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India a huge opportunity for Growth

James Randall Tokyo October 2010

GfK Retail and Technology

India A Growth Opportunity, James Randall

October 2010

India, diversity in numbers:


1,156,897,766 Population

16 Official Languages & 1,650 Dialects 82% Hindu, 12% Muslim, 2% Christian, 2% Sikh and 1.5% Buddhist 75% rural in 615,000 villages
27 States, 4,378 towns
35 Metro Cities 1m+ population 39 Towns 0.5m 1m population 320 Towns 100 500k population 3,984 Towns up to 100k population

Retail Share:
Metros

49% 0.5m - 1m pop

14%

18%

20%

100 - 500k pop

up to 100k pop

Source: GfK nielsen India and Government of India Census

GfK Retail and Technology

India A Growth Opportunity, James Randall

October 2010

Exploding population:

Predicted to be the largest population in the world by 2026 at 1,471,000,000


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Fastest growing working age population

Over 50% of the population is below 25 years of age

0 14 yrs 15 64 yrs 65+ Population + 19m a year

19% 60% 21%

31% 64% 5%

in 2020 average Indian will be 29yrs (v 37 yrs in China)

Source: National Population Stabilisation fund

GfK Retail and Technology

India A Growth Opportunity, James Randall

October 2010

The fastest growing population. :


2009 GDP (current prices IMF 2009):
$14,256bn $4,908bn

Experiencing rapid growth but with a very low GDP Per Capita
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$5,068bn

$1,235bn

$3,352bn

9.7%

9.2%

6.7%

7.2% Indian GDP

8.2%

9.0%

2006 - 07

'07 - 08

'08 - 09

'09 - 10*

'10 - 11*

'11 - 12*

2009 GDP Nominal Per Capita:


$46,381 $3,678 $39,731 $1,031 $40,875

Value of final goods & services produced by nation in a year, converted marketexch rate to US$ divided by the average (or mid-year) Source: IMF and Indian PMs Economic Advisory Council Forecast

GfK Retail and Technology

India A Growth Opportunity, James Randall

October 2010

In 2 decades will grow from 5% to 40%, their incomes will balloon to $1.1bn (x11)

Growing middle classes become worlds 5th consumer group:


5

Between 2000 & 2009 Rich & consuming grew by 59% or 34m HOUSEHOLDS!
Rich (US$ +5,000 p.a.) Consuming (US$ 1200 5000 p.a.)

The Classes

1990

2000

2008-09

1 29

3 55

7 85

The next 10 years could see 55m extra consuming households (2x UK)

Climbers (US$ 500 1200 p.a.)

48

66

90

Aspirants (US$ +350 - 500 p.a.)

48 35

32 24

32

Destitute (US$ < 350)

15

Source: National Council of Applied Economic Research (Household in mn.)

GfK Retail and Technology

India A Growth Opportunity, James Randall

October 2010

2010 = huge market growth rates in India:


6

87%

37%

37%

35% 20% 14% 12% 12%


Microwave 1m

Category:

LCD/Plasma (millions units) 3m

Mobile 139m

AC 4m

Notebook 3m

DSC Refrigeration WM 2m 8m 4m

Source: GfK nielsen India retail sales

GfK Retail and Technology

India A Growth Opportunity, James Randall

October 2010

Low Penetration of Products & Growing Middle Class:


TV & Mobile Phone Cross Class & Rural Divide
55.0%

Rural Share:

10% 31% 6%

55.0%

19.0%

Penetration
7.0%

8% 2%

3.0%

As Indians become Middle Class they expect: Refrigerator, Washing Machine, Air Conditioner and a PC

Source: GfK nielsen India retail sales

GfK Retail and Technology

India A Growth Opportunity, James Randall

October 2010

New Customer in India in the next decade:

Mobile Penetration reaches 85%, TV 75% H.H. and 147m Consuming Households by 2020
8

366

223

220

113

New Customers in Millions


103

Source: GfK nielsen India retail sales

GfK Retail and Technology

India A Growth Opportunity, James Randall

October 2010

Exploiting the Market Opportunity:


LCD Brand Share by country Jan 2010:
49 38 10
9

Korean Brands, well established & manufacture in India

Aug 2010: 615 3D TVs sold

GfK Retail and Technology

India A Growth Opportunity, James Randall

October 2010

India: a growth opportunity?


Summary:
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1.2bn people in 4,378 towns and 610k villages (50% sales in Metros) Population grows by 19m people a year (approx size of Australia or NL) 50% of Indian Population is under 25...... Indian Middle Class set to grow by 55m Households in 10 years Indian Middle Class forecast to become worlds 5th consumer group Low penetration provide double digit growth rates for years to come Masses of opportunity for new entrants

India a huge opportunity for Growth


James Randall Tokyo October 2010

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