Indian Economy Opportunities Unlimited

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India: Fastest Growing Free Market Democracy

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4/14/12

India: Among the Top-15 Countries in terms of GDP at constant prices

Indias GDP witnessed high growth and was the second fastest growing GDP after China

The Indian economy has witnessed an unprecedented growth. Booming Indian services and industry sector are providing the required impetus to the economic growth
8 . 4 % 9 . 4 %

8 . 5 % 4 %

7 . 5 %

Fastest GDP growth of 9.4 percent in 2006-07, since last 18 years

Indian economy is the 4th largest in terms of PPP USD 4.1 trillion in 2006

The sound performance of each industry segment is leading to the overall robust performance of the Indian economy

Contribution of Services increased from 49 percent to 55 percent

Growth in sectors (2006-07): Industry: 10.9% Services: 11% Agriculture: 2.7%

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India: Robust Economic Platform

Indias enhanced economic performance has been the major contributor towards increased Forex reserves

at present level of Forex reserves, the country has adequate cover for 12 months of imports

Steadily increasing Forex reserves offer adequate security against any possible currency crisis or monetary instability

Forex reserves witnessed an increase of 200 percent for the period 1990-2007

Falling Dollar inflates the Indias external debt

Indias Forex reserves are in excess of external debt

Increased confidence of investors in Indian companies have led to a surge in cross border borrowing by the corporate houses

the decreasing external debt to GDP ratio indicates that India has a sound economic platform

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India: Surging Exports

Services sector has been a major contributor to increased exports from India

Acceptance of Indian products along with the cost advantage has provided an edge to Indian companies

Quality and cost advantage are the two important parameters leveraged by the Indian producers to increasingly market their products and services

Indian companies have chalked out extensive plans to increase their presence abroad

Imports of products by India mainly includes petroleum products and minerals

Petroleum products are the major contributors towards Indias growing imports

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India: Attractive Investment Destination

With improved performance on PE ratio and ROE, Indian markets have attracted large investments

India is ranked second in AT Kearney FDI confidence index

Telecom and Electronics topped the list of inward FDI

India

Return on the Investments in India (2006 Q1)

Market PE Ratio 16.1 10.62 10.26 9.85 13.21 12.17 9.84 11.19 9.35 10.9 P/B Ratio 4.53 2.06 3.09 1.84 1.82 2 2.32 2.12 2.46 2.39 22 17 NA 16 16 11 23 15 18 15 RoE (%)

180 percent Increase

FDI inflow for the period 2006-07 witnessed a growth of 180 percent over the same period last year

China Indonesia Korea Malaysia Taiwan Thailand EM Asia

Mauritius has been the largest contributor towards FDI into India..

Latin America EM Europe

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India: Vibrant Capital Market

Sensex The Bombay stock exchange index has risen 15 times from 1990s to reach 15,000 mark in July 2007

India is among the major destinations across the globe for inflow of US Dollar i.e. FIIs

Sensex risen 15 times in the period 1990-2007

1/12/200 7 Crossed 14,000 mark 2/7/200 6 Crossed 10,000 mark

7/9/2007 Crossed 15,000 mark

FIIs augmented support by infusing large investments in Indian stock market

Emergence of industry and confidence of local investors along with the FIIs has led to increased movement of sensex

12/30/19 99 Crossed 5,000 mark

Exorbitant industry performance

Increased local investors confidence

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Major M&A Deals Undertaken Abroad by India Inc.

T at a St ee l Hi bu nd ys al C co or ac us qu Pl Es ir c sa ed r N St ov ee eli l s S ac In uz qu c. lo ir n ed E Al ne go Vi rg m de y a oc Lt St o d. ee n ac l In qu du

USD 12.1 billion

USD 6 billion

USD 1.58 billion

USD 1.6 billion

USD 730 million

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Major M&A and Investments Announcements in India

V od af o ne bu Pl ys an H s ut to ch sp en Pl d an o s n in its ve de st A ve m di lo en ty p t a m in Bi R en pr rl en t iv a au o at G lt, pe e ro Ni ra eq up ss ti ui in M an o ty cr yl an ns , ea an d in re se L M In al d ab ah

USD 11 billion

USD 1.7 billion

USD 1 billion

USD 0.98 billion

USD 0.905 billion

USD 0.74 billion

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India: Pacing Ahead to Emerge as a Major Economy in the World

India has been ranked superior to other major countries by many prominent surveys AT Kearney placed India among the top three in its FDI confidence index
2007 Global Retail Development Index (GRDI)

the retail market along with the services sector has been attracting the interest of major players

India is expected to outperform its rivals in the BRIC, in terms of GDP growth rates, from 2015 onwards

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India: Astounding Demographics

DEMOGRAPHIC TRANSFORMATION OF INDIA
Annual Household Income (in USD) 2 9 9 17 74 285 710 20 33 120 404 613 Rich (Above 115,000) High Income (57,000 115,000) Consuming class (23,000 57,000) Working class (10,200 23,000) Needy (Below 10,200) * In PPP terms

Population (million)

Growth in the higher income categories of Indias population has created an affluent section of society, which has significant level of purchasing power

200102

4 8 22 1 72 6

200506

200910(E)

Increasing per capita income and large population moving into middle class has led to high level of consumerism in India

Increasing per capita income coupled with an emerging middle class has provided the necessary impetus to consumerism in India

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India: Increasing Working Population

Growth in Global Working Age Population (15-64)
Stock Position 2005 World 4,168 India 691 Africa 500 China 934 South East Asia 362 Latin America 359 Southern Asia 132 USA 200 Europe 497 Japan 85
In Million

Addition to Working Age Population by 2010

Countries worldwide are anticipating a shortage of working population in the future. India is expected to emerge as a clear winner, and by 2050, it will have the largest working age population.

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Growth Expected in India

To sustain the GDP growth of more than 8 percent, India requires an investment of USD 1.5 trillion in the next five years

2010
q

GDP USD 900 billion GDP growth rate 9% Services contribution 60-65 % FDI limit is expected to be 100 percent in major industry sectors such as Telecom, Semiconductors, Automobiles, etc. Balance of Trade Should be positive with increased level of exports as compared with imports Investment goal USD 370 billion

2008
q

GDP USD 750 billion GDP growth rate 9.5% Services contribution 60 % FDI limit is expected to be close to 100 percent in major industry sectors such as Telecom, Semiconductors, Automobiles, etc. Balance of Trade Should increase with surging exports as compared with imports Investment goal USD 305 billion

2006
q

GDP USD 590 billion GDP growth rate 9 % Services contribution 54 % FDI limit not 100 percent in major industry sectors such as Telecom, Semiconductors, Automobiles, etc. Balance of Trade USD (-)46.2 billion Investment goal USD 250 billion

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Why India? Quote Unquote

India has evolved into one of the world's leading technology centers.
Craig Barrett Intel Corporation

India is among the three most attractive FDI destinations in the world.
A T Kearney FDI Confidence Index 2005

India has among the highest returns on foreign investment.

US Department of Commerce

By 2032, India will be among the three largest economies in the world.

BRIC Report, Goldman Sachs

We came to India for the costs, stayed for the quality and are now investing for innovation.
- Dan Scheinman, Cisco System Inc. as told to Business Week, August 2005

India is a developed country as far as intellectual capital is concerned.

Jack Welch General Electric

The Indian market has two core advantages - an increasing presence of multinationals and an upswing in the IT exports.
Travyn Rhall, ACNielsen

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