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Chrome Ore Market IndiaChrome Ore Market – India
April 2013
Executive Summary
Market
Chrome ore finds extensive application in the production of ferro chrome which in turn is used in the production of steel India is the x largest producer of chrome ore and the y largest exporter of chrome ore in the world
D i h ll
Drivers & Challenges
Drivers•Robust Metallurgical Industry •Growing Refractory Industry •Well Established Foundry Industry
d h l
Challenges•Environmental Concerns
•Low Chrome Ore Resources
Challenges
Chrome Ore Export Regulation
•Expanding Chemical Sector •Healthy Economic Outlook
Industry Regulations
Specifications Of Exportable Grades Friable Chrome Ore
Specifications Of Chrome Concentrates
Specifications Of Lumpy Chrome Ore
Chromite – Trade Policy
Competition
Major Players
Player A Player B
Player C Player D
2
Player C Player D
Player E Player F
CHROME ORE MARKET IN INDIA 2013.PPT
•Macro Economic Indicators
• Introduction
• Market OverviewMarket Overview
• Chrome Ore Price Trend
• Chrome Ore Reserves
Ch O E l ti A ti iti• Chrome Ore Exploration Activities
• Chrome Ore Mine Allocation
• Export Import
• Chrome Ore Specifications
• Drivers and Challenges
• Industry RegulationsIndustry Regulations
• Recent Developments
• Competitive Landscape
St t i I iti ti
3
• Strategic Initiatives
• AppendixCHROME ORE MARKET IN INDIA 2013.PPT
Macro Economic Indicators (1/3)
INR tn
14y4z4y3
x2x1
GDP at Factor Cost: X
13
12
11
k4z3
k3
x2y2
z2
k2
x1y1
z1
k1
10Q‐Q‐Q‐Q ‐
20‐‐20‐‐20‐‐20‐‐
Inflation Rate: Y
0 8
1.0 x3x1
%
0.2
0.4
0.6
0.8
x5x4x2
4
0.020‐‐20‐‐20‐‐20‐‐20‐‐
BEARINGS MARKET IN INDIA 2013.PPT
India needs a progressive market development strategy and technological competitiveness to ensure market growth
Chrome Ore Production (1/2)
mn tonnes Z%
3
4
5x10
x9x8
x7x6x4
x3
x5x2
x1
0
1
2
020‐‐e20‐‐e20‐‐e20‐‐e20‐‐e20‐‐20‐‐20‐‐ 20‐‐20‐‐
• India is the x largest producer of chrome ore and the y largest exporter of chrome ore in the world
•Growing demand for chrome ore in the X coupled with shortages occurring in supplies of Country A and Country B ore due to increased consumption in Country C ferro alloy industry provides a major growth opportunity to the Indian
5
due to increased consumption in Country C ferro alloy industry provides a major growth opportunity to the Indian chrome ore market
CHROME ORE MARKET IN INDIA 2013.PPT
Total chrome ore reserves in India is x million tonnes of which y million tonnes are under z category Chrome Ore Reserves / Resources ( tonnes )
Grades Reserves Remaining Resources Total Resources
Grade A ‐ ‐ ‐
Grade B ‐ ‐ ‐
Grade C ‐ ‐ ‐
Grade D ‐ ‐ ‐
G d EGrade E ‐ ‐ ‐
Grade F ‐ ‐ ‐
Grade G ‐ ‐ ‐
Grade H ‐ ‐ ‐Grade H
x1G d A
x5
x2
Grade E
Grade D
Grade B
Grade C
Grade A •Point 1•Point 2•Point 3•Point 4
6
x4x3
Grade E
CHROME ORE MARKET IN INDIA 2013.PPT
Indian chrome ore exports have witnessed a steady decline over the last four years
‘000 tonnesINR bnx1 Volume
Value
Exports• Point 1• Point 2
Exports (Value and Volume)
5
10
500
1,000
1,500
2,000
x3x4
y4y3
x2
y2
x1
y1
• Point 3
0 020‐‐ 20‐‐
y
20‐‐20‐‐
Segmentation – Value (20‐‐) Segmentation – Volume (20‐‐)
x3
x1x2
Country B
Country C
Country Ax3x1 Country A
Country B
Country C
Country D
7
x4 x2
CHROME ORE MARKET IN INDIA 2013.PPT
Drivers & Challenges – Summary
Drivers
Robust Metallurgical Industry
Growing Refractory Industry
Challenges
Environmental Concerns
Well Established Foundry Industry
Expanding Chemical Sector
Low Chrome Ore Resources
Healthy Economic Outlook
8CHROME ORE MARKET IN INDIA 2013.PPT
Growing metallurgical industry will lead to higher demand for ferro alloys..
Robust Metallurgical Industry (1/3) Impact
• Finding 1
• Finding 2
• Finding 3
• Finding 4
Historical Demand
Ferrro‐chrome Demand
Forecasted Demand
1.0
1.2
mn tonnesZ%
x4x3
x12.0
1.73
mn tonnes
1.57Z%1 41
BA
0 2
0.4
0.6
0.8
x3x2
0.5
1.0
1.5
53%
53%
47%
53%53%53%
47%47%
1.16 1.281.41
1.06
47%
53%
9
0.0
0.2
20‐‐20‐‐20‐‐20‐‐0.0
20‐‐
47%
20‐‐
47%
20‐‐20‐‐
47%
20‐‐
47%
20‐‐
47% 47%
CHROME ORE MARKET IN INDIA 2013.PPT
SAMPLE Industry Regulations – Summary
Chrome Ore Export Regulation
Specifications Of Exportable Grades Friable Chrome Ore
` Specifications Of Chrome ConcentratesKey RegulationsRegulations
Specifications Of Lumpy Chrome Ore
Chromite – Trade Policy
10CHROME ORE MARKET IN INDIA 2013.PPT
Competitive Benchmarking (1/5)
Public Trading Comparables (FY 20‐‐)
Company 1 Company 2 Company 3 Company 4
Market Capitalization (INR mn)
‐ ‐ ‐ ‐
Share Price (INR) ‐ ‐ ‐ ‐
EV/EBITDA (x) ‐ ‐ ‐ ‐
/EV/Revenue (x) ‐ ‐ ‐ ‐
PE Ratio ‐ ‐ ‐ ‐
11BEARINGS MARKET IN INDIA 2013.PPT
Public: Domestic Company – Company A (1/4)
Company Information Offices and Centres – India
Corporate Address Address
Tel No. 91 ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐Tel No. 91
Fax No. 91 ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Website website
Year of Incorporation 19‐‐
Products and Services
Ticker Symbol ‐‐‐‐‐‐
Stock Exchange ‐‐‐
Key People
Products and Services
Category Products/Services
Segment Product 1, product 2, product N D i ti
Head Office
3,………………….
Others Product 1, product 2, product 3………
Name Designation
Person 1 Designation
Person 2 Designation
Person 3 Designation
12
, p , pPerson 4 Designation
BEARINGS MARKET IN INDIA 2013.PPT
i i l S h K i
Public: Domestic Company – Company A (2/4)
Financial Snapshot Key Ratios
Profit / Loss
Total Income
10,000 600
ProfitINR mn
Total IncomeINR mn
y3y4
Particulars y‐o‐y change (2012‐11)
2012 2011 2010 2009
Profitability RatiosOperating Margin 2.39 15.82% 13.43% 7.52% 18.81%
0
5,000
0
200
400x4
20‐‐
y3
20‐‐
x3
20‐‐ 20‐‐
y1
x1
y2
x2
Net Margin 1.19 5.35% 4.15% 2.80% 0.14%
Profit Before Tax Margin 1.89 8.19% 6.31% 4.66% 1.09%
Return on Equity 0.60 3.36% 2.76% 1.24% 0.36%
Return on Capital Employed 1.12 9.35% 8.23% 3.03% 34.42%
Return on Working Capital ‐4.90 ‐78.05% ‐73.15% ‐61.05% ‐300.99%
Return on Assets 1.04 7.17% 6.12% 2.41% 17.34%
Financial Summary
• The company earned a net profit of INR x mn in FY 20‐‐, as compared to net profit of INR y mn in FY 20‐‐
• The company reported total Income of INR x mn in FY 20‐‐registering an increase of x% over FY 20
Return on Fixed Assets 1.10 8.91% 7.81% 2.90% 31.39%
Cost RatiosOperating costs (% of Sales) ‐2.41 84.00% 86.42% 91.91% 81.00%
Administration costs (% of Sales)
2.23 9.61% 7.38% 8.51% 9.82%
Interest costs (% of Sales) 0.21 6.90% 6.69% 9.01% 6.41%registering an increase of x% over FY 20‐‐
• The company earned an operating margin of x% in FY 20‐‐, a decrease of y percentage points over FY 20‐‐
• The company reported debt to equity ratio of x in FY 20‐‐, an increase of y% over FY 20‐‐
Interest costs (% of Sales) 0.21 6.90% 6.69% 9.01% 6.41%
Liquidity RatiosCurrent Ratio ‐9.82% 0.61 0.67 0.81 0.88
Cash Ratio ‐13.72% 0.07 0.09 0.07 0.06
Leverage RatiosDebt to Equity Ratio ‐32.40% 0.13 0.20 0.15 0.76
Financial Summary
Indicators Value Market Capitalization (INR) ‐
Total Enterprise Value (INR) ‐
Debt to Capital Ratio ‐28.61% 0.12 0.16 0.13 0.43
Interest Coverage Ratio 14.21% 2.32 2.03 0.90 2.97
Efficiency RatiosFixed Asset Turnover ‐3.11% 0.56 0.57 0.36 1.65
Asset Turnover ‐0.63% 0.45 0.45 0.30 0.91
Current Asset Turnover 20.77% 3.16 2.62 1.81 2.08
13
EPS (INR) ‐PE Ratio (Absolute) ‐
BEARINGS MARKET IN INDIA 2013.PPT
Cu e t sset u o eWorking Capital Turnover ‐9.39% ‐4.88 ‐5.38 ‐7.55 ‐15.84
Capital Employed Turnover ‐0.20% 0.55 0.55 0.36 1.46
Improved Decline
Public: Domestic Company – Company A (2/4)
Key Business Segments Key Geographic Segments
100%
A
100%
A B
0%
50%
100%
100%
0%
50%
100%
y4y3
x1x3
y1
x2
y2
x4A is the only business segment of the company
Business Highlights
0%20‐‐
0%20‐‐20‐‐20‐‐20‐‐
Description News
Overview
• Company A is a part of the B Companies and is one of the leading producers and suppliers of x
• Company has been allotted a captive chrome ore mine in Place A in J in X district of State BB
• It has x furnaces with total capacity of y MVA to produce z MT bulk A per annum
Beneficiation Plant• X plant of the company was commissioned in 20‐‐ with a capacity of x mt/hr• Plant has y from Company A and y from Company B and the z has been done by Company C with Z system
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C t syste
CHROME ORE MARKET IN INDIA 2013.PPT
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CHROME ORE MARKET IN INDIA 2013.PPT