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For the complete report, get in touch with us at : info@netscribes.com Mobile Commerce is the activity of commencing commercial transactions between both B2C and B2B entities via mobile devices. Indian retail market has experienced high growth over the last decade with a gradual shift towards modern retailing formats. With growing numbers of mobile devices and mammoth wireless subscriber base, the focus is slowly shifting to mobile platforms. Leveraging on enhanced reach like MVAS and diverse features like of e-commerce, m-commerce is poised for greater adoption acrossIndia, in the coming years. Although mobile commerce market inIndiais in nascent stage, m-payment and m-banking segments have shown significant growth over the last few years. Initiative taken by the government and financial organizations to reachIndia’s un-banked population can ensure tremendous growth in the latter segments. There are around 600,000 territories that require banking facilities but only around 89,000 bank branches are there in the country.
Citation preview
Mobile Commerce Market in India
March 2012
Executive Summary
Drivers:
Market
Drivers &
Challenges
�M-commerce market in India will generate around INR x1 bn revenue per annum by 20--
�M-payment services in India are served largely via IVR, SMS-based solutions and mobile apps
�Volume of Mobile banking or m-banking transactions has increased by roughly x2% over 20--,
to reach x3 mn in 20--
Challenges:
� Low Penetration of Advanced Mobile
Devices in Rural Areas
� Low Awareness and Lack of Interest
� Security and Privacy Concern
�Rising Mobile Device Adoption and
Colossal Wireless Subscriber Base
� Increase in Disposable Income and
Economic Advancement
2MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Market Trends
M-Commerce
Player Profile
�Mobile Wallet
�Utility Services
� Financial Services for Rural Consumers
Major Players
CanvasM Technologies Ltd. Geodesic Ltd. JiGrahak Mobility Solutions
One97 Communications Ltd. OnMobile Global Ltd. Oxigen Services Pvt. Ltd.
� Security and Privacy ConcernEconomic Advancement
� Introduction and Availability of Next
Generation Cellular Networks
� Increasing Availability of Credit
•Introduction
•Mobile Commerce Overview
•Drivers & Challenges
•Market Opportunity
3MOBILE COMMERCE MARKET IN INDIA 2012.PPT
�Vendor Opportunities
•Market Trends
•M-Commerce Player Profiles
•Strategic Recommendations
•Appendix
Introduction
Mobile Commerce (M-Commerce) Overview
•Mobile Commerce is the activity of commencing commercial transactions between both B2C and B2B
entities via mobile devices
� It is a part of the broader, e-commerce market which accommodates any commercial transaction via internet
•Increasing tendency to save time and energy, especially amongst the working population will further
intensify the e-Commerce market by a large extent
�Mobile Commerce (m-Commerce) is a segment of Mobile Value Added Services (MVAS)
•MVAS are the services provided by telecom operators directly or indirectly, beyond standard voice calls
Essential Features of M-Commerce System
4MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Source:
Essential Features of M-Commerce System
Mobile Commerce
Feature1
• Ideal_charecteristic1
• Ideal_charecteristic2
• Ideal_charecteristic3
• Ideal_charecteristic4
• Ideal_charecteristic5
Feature3
• Ideal_charecteristic1
• Ideal_charecteristic2
• Ideal_charecteristic3
• Ideal_charecteristic4
• Ideal_charecteristic5
Feature2
• Ideal_charecteristic1
• Ideal_charecteristic2
• Ideal_charecteristic3
• Ideal_charecteristic4
• Ideal_charecteristic5
Retail Ecosystem with M-Commerce
Traditional Retail Supply Chain Modern Retail Supply Chain
Company/
Manufacturer
Company/
Manufacturer
Ba
ck E
nd
Mobile Retail Supply Chain
Company/
Manufacturer
5
Source:
•Traditional retail supply chain comprised of various intermediaries due to which costs increased at every level
•Modern retail supply chain eliminates intermediaries, increases profitability for producers and reduces costs for consumers
•Mobile retail supply chain uses m-commerce company as intermediary with optional role of intermediary1; the product and
services are served to the consumers via platform1, platform2 or platform3
Fro
nt
En
d
ConsumersConsumers
Consumers
MOBILE COMMERCE MARKET IN INDIA 2012.PPT
… m-payment and m-banking have shown significant growth
over the last few years in the domestic market
• Volume of Mobile banking or m-banking transactions has increased by roughly x1% over 20--, to reach x2 mn in 20--
• Penetration of mobile devices running on wireless network in rural areas of the country is still low, standing at around x3-x4% as in the end of 20--
• M-commerce companies are optimistic regarding its growth in India following Reserve Bank of India revising restriction on daily transaction via m-commerce
� Daily mobile transactions limit were increased from INR x5 to INR x6 for money transfers, whereas the limit was raised from INR x7 to INR x8 for goods and services
• Still around x9% of consumers are not aware of the mobile transactions facilities available while z1% consumers, who are aware of m-commerce services, have serious concerns about the security offered by such solutions
• M-commerce is largely leveraging on e-commerce demand across the nation and hence revenue generated by the two
Market Overview – India (-/-)
6MOBILE COMMERCE MARKET IN INDIA 2012.PPT
• M-commerce is largely leveraging on e-commerce demand across the nation and hence revenue generated by the two are often calculated collaboratively
� Market size of e-Commerce is estimated to grow at a dynamic growth rate of z2% to reach INR z3 tr in 20-- from INR z4 tr in 20--
Source:
E-Commerce - Market Size and Growth
0
1
2
3
INR tr
+y2%
Transactions via M-Banking – Growth
0
1,000
2,000+y1%
Major MVAS Delivery Platforms for M-Commerce Services
Delivery PlatformApproximate
CostTrends Applications
XXINR xx/unit
• X% of MVAS services are via Y
• Caters to a wide audience as
services are available even on low-
end handsets
• AAAAAAAAAAAAAAAAAAAAAAA
YY INR X/min
• Strong growth expected due to
mass appeal and ease of usage
• Available in various XX
• BBBBBBBBBBBBBBBBBBBBBBBBBBBBB
7MOBILE COMMERCE MARKET IN INDIA 2012.PPT
ZZINR A/month for
usage
• Directed towards consumers using
technologically advanced handsets
• Growth in X mobile phones is
expected to boost demand
• CCCCCCCCCCCCCCCCCCCCCCCCCCCCCC
AA INR B/ month
• Platform where interaction is in the
form of a continuous session as
opposed to an X
• DDDDDDDDDDDDDDDDDDDDDDD
Source:
• XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
Mobile Commerce Value Chain
AAA BBB CCCC
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Source:
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SDDD
EEE
IIII
GGG
WWW
HHHH
A comparison between the demand and supply side of
m-commerce system
M-Commerce
Platform
M-Commerce Consumers
(Demand Side)
Objectives
M-Commerce Service Providers
(Supply Side)
Objectives
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Platform
Source:
• AAAAAAAAAAAAAA
Requirements
• AAAAAARequirements
• BBBBBBBBBBBBB
SWOT Analysis of M-Commerce Market in India
SWOT
Strengths
• Strength1
• Strength2
• Strength3
• Strength4
Weaknesses
• Weakness1
• Weakness2
• Weakness3
• Weakness4
10
SWOT
Analysis
Opportunities
• Opportunity1
• Opportunity2
• Opportunity3
• Opportunity4
Threats
• Threat1
• Threat2
• Threat3
• Threat4
Source:
MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Drivers & Challenges – Summary
Drivers
Rising Mobile Device Adoption and
Colossal Wireless Subscriber Base
Increase in Disposable Income and
Economic Advancement
Introduction and Availability of Next
Generation Cellular Networks
Increasing Availability of Credit
Challenges
Low Penetration of Advanced Mobile
Devices in Rural Areas
11MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Increasing Availability of Credit
Soaring Enterprise Mobility
Changing Demographics and
Consumer Behaviour
Growing Demand for Rich Digital
Contents
Low Awareness and Lack of Interest
Security and Privacy Concern
Market Opportunity - Potential Verticals (-/-)
• Sector1 consists of segmentx1, segmentx2, segmentx3, segmentx4 and segmentx5
• Market size of the sector can be presented in the combined form of INR x1 tr and x2 mn unit consumption per
annum as of 20--
• MVAS can be implemented by processx1, benefitx1, usagex1 and applicationx1
• Mobile commerce can cater to various services of different verticals
• M-commerce not only ensures enhanced exposure for variety of products but also maximum reach
due to the presence of mammoth wireless subscriber base in the country
Sector1
12MOBILE COMMERCE MARKET IN INDIA 2012.PPT
• Sector1 consists of segmenty1, segmenty2, segmenty3, segmenty4 and segmenty5
• Market size of the sector can be presented in the combined form of INR y1 tr and y2 mn unit consumption per
annum as of 20--
• MVAS can be implemented by processy1, benefity1, usagey1 and applicationy1
• Sector1 consists of segmentz1, segmentz2, segmentz3, segmentz4 and segmentz5
• Market size of the sector can be presented in the combined form of INR z1 tr and z mn unit consumption per
annum as of 20--
• MVAS can be implemented by processz1, benefitz1, usagez1 and applicationz1
Source:
Sector2
Sector3
Vendor Opportunities – Prospective Areas (-/-)
• Area1 hold the third largest share in 20-- as it was worth INR x1 bn and accounted for x2% of the overall e-Commerce
market in India but is predicted to have higher share when it comes to m-commerce
• Advancement in the BFSI sector has resulted in rapid computerization and immense involvement of IT infrastructure
� Modernization and technological development in the sector has led to the emergence of net banking and other online transaction
concepts tremendously
� Currently, all financial organizations and institutions in India support and encourages the use of internet for their day to day operations
� Majority of the nationalized banks in India currently supports online banking which in turn further fuels growth in the market
• The segment is expected to attain a CAGR of x3% to reach INR x4 bn in 20-- from INR x5 bn in 20--
Area1
13MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Source:
0
10
20
30
INR bn
+y1%
Area1 -Growth Area1 -Segments
Area1
Market Trends
Introduction of
Biometrics in
Education
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• bbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbb
• ccccccccccccccccccccccccccccccccccccccccccccccccccccc
Introduction of
Biometrics in
Education
Trend1
Biometric ID Cards
for Public
Transportation
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• bbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbb
• ccccccccccccccccccccccccccccccccccccccccccccccccccccc
Biometric ID Cards
for Public
Transportation
Trend2
14
Source:
Trend4
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• bbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbb
• ccccccccccccccccccccccccccccccccccccccccccccccccccccc
Biometrics
Application in
Customs
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• bbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbbb
• ccccccccccccccccccccccccccccccccccccccccccccccccccccc
Trend3
MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Public: Domestic Company – Company1 (-/-)
Company Information Offices and Centres – India
Corporate Address
Adress line1
Adress line2
City. Country
Tel No. +91- --- - -----
Fax No. ++91- --- - -----
Website www.------.com
Year of Incorporation 19--
Ticker Symbol ------
City Name
Head Office
15
Key People
Products and Services
Stock Exchange Exchange1
Category Products/Services
MVAS Products
• Utility VAS Solution
• M-Commerce Solution
• Mobile App development
• Digital Asset Management
Name Designation
Mr. X Chief Executive Officer
Mr. Y Chief Financial Officer
Mr. Z Chief Operating Officer
Head Office
Source:
MOBILE COMMERCE MARKET IN INDIA 2012.PPT
• The company incurred a net profit of INR a1 mn in FY 20--, as
Public: Domestic Company – Company1 (-/-)
Financial Snapshot Key Ratios
Financial Summary
Net Profit/LossTotal Income
0
50
100
150
0
2
4
6
8
Profit
INR mn
Revenue
INR mn
20--
c4
20--
c3
20--
c2
20--
c1
Particulars y-o-y change
(2011-10)2011 2010 2009 2008
Profitability Ratios
Operating Margin 2.23 0.74% -1.49% -9.59% -10.70%
Net Margin -34.74 -35.26% -0.51% 1.00% -37.12%
Profit Before Tax Margin -53.05 -53.57% -0.51% -25.32% -12.44%
Return on Equity -10.93 -11.06% -0.14% 0.21% -5.79%
Return on Capital Employed 0.18 0.06% -0.12% -0.55% -0.48%
Return on Working Capital 78.72 77.98% -0.74% 0.18% -3.99%
Return on Assets -2.26 -2.29% -0.04% 0.05% -1.56%
Return on Fixed Assets -2.88 -2.94% -0.06% 0.09% -2.98%
Cost Ratios
Operating costs (% of Sales) -2.95 99.22% 102.16% 112.14% 113.76%
16
• The company incurred a net profit of INR a1 mn in FY 20--, as
compared to net profit of INR a2 mn in FY 20--
• The company reported total income of INR a3 mn in FY 20--,
registering an increase of a4 per cent over FY 20--
• The company earned an operating margin of a5 per cent in FY 20--,
an decrease of a6 percentage points over FY 20--
• The company reported debt to equity ratio of a7 in FY 20--, an
increase of a8 per cent over FY 20--
Key Financial Performance Indicators
Indicators Value (--/--/20--)
Market Capitalization (INR mn) 10,985
Total Enterprise Value (INR mn) 87,544
EPS (INR) 48.39
PE Ratio (Absolute) 66.9
Improved DeclineSource:
Operating costs (% of Sales) -2.95 99.22% 102.16% 112.14% 113.76%
Administration costs (% of
Sales)1.04 18.03% 17.00% 15.75% 18.00%
Interest costs (% of Sales) 20.57 63.33% 42.77% 45.59% 29.69%
Liquidity Ratios
Current Ratio -54.82% 0.82 1.81 4.42 7.13
Cash Ratio -96.41% 0.19 5.34 2.99 5.66
Leverage Ratios
Debt to Equity Ratio 45.86% 3.82 2.62 2.92 2.72
Debt to Capital Ratio 6.85% 0.75 0.70 0.72 0.71
Interest Coverage Ratio 124.52% 0.01 -0.05 -0.27 -0.46
Efficiency Ratios
Fixed Asset Turnover -9.25% 0.08 0.09 0.07 0.06
Asset Turnover 18.69% 0.06 0.05 0.04 0.03
Current Asset Turnover 5.19% 0.47 0.45 0.11 0.07
Working Capital Turnover -308.15% -2.08 1.00 0.14 0.08
Capital Employed Turnover 58.09% 0.29 0.19 0.16 0.12
MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Public: Domestic Company – Company1 (-/-)
Key Business Segments Key Geographic Segments
0%
50%
100%
20-- 20-- 20--20--
0%
50%
100%
20-- 20--20--20--
Product1 Product2 Product3 India Outside India
17
Key Information
Description Details
Overview
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Extended Product
Portfolio
• It offers products in the areas of m-commerce, entertainment, media portals and interactive television
programming, mobile marketing, user-generated content and social networking, mobile utility, data and
3G, and information and network through mobile access channels, such as voice, SMS, WAP, USSD, voice,
video, on-device portal, and Web
• Music products comprising Ring Back Tones (RBT), M-radio, reverse RBTs, devotional songs
Source:
MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Private: Domestic Company – Company2 (-/-)
Company Information Offices and Centres – India
Corporate Address
Adress line1
Adress line2
City. Country
Tel No. +91- --- - -----
Fax No. ++91- --- - -----
Website www.------.com
Year of Incorporation 19--
Ticker Symbol ------
City Name
Head Office
18
Key People
Products and Services
Stock Exchange Exchange1
Category Products/Services
MVAS Products
• Infotainment Services
• Mobile Media Contents
• Mobile Voice Solutions
• Call Management Solutions
Head Office
Source:
Name Designation
Mr. XChief Executive Officer and Chief
Operations Officer
Mr. Y President of Sales and Marketing
MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Financial Snapshot Key Ratios
Private: Domestic Company – Company2 (-/-)
Particulars y-o-y change
(2010-09)2011 2010 2009 2008
Profitability Ratios
Operating Margin -5.75 59.76% 65.51% 75.51% 84.64%
Net Margin -0.65 20.94% 21.58% 35.03% 43.42%
Profit Before Tax Margin 4.60 27.02% 22.41% 37.00% 46.07%
Return on Equity -0.44 16.63% 17.07% 44.01% 30.53%
Return on Capital Employed -3.04 57.06% 60.09% 121.39% 108.12%
Return on Working Capital -12.19 22.76% 34.95% 62.37% 51.28%
Return on Assets -0.41 16.59% 16.99% 43.60% 30.45%
Return on Fixed Assets 14.16 93.08% 78.92% 166.10% 98.92%
Cost Ratios
Operating costs (% of Sales) 5.58 36.86% 31.28% 22.96% 11.18%
Profit / Loss
Revenue
2,248,457.8
1,865,274.2
2,467,384.5
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
0
200,000
400,000
600,000
800,000
1,000,000
20102009
Profit
INR mn
Revenue
INR mn
20112008
770,874.4
19
Financial Summary
• The company incurred a net profit of INR 470,723 mn in
FY 2011, as compared to net profit of INR 402,544 mn in
FY 2010
• The company reported total income of INR 2,248,458 mn
in FY 2011, registering an increase of 20.5 per cent over
FY 2010
• The company earned an operating margin of 59.8 per
cent in FY 2011, a decrease of 5.8 percentage points over
FY 2010
Operating costs (% of Sales) 5.58 36.86% 31.28% 22.96% 11.18%
Administration costs (% of
Sales)-3.68 14.87% 18.56% 18.79% 21.10%
Interest costs (% of Sales) -0.01 0.04% 0.05% 0.00% 0.18%
Liquidity Ratios
Current Ratio 19.05% 5.28 4.44 4.10 2.32
Cash Ratio -19.59% 2.29 2.85 1.75 1.04
Leverage Ratios
Debt to Equity Ratio N.A. N.A. N.A. N.A. N.A.
Debt to Capital Ratio N.A. N.A. N.A. N.A. N.A.
Interest Coverage Ratio 25.57% 1791.20 1426.42 #DIV/0! 488.03
Efficiency Ratios
Fixed Asset Turnover 20.70% 4.21 3.49 4.65 2.17
Asset Turnover -0.12% 0.75 0.75 1.22 0.67
Current Asset Turnover -30.24% 0.83 1.20 1.32 0.64
Working Capital Turnover -33.35% 1.03 1.54 1.75 1.13
Capital Employed Turnover -0.31% 0.75 0.75 1.23 0.67
Improved Decline
20102009 20112008
Source:
MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Private: Domestic Company – Company2 (-/-)
Key Information
Description Details
Overview
• Company2 is a mobile media company which offers solutions for discovery, branding and
revenue generation on the mobile platform
• It caters to content destination management, mobile content creation, aggregation and
mobile marketing
20
Extended Product
Portfolio
• It offers M-commerce solutions via SMS including contests, notifications, special offers,
alerts, WAP links, WAP portal development, mobile advertising, and content management
and distribution
• Its MVAS consultancy and support services include concept and ideation for brand
awareness, higher reach, lead generation, engagement, sales, interactivity, targeted
reach, and content delivery
• It also offers mobile online and offline games as direct consumer MVAS product
Source:
MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Strategic Recommendations (-/-)
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Strategic Recommendation1
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21
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Strategic Recommendation2
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Source:
MOBILE COMMERCE MARKET IN INDIA 2012.PPT
Thank you for the attentionThe Mobile Commerce Market in India report is a part of Netscribes’ Telecommunication Series. For more detailed information or customized research requirements please contact:
Kalyan BangaE-Mail: sales@netscribes.com
22MOBILE COMMERCE MARKET IN INDIA 2012.PPT
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