliest instances of PPP for a research institute in India
It is engaged in research in various departments of science such as biological, chemical, electrical, mathematical, physical and mechanical sciences In FY10, the institute filed the third highest number of patent applications amongst all the institutes and universities in India
*This list is indicative Source: Organisational websites, Aranca Research Notes: R&D - Research and Development

Organisation

Business description
The Energy and Resources Institute (TERI) TERI is engaged in developing solutions to global problems in fields of energy, environment and sustainable development The important research areas include biotechnology, earth science and climate change, technology development, social transformation, and modelling and economic analysis Institute of Life Sciences (ILS) ILS undertakes basic and translational research in frontier areas of life sciences The institutes research interests are in the areas of infectious disease biology, gene function and regulation, and translation research and technology development Indian Institute for Advanced Studies (IIAS) IIAS is a residential centre for advanced research in humanities, social sciences and natural sciences Its major research areas include social, political and economic philosophy; comparative studies in philosophy and religion; education, culture and arts; natural and life sciences; and national integration and nation building

*This list is indicative

Source: Organisational websites, Aranca Research Notes: R&D - Research and Development

Organisation
Hindustan Unilever Limited

Business description

HUL is credited with innovations in product areas such as structured bar soap, fairness cream, zero alcohol soap, poly-coated scouring bar for dishwashing, fortified salt, instant tea, critical components for a water purifying device, and value-added (nature care) tea Worldwide, HUL has over 20,000 registered patents and patent applications The company filed 57 patent applications and was one of the top Indian patentees in FY11 Tata Steel Limited Tata Steel undertakes research in areas such as raw materials and coke, iron and ferro alloys, steel making, coated products, materials characterisation and joining, materials modelling and product design, and refractory technology The company filed 42 patents in FY12, taking its IP portfolio (filed and granted patents and copyrights) from 32 in FY2000 to 493 Cipla Limited Ciplas R&D division focuses on new product development and new drug delivery systems across a range of therapies In FY12, the companys total R&D spending stood at USD59.2 million, a growth** of 13.6 per cent from a year ago In 2011, Cipla filed 260 patent applications across the globe of which 13 were filed in India
*This list is indicative Source: Organisational websites, Aranca Research Notes: R&D - Research and Development, Growth** - In terms of INR

Reaper Windrower Machine For easy and timely harvesting of soybean crop Prevents shattering of soybean pods due to non-availability of labourers for harvesting the crop in time

Hand Operated Water Lifting Pump For convenient water-lifting at a good discharge rate and low cost The pump was built in response to a dearth of available pumps that could be afforded by small farmers

Bamboo Lathe Machine For stripping off the outer covering of bamboo to develop a smooth surface for making interior decoration and utility items Reduces the time and labour required to do the job manually

Pedal Operated Washing Machine For washing clothes while exercising on a pedal machine An affordable and convenient way of washing clothes in rural India which experiences frequent power shortages

Source: Rediff Business, Aranca Research

INS Vikrant India Indigenous Aircraft Carrier (IAC) Total displacement of over 40,000 tonnes Being built by Cochin Shipyard Limited To be inducted by 2014-16

Agni-V missile Successfully test fired in April 2012 India joined an elite group of nations having ICBM technology Indigenously developed by DRDO To be inducted by 2014-15

Arihant Class Submarines

Tejas Second supersonic aircraft to be developed indigenously by Hindustan Aeronautics Limited (HAL) To be inducted by 2015 at a cost of USD103.1 million

With its launch in 2009, India joined an elite group of nations having nuclear-powered submarines Developed by HSL To be commissioned by 2012-13

Source: Times of India, Economic Times, The Hindu, Defence Now Notes: ICBM - Inter-Continental Ballistic Missile, DRDO - Defence Research & Development Organisation, HSL - Hindustan Shipyard Limited

Growing Demand

Policy support

Increasing Investments

Evolving consumer lifestyles

PPP in R&D

Establishment of CoEs, NMITLI initiative

Inviting Liberalisation and increasing competition Strengthening educational infrastructure

Resulting in Providing support to global projects from India

Proximity to future growth markets

Amendments to the Patents Act & Setting up of NIC

Increasing corporate R&D investments

Source: Battelle, Electronics for You, Organisational websites, Aranca Research Notes: PPP - Public Private Partnership, R&D - Research and Development, NMITLI - New Millennium Indian Technology Leadership Initiative, CoE - Centre of Excellence, NIC - National Innovation Council

Indias pharmaceutical market is highly fragmented, with 300 large and 18,000 mid-sized and small companies The countrys pharma industry accounts for about 1.4 per cent of the global pharma industry in value terms and 10 per cent in volume terms The healthcare sector in India is expected to reach USD100 billion by 2015 from the current USD65 billion This would help drive R&D growth in India; the average R&D expenditure by Indian pharma companies is close to 6 per cent of total revenues In FY12, total R&D spending by top six pharma companies was USD503.5 million

R&D spending by top six pharma giant in FY12 (USD million)

130 124 98 59 39 36 16

Dr. Reddy's Labs

Ranbaxy

Piramal Healthcare

Source: Aranca Research

Orchid Chemicals

Lupin

Wockhart

Cipla

PPP in R&D

Exchange of scientific knowledge between research centers, national laboratories, institutes of higher learning and the industry The Indian Government plans to involve the private sector in R&D mainly for sectors like vaccines, drugs and pharmaceuticals, super computing, solar energy and electronic hardware The government has shell out a USD1.1 billion public-private partnership fund to support research and development in India

Funded Institutions and Foreign Universities

Increasing the number of Indian Institutes of Technology (IITs) to 16, establishing 3 new Indian institute of Science Education and Research (IISER) and 30 central universities Foreign universities permitted to enter the higher education system in India by establishing their own campuses or joint ventures with existing universities

Tax Incentives

Government offers 200 per cent deduction for capital and revenue expenditure incurred by manufacturing companies with in-house R&D Income tax exemption of 125 per cent to 175 per cent on donations made to universities, colleges and other scientific associations
Source: Battelle, Electronics for You, Organisational websites, Aranca Research Notes: PPP - Public Private Partnership

Patents Act

Amendments to the Patents Act, 1970 to make it TRIPS compliant Increased incentives to domestic firms to conduct R&D Increased likelihood of technology transfer from developed nations

National Innovation Council (NIC)

In 2010, NIC was set up to implement strategies for inclusive innovation in India and prepare a roadmap for innovation over 2010-20 Tasks of NIC include creating a framework to encourage innovation by central and state governments, universities, R&D institutions and SMEs
Source: Battelle, Aranca Research Notes: SMEs - Small and Medium Enterprises

Introduction of STI Policy 2013

In January 2013, the government of India introduced the Science, Technology and Innovation (STI) policy 2013 at the centenary sessions of the Indian Science Congress held at Kolkata

Vision of STI Policy

The STI policy is aimed at helping India become one of the top five global scientific powers by 2020

Rising Involvement of The Private Sector

STI aims to boost innovation through research and development (R&D) led by the publicprivate partnership (PPP) mode thereby increase the investments on research and development (R&D) to 2 per cent of GDP by 2017 from current 1 per cent The policy seeks to increase the number of full-time R&D personnel by 66 per cent over 201317 and expand the number of publications from the current 3.5 per cent of global share to around 7 per cent by 2020
Source: Aranca Research

Increase in Human Resources

2013
Jan 13: DuPont is planning to Mar

2012
12: Aditya Birla Group launches R&D centre at Navi Mumbai, developed at a cost of about USD52 million

double their R&D activities in India

Jun 13: Huawei will be setting up

a new research and development (R&D) centre in Bengaluru with an investment of USD150 million

Apr 12: Maruti Suzuki announces

an investment of USD500 million to set up an R&D facility at Rohtak

Jun 25: Chinese equipment maker

Huawei will invest USD2 billion to set up global R&D center

Nov

23: General Electric will invest USD60 million to expand its R&D facility; its is expected to develop 30 new products by 2015

Source: India Electronic News, Moneycontrol, CNBC, Economic Times, Appliancemagazine.com, Business Standard, The Hindu, Company websites, Aranca Research Notes: R&D - Research and Development

2011
Apr 11: Hitachi to invest

2010
Jan 10: Huawei allocates Jun

2009
09: LG Electronics doubles its annual R&D investment outlay to USD83 million

USD400 million to set up R&D center in Bengaluru

May 11: ISRO announces

USD500 million investment for R&D center in Bengaluru

May

setting up of spacecraft R&D center on 530 acres land at Chitradurga

Oct

10: Bridgewater opens center of Excellence in Gurgaon for telecom software R&D

Oct 09: Tata DoCoMo sets

up R&D center for valueadded services (VAS) and mobile applications

Oct 09: Hyundai sets up

11: Saab AB and Mahindra Satyam open an R&D center in Hyderabad for conducting research in aerospace, defence and civil security

Aug 10: Alstom earmarks

USD39 million to establish R&D center for power products at the Infosys campus

R&D center at Hyderabad at an investment of USD25 million

Source: India Electronic News, Moneycontrol, CNBC, Economic Times, Appliancemagazine.com, Business Standard, The Hindu, Company websites, Aranca Research Notes: R&D - Research and Development

Centers of Excellence (CoEs)

The government has set

NMITLI
The programme identifies

Centrally Funded Institutes

The government proposes

Central and Foreign Universities

Government is expected to

up CoEs based on the PPP model for technology development and transfer, scientific research, human resource development and economic outreach
CoEs have been set up in

areas for development based on national consultation and invites best partners from institutions, academia and private sector to play a role in the process
NMITLI has initiated 60

to establish 8 new IITs, 3 IISERs, 10 NITs and 20 IIITs by 2012

These institutes together

have set up 30 new central universities by 2012

New

universities uncovered states

in

16

account for over 80 per cent of the total PhDs in engineering in India
The

The

the areas of telecom, wireless technology, bioinformatics, lasers and optoelectronic devices and nano-electronics

largely networked projects in diverse areas involving 85 industry partners and 280 R&D groups from different institutions with investment outlay of USD114 million

institutes are also amongst the top Indian applicants for patents from the institutes and universities category

remaining 14 new Central Universities will be set up as world class centers of excellence at different locations universities permitted can enter higher education system in India by having their own campuses or joint ventures with existing universities

Foreign

Source: India Electronic News, Moneycontrol, CNBC, Economic Times, Appliancemagazine.com, Business Standard, The Hindu, Company websites, Aranca Research Notes: R&D - Research and Development

Lupin is a renowned pharma player having a wide range of quality, affordable generic and branded formulations and APIs Lupin has emerged as the fifth largest and among the top five fastest-growing companies in the US It is one of the worlds largest manufacturers of TB drugs and has significant market share in the cardiovascular, diabetology, asthma, paediatrics, CNS, Anti-infectives and NSAIDs therapy segments By FY12, Lupins total patent filing reached 1,024 up from 600 in FY08
38 26 5 FY09

Patents filed by Lupin

84 75

42 26 14 17

42 12

43

FY10

FY11 API/Process patents

FY12 NCE patents

Formulation Patents

Source: Lupin website Note: API - Active Pharmaceutical Ingredient, CNS - Central Nervous System, NSAIDS - Non-Steroidal Anti-Inflammatory Drugs, TB Tuberculosis, NCE - New Chemical Entity

Its revenues increased from USD822.5 million in FY09 to USD1.7 million in FY13, at a CAGR* of 25.8 per cent Advanced market formulations comprised nearly 52 per cent of its revenues in FY12

Lupin net sales (USD million)

1,742

CAGR*: 25.8%
1,271 1,007 822

1,474

FY09

FY10

FY11

FY12

FY13

Source: Lupin website Note: CAGR - Compound Annual Growth Rate CAGR* - Growth in INR terms

Infosys filed the highest number of patent applications in the Indian IT sector, followed by LG Soft India and C-DAC Research activity for different areas is allocated amongst dedicated labs such as Software Engineering lab, Convergence lab, Security and Privacy lab, Distributed Computing lab and E-Com lab
Infosys

Indian IT Patent Applications (FY10)

23

LG Soft India

C-DAC

Newgen Samsung India

Source: Office of the Controller General of Patents, Designs and Trademarks 200910 Annual Report, Company Annual Reports, Aranca Research

During FY0613, the companys revenues increased at a CAGR* of 19.3 per cent to USD7.4 billion from USD2.2 billion During the same period, net profit expanded at a CAGR of 17.8 per cent to USD1.7 billion from USD552 million Infosys spent USD167 million in R&D expenses, up 80 per cent from the USD92 million spent in FY10 Consequently, total R&D spending during FY13 came in at 2.3 per cent of total revenue

Income and net profit (USD billion)

8 7 6 5 4 3 2 1 0 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 2.0 1.8 1.6 1.4 1.2 1.0 0.8 0.6 0.4 0.2 0.0

Source: Company Annual Reports, Aranca Research: Note: CAGR - Compound Annual Growth Rate, * CAGR calculated on rupee numbers

Incorporated in 1933, HUL is Indias leading company by sales in the fast-moving consumer goods (FMCG) sector in India. British-Dutch company Unilever owns a majority stake of 52 per cent in HUL In 2012, Forbes recognised HUL as the world's sixth most innovative company; it was the highest ranked FMCG company in the list Eighteen of HULs brands featured in the 100 Most Trusted Brands 2012 survey carried out by Brand Equity HUL was felicitated for receiving the highest number of patents in 2009 at the Annual Intellectual Property Awards 2010 The company has over 20,000 registered patents and patent applications worldwide

Strong Research and Development

1,612

CAGR*: 34.5%
994

891

FY10

FY11

FY12

Source: Economic Times, Company Annual Reports, Aranca Research Note: CAGR: Compound Annual Growth rate, * CAGR calculated in Indian Rupee terms

During FY0513, HULs revenues increased at a CAGR* of 12.0 per cent to USD4.9 billion from USD2.6 billion During FY12, the company spent USD336 million in R&D, up 62 per cent from the USD218 million spent in FY11
CAGR*: 12.0%
3.7 2.6 2.9

Sales (USD billion)

4.7 4.5 3.8

4.8

4.9

2005

2006

2007

FY09*

FY10

FY11

FY12

FY13

Source: Company Annual Reports, Aranca Research Notes: FY09* represents data for 15 months (Jan 2008- march 2009) as the company changed it reporting period from calendar year to Fiscal year, CAGR* - Compound Annual Growth Rate; CAGR is calculated in INR

Tata Motors, a subsidiary of the Tata Group, is one of the leading automobile company and has presence in 129 countries across six continents Tata Motors is the leading commercial vehicle manufacturer and the third-largest passenger vehicle manufacturer in India It is also the worlds fourth-largest truck manufacturer by volume During FY0612, the number of applications for patents, design, and copyrights filed by the company expanded at a CAGR* of 16.4 per cent to 212 in FY12 Tata Motors Tata Indica is India's first indigenously developed passenger car Tata Nano, a USD2,100 car, is an indigenous example of Indias innovation in the automobile segment

Total Application for Patents, Design and Copyrights Filed

CAGR*: 16.4%
314 254 272 182 212

43

34

FY06

FY07

FY08

FY09

FY10

FY11

FY12

Source: Company Annual Reports, Aranca Research Note: CAGR* - Compound Annual Growth Rate

During FY0613, Tata Motors revenues increased at a CAGR* of 31.8 per cent to USD34.8 billion from USD6.2 billion The companys R&D spend expanded at a CAGR of 16.4 per cent to USD323.1 million in FY12 from USD176.0 million in FY07

Total Application for Patents, Design and Copyrights Filed

CAGR*: 31.8%
28 36

35

20 16 8 6 10

FY06

FY07

FY08

FY09

FY10

FY11

FY12

FY13

Source: Company Annual Reports, Aranca Research Notes: R&D - Research and Development, CAGR - Compound Annual Growth Rate; CAGR is calculated in INR terms

Pharma and Healthcare

Contract research is a fast growing segment in the Indian healthcare industry Indian pharmaceuticals market is anticipated to expand at a CAGR of 17.2 per cent over 2011-2016 to touch USD27.3 billion Indias huge population places it among the worlds largest markets for vaccines and drugs

Information Technology (IT)

India is increasingly seen as a product development destination Companies are now offshoring complete product responsibility including complex services like product management

Automobiles

Research is being carried out by individual companies as well as industry associations such as ARAI in various areas such as structural dynamics, safety, NVH and electronics India is the sixth largest auto market globally and is poised to become the third largest by 2020
Source: ARAI, Business Standard, India Law Office, Aranca Research Notes: IT - Information Technology, ARAI - Automotive Research Association of India, NVH - Noise, Vibration and Harshness

Biotechnology

Protein and antibody production, and fabrication of diagnostic protein chips are promising areas for investment Stem cell research, cell engineering and cell-based therapeutics are other areas, wherein India will cash in its expertise

Agriculture

India has the potential to become a major producer of transgenic rice and several genetically modified (GM) or engineered vegetables Hybrid seeds, including GM seeds, represent new business opportunities in India based on yield improvement
Source: ARAI, Business Standard, India Law Office, Aranca Research Notes: IT - Information Technology, ARAI - Automotive Research Association of India, NVH - Noise, Vibration and Harshness

Automotive Research Association of India (ARAI)

Survey No 102, Vetal Hill, Off Paud Road, Kothrud, Pune - 411 038 Tel: 91-020 30231111 Fax: 91-020 25434190 E-mail: info@araiindia.com Website: www.araiindia.com

Indian Society for Clinical Research (ISCR)

c/o Pfizer center, 5, Patel Estate, S.V.Road, Jogeshwari(West), Mumbai-400 102 Tel: 91-022 26774140, 66932028 E-mail: info@iscr.org Website: www.iscr.org

The South India Textile Research Association (SITRA)

13/37, Avanashi Road, Coimbatore - 641 014 Tel: 91-422 2574367, 6544188 Fax: 91-422 2571896 Email : sitraindia@dataone.in Website: www.sitra.org.in

API: Active Pharmaceutical Ingredient ARAI: Automotive Research Association of India CAGR: Compound Annual Growth Rate CoE: center of Excellence DRDO: Defence Research and Development Organisation FDI: Foreign Direct Investment FY: Indian Financial year (April to March) So FY10 implies April 2009 to March 2010 GDP: Gross Domestic Product GERD: Gross Domestic Expenditure on Research and Development HAL: Hindustan Aeronautics Limited HSL: Hindustan Shipyard Limited

IAC: Indigenous Aircraft Carrier ICBM: Intercontinental Ballistic Missile IT: Information Technology NMITLI: New Millennium Indian Technology Leadership Initiative NVH: Noise Vibration and Harshness PPP: Public Private Partnership PPP: Purchasing Power Parity R&D: Research and Development TRIPS: Trade Related Aspects of Intellectual Property Rights USD: US Dollar WTO: World Trade Organisation Wherever applicable, numbers have been rounded off to the nearest whole number

Exchange Rates (Fiscal Year) Year

2004-05 2005-06 2006-07

Exchange Rates (Calendar Year) Year

2005 2006 2007 2008

INR equivalent of one US$

44.95 44.28 45.28

INR equivalent of one US$

45.55 44.34 39.45 49.21

2007-08
2008-09 2009-10 2010-11 2011-12 2012-13

40.24
45.91 47.41 45.57 47.94 54.31

2009
2010 2011 2012 2013

46.76
45.32 45.64 54.69 54.45
Average for the year

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