Presentation on theme: "INVESTMENT OPPORTUNITIES IN INDIA Presented By, SAN Corporate Advisors."— Presentation transcript:
INVESTMENT OPPORTUNITIES IN INDIA Presented By, SAN Corporate Advisors.
GOVERNMENT India is Parliamentary Form of government, governed under the Constitution of India. Indian Democracy is the LARGEST AMONGST All. Democracy is governed by Two level Control i.e Central Level & 2. State Level. Macro Level Financial and Foreign policies are governed by Central Government. India consists of 28 states and seven Union Territories. Almost 80% states speaks local languages. Hindi is National Language & English is Business Language.
DEMOGRAPHY Total Population 1.17 bn (July 2009 est. CIA) Rural Population72.2%, Median age 25.1 years 60% population is between 15 to 60 years. Population growth rate 1.548% (2009 est.) Literacy rate71.7% (Age 7 & above) Percent of the population under the poverty line 22% (2006 est.)
INDIAN ECONOMY The economy of India is the eleventh largest economy in the world by GDP and the fifth largest by purchasing power parity (PPP).eleventh largest GDPfifth largestpurchasing power parity Following strong economic reforms from the socialist inspired economy of a post- independence Indian nation, the country began to develop a fast-paced economic growth, as free market principles were initiated in 1990 for international competition and foreign investment. Economists predict that by 2020, India will be among the leading economies of the world.economyfree market Fixed exchange ratesUSD = 45.6100 INR(September 21, 2010) Fixed exchange ratesUSDINR Fiscal year Calendar year (1 April 31 March) Fiscal year Calendar year
GDP GDP $1.250 trillion (nominal: 11th; 2009) GDP11th $3.526 trillion (PPP: 4th; 2009)GDP growth8.8% (2010, Q1)GDP per capita$1,031 (nominal: 139th; 2009)4th139th
LIST OF COUNTRIES WITH GDP ON THE BASIS OF PUCHASING POWER PARITY (BY IMF) (Fig in US$ Bn) COUNTRY20102011201220132014 EU15046.8815543.84 3.3% 16175.82 4.06% 16854.03 4.2% 17554.03 4.2% US14799.5615397.16 4.04% 16048.20 4.2% 16761.26 4.4% 17490.34 4.4% CHINA9711.7110828.77 11.5% 12101.27 11.75 % 13521.45 11.75 % 15106.65 11.75 % JAPAN4267.504414.48 3.4% 4584.82 3.8% 4755.10 3.8% 4933.50 3.8% INDIA3862.004248.30 10% 4671.51 10% 5144.83 10.12 % 5667.58 10.16 % GERMANY2859.772951.96 3.2% 3064.77 3.8% 3180.25 3.8% 3292.25 3.8% RUSSIA2209.042314.75 4.7% 2443.29 5.5% 2591.27 6.05% 2758.226.5 INDUSTRIAL GROWTH IN % (BY WORLD FACE BOOK) COUNTRYCHINAINDIAUSEUROPEGERMANYRUSSIAJAPAN 200810.76.50.2 126.96.36.199 201012.59.01.50.753.52.5
REGULATORY AGENCIES RBI: (Reserve Bank of India) i. Act as the Central Bank of all Banks of India ii. Controls the monetary policy of the Rupee as well as US$287.37 billion (2009) of currency reserves. iii. FDI is also regulated by RBI. SEBI SEBI controls and regulates Capital Market operations
FDI FACT SHEET From April 2000 to June 2010AMOUNT (In million $) CUMULATIVE AMOUNT OF FDI INFLOWS IN INDIA170,323
Sector-Wise Distribution of FDI Equity Inflow NAME OF INDUSTRY GROWTH RATE% AS ON DEC 2009 POWER3 AUTOMOBILE5.2 METALLURGICAL8.6 PETROLEUM6.2 CHEMICAL12 FINANCIAL8.5 SOFTWARE/HARD WARE 33 TELECOM14 REAL ESTATE11 CONSTRUCTION8.5
INVESTMENT OPPORTUNITIES TO NRI/ FOREIGN NATIONAL ENTITIES SR NO EVALUATION CRITERIA MUTUAL FUND SHARES OF LISTED COMPANIES BUSINESSREAL ESTATES DEPOSITES WITH BANKS 1RESTRICTION ON INVESTMENT *Subject to FDI Rules FREELY PERMITTED* FREELY PERMITTED TO PVT SECTOR * UPTO 100% IN NEARLY ALL SECTORS* FREELY PERMITTED (Large Projects) OTHER THAN AGRICULTURE * FREELY PERMITTED* 2RETURN ON INVESTMENT EQUITY BASE 25-30%,DEBT 10- 15%,DIVIDEN D EXEMP FROM TAX 20-25%, DIVIDEND EXEMP FROM TAX DEPEND ON BUSINESS MODEL, AVG 15-20% 15-20%6-9% 3RISK OF LOSSESEQUITY – HIGH,DEBT- LOW HIGHLOW 4LIQUIDITYHIGH DEPENDS ON BIZ MODEL MEDIUMHIGH 5PROCEDURAL SIMPLICITY YES 6REPATRIATION OF POST TAX INCOME FREE
FOREIGN DIRECT INVESTMENT (FDI) 1.Reserve Bank of India, Apex Bank of India regulates FDI in India. 2.FDI is allowed under automatic route in almost all sectors except a few of national interest. 3.FDI can be brought in via three routes: i. Automatic Route (Without RBI Approval) ii. Approval Route (RBI Approval) iii. Government Approval Route 4 Indian companies can issue equity shares, fully, compulsorily and mandatorily convertible debentures and fully, compulsorily and mandatorily convertible preference shares.
External Commercial Borrowing(ECB) RBI regulates ECB in India Almost all sectors are permitted ECB upto USD 500 Mn ROI is LIBOR based and repayment tenure from 3 years to 10 years. All multinational Banks have presence in India to raise ECB At present RBI Approval is required for ECB. Proposed automatic route.
Indias Investment Opportunities Power - Short Supply of 100000 MW Engineering & Automobiles – Short of Technology Information Technology Banking & Financial Sector Agricultural – Short of Investment in agro processing Infrastructure – Mining, Steel, Oil & Gas, Public Transort, Roads Jewelry & Diamond Processing Aviation Logistics & Transportation Healthcare Education
TO CONCLUDE… Indigenous demand and potential of exports makes it the best investment destination. Indias resources and sincere government efforts assures the success. Economy has passed acid test of recession in last few years showing unparallel success. During 2008-2009 global recession, India posted 7% rise in GDP. Its industrial performance is the main selling point in last few years. India is a country with stable government with deep rooted democracy
TAXATION IN INDIA India has corporate tax rate @ 30% at present and proposed rate @ 25% in new Act. Dividend Tax Rate @ 16.5%. Dividend Exempted in the hands of recipient. India has DTAA with almost all major countries. Direct Tax is now getting computerized. Almost 90% tax departments are now computerised. Presently Indirect Taxes are at multiple level and charged separately. GST is proposed to consolidate major indirect tax under one roof.
WHO WE ARE? SAN Corporate Advisors Provides comprehensive financial services, corporate and investment advisory services primarily to mid-market companies. 1.Due Diligence 2.Tax Advisory 3.Legal Services 4.M & A 5.Accounting & Assurance Services 6.Investment Trustee Services 7.All other business support Services
SUCCESS STORIES Major deals completed in the year 2009: Debt Syndication for a listed public company in the business of manufacturing auto spares –$ 20 Mn Equity and Debt Tie-up for a Healthcare Company – $13 Mn Advisory and funding arrangement on Acquisition of Italian Car Design Company – $ 5 Mn Debt arrangement for an Aluminum Extrusion Company – $ 5 Mn Financial Restructuring & Syndication of Finance for a Sugar, Power and Ethanol Greenfield Project – $ 80 Mn Major deals in progress in the year 2010: Collaboration/Acquisition proposal between India based Company with a company in Germany. Deal size approx. 15 million Euros. Acquisition proposal between Rio Tinto with Jindal Steel Works- $ 150 millions. Strategic alliance and Acquisition of forging units by Listed Company in India. Deal size $ 10 millions. Deals Already completed -- Fund raising for Hospitality project - $ 5 millions from USA based Company.