Mobile Advertising Market - India

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1 Mobile Advertising Market - India February 2015

2 Executive Summary Market Overview Global market size of mobile advertising stood at INR a1 bn in 20--, growing at a CAGR of a2% from the previous year Market size of mobile advertising in 20-- and 20-- was around INR a3 bn and INR a4 bn respectively in India It is in state1 which are statement1 across the country at element1 Drivers & Challenges Recent Developments Drivers: Rising Mobile Device Adoption and Colossal Wireless Subscriber Base Growing Demand for Rich Digital Contents High Affordability Introduction and Availability of Next Generation Cellular Networks Development1 Development2 Development3 Challenges: Affordability of Next Generation Mobile Networks Low Smartphone and Tablet Penetration in Rural Areas Key Players Competitive Landscape InMobi Technology Services Pvt. Ltd. Komli Media India Pvt. Ltd. Ozone Media Solutions Pvt. Ltd. PK Online Ventures Pvt. Ltd. SVG Media Pvt. Ltd. AdMob Google Inc. 2

3 Macroeconomic Indicators Introduction Market Overview Drivers and Challenges Recent Development Competitive Landscape Strategic Recommendations Appendix 3

4 Economic Indicators (-/-) GDP at Factor Cost: Quarterly INR tn d1 c1 b1 a1 d2 c2 b2 a2 c3 b3 a3 c4 b4 a4 11 Q1 Q Q Q4 Inflation Rate: Monthly 2.0 % p 1.5 s 1.0 q t 0.5 r 0.0 Jun Jul 2013 Jul Aug 2013 Aug Sep 2013 Sep Oct 2013 Oct Nov

5 Introduction Mobile Advertising (Ad) Overview Mobile advertising is the act of using mobile devices such as cellular phones and Tablet PCs as a medium to deliver promotional messages Mobile advertising is a subset of mobile marketing but it is often used interchangeably With rising competition and growing need for customer acquisition, newer mediums and methods of advertising and promotion are becoming very crucial The overall aim is to reach the target consumer with the effectual product promotion in terms of interests, demographical characteristics and relevant geological location With exponentially growing number of active mobile devices and usage trends of mobile services and Value Added Services (VAS), India is rapidly becoming one of the most attractive market for mobile marketers and advertisers Mobile Marketing Activities Mobile Website of Company Mobile Advertising Mobile Application of the Company Mobile Version of Newsletters Location Based Services Mobile Marketing Voice Communication 5

6 Solution1 and solution2 are the most popular services in India Market Overview India (1/2) Revenue from mobile advertising stood at INR in 20--, growing at a CAGR of from the previous year Market size of mobile advertising in 20-- and 20-- was around INR and INR respectively mobile advertising Market Size & Growth INR bn a1 a2 a3 +y% a4 a5 a mobile advertising market is in condition1 and it is still at a nascent stage in India It is in state1 which are statement1 across the country at element1 Text text text text text text text text text text text text text text text text text text text text text text text text text Text text text text text text text text text text text text text text text text text text text text text 6

7 Drivers and Challenges Summary Drivers Rising Mobile Device Adoption and Colossal Wireless Subscriber Base Growing Demand for Rich Digital Contents Challenges Affordability of Next Generation Mobile Networks Low Smartphone and Tablet Penetration in Rural Areas High Affordability Introduction and Availability of Next Generation Cellular Networks 7

8 Recent Developments (-/-) Development1 text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text Development2 text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text Development3 text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text Development4 text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text 8

9 Porter s Five Forces Analysis SAMPLE Threat of New Entrants Text text text text text text text text text text text text text text text text text text text text text text text text text Impact Medium Impact Medium Impact Medium Impact High Bargaining Power of Suppliers Text text text text text text text text text text text text text text text text text text text text text text text text text Competitive Rivalry Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text Bargaining Power of Buyers Text text text text text text text text text text text text text text text text text text text text text text text text text Threat of Substitutes Text text text text text text text text text text text text text text text text text text text text text text text text text Impact Low 9

10 Competitive Benchmarking (-/-) SAMPLE Key Ratios of Top 4 Companies Operational Basis (FY 2013) (1/3) % Operating Margin Net Margin b1 c1 d1 a1 c2 d2 0 company1 a2 company2 b2 company3 company4 Company1 recorded operating margin of -%, higher than that of company2, company3 and company4 which recorded operating margin of -%, - and -% respectively Thermax however recorded the highest net margin of -% higher than that of Ion Exchange, SPML and Va Tech Wabag which recorded net margins of -%, -% and -% respectively 10

11 Public: Domestic Company Company SAMPLE 1 (1/4) Company Information Offices and Centres India Corporate Address Tel No. Fax No. Website Year of Incorporation Ticker Symbol Stock Exchange Head Office Products and Services Category Sectors (EPC) Products/Services Key People Name Designation 11

12 Public: Domestic Company Company 1 (2/4) Financial Snapshot SAMPLE Key Ratios INR bn 0 s1 t Financial Summary The company incurred a net loss of INR - bn in FY 2013, as compared to net profit of INR - bn in FY 2012 The company reported total income of INR - bn in FY 2013, registering a decrease of -% over FY 2012 The company earned an operating margin of -% in FY 2013, a decrease of - percentage points over FY 2012 The company reported debt to equity ratio of - in FY 2013, an increase of - % over FY 2012 Key Financial Performance Indicators Indicators Value (17/01/2014) Market Capitalization (INR mn) Total Enterprise Value (INR mn) EPS (INR) PE Ratio (Absolute) Total Income s2 t Net Profit/Loss s3 t s4 t INR bn Particulars Profitability Ratios Operating Margin Net Margin Profit Before Tax Margin Return on Equity Return on Capital Employed Return on Working Capital Return on Assets Return on Fixed Assets Cost Ratios Operating costs (% of Sales) Administration costs (% of Sales) Interest costs (% of Sales) Liquidity Ratios Current Ratio Cash Ratio Leverage Ratios Debt to Equity Ratio Debt to Capital Ratio Interest Coverage Ratio Efficiency Ratios Fixed Asset Turnover Asset Turnover Current Asset Turnover Working Capital Turnover Capital Employed Turnover y-o-y change ( ) Improved Decline 12

13 Public: Domestic Company Company 1 (3/4) Key Business Segments SAMPLE Key Geographic Segments Construction and Engineering India Overseas g1 e1 e2 e3 e4 0% % f f f f Business Highlights Description News Overview Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text Extensive Product Portfolio Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text 13

14 Public: Domestic Company Company SAMPLE 1 (4/4) S W O T 14

15 Private: Domestic Company Company SAMPLE 2 (1/5) Company Information Offices and Centres India Corporate Address Tel No. Fax No. Website Year of Incorporation Products and Services Ahmedabad Head Office Category Products Products/Services Key People Name Designation 15

16 SAMPLE Private: Domestic Company Company 2 (2/5) Shareholders of the Company as on Ownership Structure Name No. of Shares held Corporate Bodies Foreign holdings X X 30% Total 70% 16

17 Financial Snapshot SAMPLE Private: Domestic Company Company 2 (3/5) Key Ratios INR mn 0 u1 v Financial Summary Total Income u2 v2 Net Profit/Loss u3 v The company earned a net profit of INR - mn in FY 2013, as compared to net loss of INR - mn in FY 2012 The company reported total income of INR - mn in FY 2013, registering an increase of -% over FY 2012 The company earned an operating margin of -% in FY 2013, an increase of - percentage points over FY 2012 The company reported debt to equity ratio of - in FY 2013, a decrease of -% over FY 2012 u4 v4 INR mn Particulars Profitability Ratios Operating Margin Net Margin Profit Before Tax Margin Return on Equity Return on Capital Employed Return on Working Capital Return on Assets Return on Fixed Assets Cost Ratios Operating costs (% of Sales) Administration costs (% of Sales) Interest costs (% of Sales) Liquidity Ratios Current Ratio Cash Ratio Leverage Ratios Debt to Equity Ratio Debt to Capital Ratio Interest Coverage Ratio Efficiency Ratios Fixed Asset Turnover Asset Turnover Current Asset Turnover Working Capital Turnover Capital Employed Turnover y-o-y change ( ) Improved Decline 17

18 SAMPLE Private: Domestic Company Company 2 (4/5) Business Highlights Description Overview News Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text Extensive Product Portfolio Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text 18

19 Private: Domestic Company Company SAMPLE 2 SWOT Analysis (5/5) S O W T 19

20 Consumer Insights Survey on mobile advertising (-/-) mobile advertising Usage and Preferences Introduction & Methodology Survey on mobile advertising usage and preferences was conducted across multiple social media websites and forums The survey has been kept close ended to capture specific information from the respondents It has been conducted among a small group of people comprising home users, students, salaried professionals and other segments of the workforce The respondents mostly head from various urban and suburban areas of the country Mobile Devices Possession Sample Size Sample Sources Survey Duration Quantitative Representation Used x1 Social Media Websites and Technology Forums z1 Weeks (Month1 Month ) Percentage Q: What type of mobile device(s) do you own? Response Options: 1) R1 2) R2 3) R3 4) R4 5) R5 6) R6 7) R R1 R2 R3 R4 R5 Note: Base is total no. of respondents 20

21 Strategic Recommendations (-/-) Text text text text text text text text text text text text text text text text text Text text text text text text text text text text text text text text text text text Recommendation1 Recommendation2 Text text text text text text text text text text text text text text text text text Text text text text text text text text text text text text text text text Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text Text text text text text text text text text text text text Text text text text text text text text text text text text text text text text text Text text text text text text text text text text text text text text text Text text text text text text text text text text text text text text text text text text text text text text text text text text text text text text Text text text text text text text text text text text text 21

22 Appendix Ratio Operating Margin Calculations (Operating Income/Revenues)*100 Net Margin (Net Profit / Revenues) *100 Profit Before Tax Margin Return on Equity (ROE) Return on Capital (ROCE) (Income Before Tax / Revenues *100 (Net Income / Shareholders Equity)*100 EBIT / (Total Assets Current Liabilities)*100 Return on Working Capital (EBIT / Working Capital) *100 Return on Assets (EBIT / Total Assets)*100 Return on Fixed Assets (EBIT / Fixed Assets) *100 Operating Costs (% of Sales) Administration Costs (% of Sales) (Operating Expenses / Sales) *100 (Administrative Expenses / Sales) *100 Interest Costs (% of Sales) (Interest Expenses / Sales) *100 Ratio Current Ratio Cash Ratio Debt to Equity Debt to Capital Ratio Interest Coverage Ratio Fixed Asset Turnover Asset Turnover Current Asset Turnover Working Capital Turnover Capital Employed Turnover Calculations Current Assets / Current Liabilities {(Cash & Bank Balance + Marketable Securities) / Current Liabilities)} Total Liabilities / Shareholders Equity {Total Debt / (Shareholders Equity + Total Debt)} EBIT / Interest Expense Sales / Fixed Assets Sales / Total Assets Sales / Current Assets Sales / Working Capital Sales / (Shareholders Equity + Total Debt) 22

23 Sources of Information Secondary Research Print Medium Leading Newspapers Telecom and Technology Journals / Magazines Business Magazines Electronic Medium Company Websites Government Websites / Resources Online Telecom Magazines Online Technology and Gadget Journals / Articles Premium Databases Primary Research Interviews Leading Industry Vendors Industry Stakeholders Industry Experts General Consumers Online Social Media 23

24 Thank you for the attention The Mobile Advertising India 2015 report is a part of Netscribes Technology Series. For more detailed information or customized research requirements please contact: Phone: info@netscribes.com About Netscribes Netscribes is a knowledge-consulting and solutions firm with clientele across the globe. The company s expertise spans areas of investment & business research, business & corporate intelligence, content-management services, and knowledge-software services. At its core lies a true value proposition that draws upon a vast knowledge base. Netscribes is a one-stop shop designed to fulfil clients profitability and growth objectives. Disclaimer: This report is published for general information only. Although high standards have been used in the preparation of this report, Netscribes is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes. and prior permission is required for guidelines on reproduction. 24