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Introduction to the Company Structure of the industry Buyer behavior in the industry Market Segments and positioning Product/Services Strategies Channel and Distribution Strategies Pricing Strategies Marketing and Sales Management Consolidated SWOT Analysis Recommendations for the future

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Kennametal India was established in September 21, 1964, and was formerly known as Widia India Ltd. headquartered at Bangalore is the premiere global provider of metalworking solutions using tungsten carbide inserts. Kennametal is a leading global supplier of tooling, engineered components and advanced materials that are consumed in production processes. It provides customers with a broad range of technologically advanced tools, tooling systems and technical services. The company's expert scientists and engineers apply highly complex powder metallurgy, materials science and mechanical engineering technologies to cemented tungsten carbides, high-speed steels, ceramics, industrial diamonds and other material compositions to produce products that have the optimum combination of resistance to heat, impact, corrosion, pressure and wear to excel in particular application. On May 3, 2002 Kennametal Inc.entered into an arrangement with Milacron B V and Milacron Inc., for the acquisition, either directly or through its affiliates, of Milacron BVs European operations in Germany, Netherlands, Spain, U.K, France and Italy upon obtaining certain statutory approvals and upon certain commercial reorganisation of companies in different countries (hereinafter referred to as the Stock Purchase Agreement). Pursuant to this arrangement, Kennametal was to acquire control of Milacron Metal Working Technologies Holding GmbH, a wholly owned subsidiary of Milacron B. V., which through its subsidiary companies, Widia GmbH and Meturit AG., had indirect control over Widia (India) Limited. As on May 3, 2002, Meturit AG, a wholly owned subsidiary of Widia GmbH, held 51% of the equity shares of the Company. Indirectly, Kennametal acquired from Milacron B. V. the majority of equity shares which resulted in change in control of the Company. Today most of Indias leading manufacturing and industrial giants, from the private, public and government sectors, rely on Kennametal Indias tooling expertise to produce its products. Among others, these include automobile majors like GM, TVS, Tata Motors, and Yamaha, BHEL, Northern Railways, Ordinance and Armament factories, Inter Drill Asia, Escorts Mahle, Gabriel, Sterling Tools and SKF Bearings. Kennametals portfolio of well-respected brand names and broad global presence enable it to help customers of all sizes in virtually every geography drive success at every stage of their value chain. Strategically aligned across its two core businesses -- Metalworking Solutions and Services Group (MSSG)

and the Advanced Materials Solutions Group (AMSG) -- their products and services touch nearly every manufacturing process, and people around the globe can see and touch these results from the time they turn on the light switch in the morning, to the breakfast they eat or the vehicle they drive.

Shareholding pattern - Kennametal India Ltd. Holder's Name Other Companies Foreign Promoter General Public N Banks Mutual Funds Foreign Institutions Foreign NRI Others Financial Institutions No of Shares 184284 19376013 2006637 206274 134811 54390 14791 1040 % Share Holding 0.84% 88.16% 9.13% 0.94% 0.61% 0.25% 0.07% 0.00%

Product range of the company includes: Kennametal has engineered innovative metal-cutting products and techniques for nearly 70 years using complex metallurgy and materials science in tungsten carbide, ceramics, high-speed steels and other materials. Many of these products serve as workhorses in their industries to this day. Newer, more advanced products are always under development to better serve needs. In fact, nearly half of Kennametal's revenue comes from products less than four years old.

Metalworking- Metalworking has been expertise for 70 years. Kennametal never stops inventing, designing, testing, and manufacturing the world's best tools. Energy, Mining & Construction. They work with mining companies worldwide to engineer bold new designs that utilize advanced technologies to increase the productivity of mining and wear products. Advanced Materials- Kennametal specializes in solving unique wear problems by engineering and manufacturing customized protective systems made of the world's toughest materials Wear Components- Kennametal is focused on delivering value to the customers for many different applications that offer long life, maintain tolerance through multiple-use cycles, and deliver superior overall performance. Saw Mill- Kennametal knows how critical uptime and performance are in the sawmill industry. That's why they manufacture a wide range of Carbide and APF Superalloy cutting tips for the sawmill industry worldwide.

Services Service and Repair Your tools are a valuable investment. Protect them, as you would any investment. Restore your tools to like-new condition for half the cost of new with Kennametals expert repair service.We repair and service pocketed tooling and non-pocketed tooling. The average repair costs about 50% less than the cost of a tool new.

Reconditioning Services Reconditioning your tools is smart for your business and the environment. You save money, reduce inventory, and avoid material waste. We make it easy! Just follow these simple steps to start saving today! Cost Per Part Program Its like having the perfect house guest: we come only when invited; we use our own stuff; and we help you out while were there. And during our stay, we save you money. Kennametals Cost Per Part (CPP) program could be the perfect house guest at your shop for proven production methods with guaranteed savings. The CPP program reduces overall costs per part by managing tooling, increasing efficiency, and tracking outcomes. We guarantee a specific cost per part savings and partner with you for your long-term success.

Supply Chain Services

If the phrase where is the ? is heard around your shop, its time for an efficient tool management system.

ToolBOSS is such a system. Its not a vending machine. Kennametal TooLBOSS is a secure, electronically locked tool storage cabinet with 24-hour tool control over high value items like carbide inserts, drills, and taps. It issues tools, returns tools, sends tools to re-work, supports EDI ordering, and has multi-vendor security.Whats more, its easy to use. Users are given access permission, and you can only select tools youre permitted to access. Each transaction is logged and time-stamped through the ToolBOSS inventory management software

Industry Solutions

Aerospace Earthworks Energy Transportation General Engineering Machine Tool Industry

Product Name Hard Metal and Hard Metal Products Special Purpose Machines including accessories (Machine Tools) Jigs and Fixtures (Machine Tools)

Year Month 2011

Sales Sales % of STO Quantity Value(Rs.Million) 4400.85 81.47

06 14086612.00











2011 Others Hard Metal and Hard Metal Products Including Tools Traded 2011 Others - Traded














Indian Machine Tool Industry

India stands 12th in production and 7th in the consumption of machine tools in the world as per the latest survey. The country is set to become a key player in the global machine tools industry and is likely to see substantial high-end machine tool manufacturing. Industry experts say that the phenomenon is linked to the spurt in manufacturing, for which the machine tools sector serves as the mother industry. Since, the manufacturing capacity is stagnating and the growth rate for the machine tools industry falling in developed economies, shifting machine tool capacity to low-cost high skill geographies like India, has become imperative. The Indian Machine tool Industry has around 1000 units in the production of machine tools, accessories/attachments, subsystems and parts. Of these, around 20in the large scale sector account for 70 percent of the turnover and the rest are in the SME sector of the industry. Approximately, 75 per cent of the Indian machine tool producers are ISO certified. While the large organized players cater to Indias heavy and medium industries, the smallscale sector meets the demand of ancillary and other units. Many machine tool manufacturers have also obtained CE Marking certification, in keeping with the requirements of the European markets.

Indian Machine Tool Industry 2010-11 & 2011-12 (INR Million) 2010-11 Production Exports Imports Consumption 36,238 1,358 67,033 1,01,913 2011-12 42,990 1,802 76,454 1,17,642 Growth Rate 19% 33% 11% 15%

The industry can be segmented in several ways:




Rs. 3,322 million (74 USD Million)

RS. 1,717 million (38 USD million)


Rs. 3,2486 million (722 USD Million)

Rs. 5,466 million (122 USD million)

The Indian machine tools sector offers several opportunities for investment. Given the current gap between demand and supply, there is a clear need for adding capacities in this sector. The industry is moving towards increasingly sophisticated CNC machines, driven by demand from key user segments, such as, automobiles and consumer durables. Machine tool manufacturers need to develop capabilities to cater to this demand and investments in this area could yield long term benefits

Company Engineers India Thermax AIA Engineering Kennametal India Texmaco Rail & Eng. Disa India Hercules Hoists Sanghvi Movers Sulzer India Mcnally Bharat Engg TRF Om Metals Infraproj. Guj. Apollo Inds

Sales Current (Rs.Million) Price 38984.52 241.10 53040.60 12723.32 5056.51 7674.34 1539.85 1210.01 4504.74 1616.90 20792.03 8023.11 2333.53 2177.80 577.90 374.20 1085.55 64.85 2941.65 136.30 100.10 1161.10 114.25 261.35 25.00 135.65

Change (%) -0.74 3.92 2.97 3.00 2.45 -2.81 -0.94 -1.23 0.00 -2.23 -4.11 -0.20 -0.70

P/E Market 52-Week Ratio Cap.(Rs.Million) High/Low 12.64 81235.41 289/195 17.47 24.07 34.89 14.64 18.13 14.27 5.14 26.72 6.53 187.48 9.99 12.89 68860.43 35294.68 584/388 395/250

23858.48 1247/641 11804.42 88/47

4442.49 3944/1401 4361.60 4333.13 164/95 126/85

4005.80 1162/1151 3552.47 2876.00 2407.60 2248.40 131/80 385/195 38/20 155/112

Emerging trends An opportunity in form of Engineering Services Outsourcing (ESO) presents itself before this sector. It is estimated that the global engineering services spend will reach US $850 bn by 2020, with 180 billion expected to flow through the outsourcing channel into vendor countries. India can bring home about 2530 per cent of this outsourced revenue.

Future outlook Governments focus on infrastructure development is expected to keep demand for the engineering sector high. Continued growth of manufacturing sector and favourable regulatory policies would further propel the sectors growth. Engineering Services Outsourcing (ESO) services from India has the potential to exceed US $40bn by 2020, and with the right support from Government and other stakeholders, can impact the engineering sector as a whole.

Success through people

At Kennametal, we are committed to being the employer of choice for the best people. Our success relies on our 14,000 employees located in more than 60 countries across the globe. We believe it is essential to have the right people, with the right skills, at the right time and place to continually drive shareowner value and execute our strategy Through our Talent Development System, a key component of our KVBS management operating system, we offer programs that enable our team to continuously grow and contribute to our success.

Finding And Serving Customer

We are where our customers need us to be. Quick, thorough response to customer needs has been a key component of Kennametal's success. The application experts who make up our field sales force work directly on the customer shop floor, at the mine face or on the construction site to solve problems and increase productivity. Kennametal's real-time, online customer service system provides instantaneous information on global product availability, order status and application solutions. Continued global growth organically and through acquisitions is a key strategy for Kennametal. Acquisitions in our core businesses are conducted according to a disciplined process that is part of KVBS. Recent acquisitions enable us to enhance our technologies to better engineer our customers competitive edge. We also continue to expand our reach through our distribution and channel / brand strategy touching more customers through our strong distribution partnerships. Kennametal delivers productivity and savings to our customers across a range of industries and networks. Brand portfolio management drives down our cost-to-serve as we continue to grow and makes our brands more distinct for our customers.