Metals and Mining 2012 - India Brand Equity Foundation

1 1

Metals and Mining

For updated information, please visit www.ibef.org

AUGUST

2012

2 2

Contents

Advantage India

Market overview and trends

Growth drivers

Success stories: CIL, SAIL

Opportunities

Useful information


Metals and Mining AUGUST

2012

3 3

Metals and Mining

For updated information, please visit www.ibef.org ADVANTAGE INDIA

Advantage India

Advantage India

• Rise in infrastructure development and automotive production driving growth in the sector

• Power and cement industries also aiding growth in the metals and mining sector

• There is significant scope for new mining capacities in iron ore, bauxite, and coal

• Untapped metal reserves in India are to the tune of 82 billion tonnes

• India holds a fair advantage in cost of production and conversion costs in steel and alumina

• It’s strategic location enables convenient exports to developed as well as the fast-developing Asian markets

• 100 per cent FDI allowed in the mining sector under the Automatic Route

• Mining lease granted for a long duration of minimum 20 years and up to 30 years

Industry value:

USD305.5 billion

2015F

Industry value:

USD50.8 billion

2005

Source: Datamonitor, Aranca Research Notes: FDI – Foreign Direct Investment

Demand growth Attractive opportunities

Competitive advantage Policy support

AUGUST

2012

4 4

Contents

Advantage India


Growth drivers


Opportunities

Useful information



2012

5 5 For updated information, please visit www.ibef.org MARKET OVERVIEW AND TRENDS

Evolution of the Indian metals and mining sector

• Mining sector received a boost post independence under the impact of successive Five Year Plans

• Central Government promulgated Industrial Policy Resolution

• The exploration of minerals was intensified and the Geological Survey of India was strengthened

• Indian Bureau of Mines was established to look after the scientific development of mineral resources

• Mineral Exploration Corporation established to conduct exploration with focus on coal, iron ore, limestone, dolomite and manganese ore

• India is the largest

producer of sheet mica, the third largest producer of iron ore and the fifth largest producer of bauxite in the world

• Crude steel production in India expanded at a CAGR of 6.8 per cent over 1980-2011

• India accounted for 7.1 per cent of the metals and mining industry in the Asia-Pacific region in 2010

1947

1956

1972

Present

Notes: CAGR – Compound Annual Growth Rate


2012

6 6 For updated information, please visit www.ibef.org

Segments of metals and mining industry

Source: Aranca Research

MARKET OVERVIEW AND TRENDS

Metals and Mining

Iron and steel

Coal

Aluminium

Base metals

Precious metals and minerals

Iron and steel segment offers a product mix which includes hot rolled parallel flange beams and columns rails, plates, coils,

wire rods, and continuously cast products such as billets, blooms, beam, blank, rounds and slab, and metallics and ferro

alloy

Coal market consists of primary coal (anthracite, bituminous and lignite)

Aluminium segment includes alumina chemicals, primary aluminium, aluminium extrusions, aluminium rolled products

Base metal market consists of lead, zinc, copper, nickel and tin

Precious metals market includes gold, silver, platinum, palladium, rhodium, diamond


2012


Strong growth in India’s metals and mining sector over the years

→ India’s metals and mining industry recorded an astounding 30 per cent growth in 2010 to touch USD106.4 billion

→ Much of the above growth in the industry’s value can be attributed to higher prices given that production volume growth was relatively lower at 2.1 per cent (total production stood at 684.4 million metric tonnes)

→ Production volumes have been growing steadily over the years – over 2005-10, it registered a CAGR of 5.7%; with prices also rising during this period, the sector’s value rose by around 16 per cent (CAGR)

Value of India’s metals and mining industry (USD billion)

Source: Datamonitor, Aranca Research


Notes: CAGR – Compound Annual Growth Rate

50.8

59.8 71.7

102.6

81.8

106.4

0

20

40

60

80

100

120

2005 2006 2007 2008 2009 2010


2012

8 8

71.7%

8.3%

7.1%

3.9% 9.0%

China

Japan

India

South Korea

Rest of Asia-Pacific


→ Iron and steel is the largest segment of the Indian metals and mining industry, accounting for 73.8 per cent of the overall industry value (2010); coal is the other major sub-segment with a 20.8 per cent share

→ India accounted for 7.1 per cent of the metals and mining industry in the Asia-Pacific region in 2010

Shares in India’s metals and mining industry (2010)

Source: Datamonitor, Aranca Research


73.8%

20.8%

3.2% 2.0%

0.2% Iron & Steel

Coal

Aluminium

Base Metals

Precious metals &minerals

Iron and steel accounts for a major share in India’s metals and mining sector

India’s share in the metals and mining industry in Asia-Pacific (2010)


2012


Iron ore: Production remains strong

→ India is the world’s fourth largest iron ore producer (global share of 11 per cent)

→ Iron ore production is estimated to have grown at a CAGR of 2.6 per cent between FY07 to FY11; total production in FY11 stood at almost 208 million tonnes

→ In FY11, the share of the private sector in total iron ore production in India was 72 per cent

→ Andhra Pradesh, Chhattisgarh, Goa and Jharkhand accounted for 97 per cent of India’s total iron ore production in FY11

Iron ore production (million tonnes)

Source: Ministry of Mines (Annual Report 2011-12), Aranca Research


187.7

213.3 233.8

218.6 208.0

FY07 FY08 FY09 FY10 FY11


2012


Rising steel demand driving growth in iron ore production

→ Given that iron ore is a key ingredient in steel production, the expansion in iron ore production in India can be linked to the country’s fast-expanding steel sector

→ Crude steel production expanded at a CAGR of 8.0 per cent over 2005-11 to touch 72.2 million metric tonnes

→ India is the fourth largest producer of crude steel in the world (2011) with a global share of 4.8 per cent

Source: World Steel Association, Aranca Research


Shares in global crude steel production (2011)

45.9%

7.2%

5.8%

4.8% 4.6% China

Japan

United States

India

Russia

Crude steel production (million metric tonnes)

45.8 49.5

53.1 57.8

62.8 66.8

72.2

0

10

20

30

40

50

60

70

80

2005 2006 2007 2008 2009 2010 2011


2012


Rising domestic demand puts pressure on supply of iron and steel … (1/2)

→ India is the world’s third largest exporter of iron ore

→ With rising domestic demand-supply gap and to make domestic supplies more attractive, the government on March 2011 hiked freight charges and taxes on iron ore exports

India’s exports of iron and steel (USD billion)

Source: International Trade Centre, Aranca Research


5.2

6.0

8.2

4.4

7.0

0.0

2.0

4.0

6.0

8.0

10.0

2006 2007 2008 2009 2010


2012


Rising domestic demand puts pressure on supply of iron and steel … (2/2)

→ India has turned into a net importer of iron and steel due to strong growth in the manufacturing sector and rising infrastructure projects

→ India’s transition into a net importer of steel despite the strong growth in domestic steel production shows the demand potential of the sector

→ The impact of strong growth in domestic steel

production has been most felt in the iron ore sector; with steel firms’ ever rising demand for the raw material, India’s imports of iron ore has been growing steadily (for example, iron and steel imports increased at a CAGR of 10.6 per cent over 2006-10)

India’s imports of iron and steel (USD billion)

Source: International Trade Centre, Aranca Research


5.6

8.4

10.8

8.5 8.3

0.0

2.0

4.0

6.0

8.0

10.0

12.0

2006 2007 2008 2009 2010


2012


Coal production growing at a steady pace

→ Coal production recorded a CAGR of 8 per cent over FY08-10

→ In the coming years, coal production in the country is likely to receive a boost as the government plans to replace the country’s captive mining policy in coal and iron ore with an open bidding one

Coal production (million tonnes)

Source: Government of India (GOI), Ministry of Coal, Aranca Research

Notes: CAGR – Compound Annual Growth Rate BE – Budget Estimate


457.0

492.8

533.0

572.4

554.0

400

450

500

550

600

FY08 FY09 FY10 FY11BE FY12BE


2012


India’s role in global coal production

→ India is the world’s fourth-largest producer of coal, with the world’s fourth-largest reserves

→ Coal India Ltd (CIL), a Government of India enterprise, is the world’s largest coal company based on raw coal production and coal reserves

Shares in global coal production (2010)

Source: BP - Statistical Review of World Energy 2011, Aranca Research


14.8%

6.3%

48.3%

5.8%

5.0%

19.8% US

Australia

China

India

Indonesia

Rest of the World


2012

15

Source: Geological Survey of India, Indian Bureau of Mines, Aranca Research

Key geological coal and iron ore deposits in India

Coal deposits in million tonnes (mt) Iron ore deposits in million tonnes (mt)

States with major coal deposits

• Jharkhand (76,963 mt)

• Odisha (66,307 mt)

• Chhattisgarh (46,682 mt)

• West Bengal (29,853 mt)

• Andhra Pradesh (22,016 mt)

• Madhya Pradesh (21,988 mt)

• Maharashtra (10,308 mt)

States with lower coal deposits

• Uttar Pradesh (1062 mt)

• Meghalaya (577 mt)

• Assam (387 mt)

• Nagaland (316 mt)

• Bihar (160 mt)

• Sikkim(101 mt)

• Arunachal Pradesh (90 mt)

States with iron ore deposits

• Odisha (44.8 mt)

• Karnataka (34.3 mt)

• Goa (3.7 mt)

• Chhattisgarh (3.4 mt)

• Jharkhand (3.2 mt)

• Andhra Pradesh (0.8 mt)

• Madhya Pradesh (0.3 mt)

• Maharashtra (0.1 mt)


2012

For updated information, please visit www.ibef.org MARKET OVERVIEW AND TRENDS


Major metals and mining players in the country


Segment Major Player Market Share Other players

Iron and Steel NA Sesa Goa, SAIL, Orissa Minerals

Coal 80% Bharat Coking Coal, Reliance Natural Resources, Northern Coalfields

Aluminium 60% National Aluminium Company (NALCO),

Bharat Aluminium Company (BALCO)


2012

17 17 For updated information, please visit www.ibef.org MARKET OVERVIEW AND TRENDS

Notable trends in the metals and mining sector

Captive mining for coal

• In captive mining for coal, companies are permitted to set up coal washeries and for specified end uses, including the setting up of power plants, fertilisers and steel units

• Under the captive route, the government has allocated 198 coal blocks with geological reserves of about 42 billion tonnes to various public and private sector companies

Focus on domestic market

• The demand for metal and metal products is rising in the domestic market with India being a net importer in the metals segment

• In March 2011, freight charges and taxes on iron ore exports were increased to boost domestic supplies

Overseas ventures

• In search of greater mineral opportunities, an increasing number of Indian mining companies are venturing overseas in a bid to secure stable, long-term supplies of minerals especially in the areas of coal and iron ore

• Coal India plans to export 10 MT of coal from Mozambique to India in the next 10 years; the company is seeking more licence blocks in Mozambique

Notes: MT – Metric Tonnes


2012

18 18

Contents

Advantage India


Growth drivers


Opportunities

Useful information



2012

19 19 For updated information, please visit www.ibef.org GROWTH DRIVERS

Strong fundamentals and policy support aiding growth

Policy support

Relaxed FDI norms

Allowing private ownership

Reduced customs duty

Increasing investments

Value of M&A deals in metals

and mining rose at a CAGR of 138

per cent over 2008-11

Increasing FDI

Sustained growth in India’s

automotive sector

Aluminium and coal benefiting from rising

power production

Rising production of cement increasing

demand for coal

Growing infrastructure investments

Inviting Resulting in

Higher demand for metals

Notes: M&A – Mergers and Acquisitions; FDI – Foreign Direct Investment


2012


Power and automotive production fuelling demand … (1/2)

→ Sustained growth in India’s automotive sector has been driving demand for steel and aluminium

→ Automotives production increased at a CAGR of 13.2 per cent over FY05-12

→ Passenger vehicles was the fastest growing segment during this period with a CAGR of 14.5 per cent

→ India is expected to become the world’s seventh-largest automobile market by 2016 and the third largest by 2030

Source : SIAM, Aranca Research Notes: FY – Indian Financial Year (April – March)

GROWTH DRIVERS

Total production of automobiles in India (million units)

1.2

1.3

1.3

1.6

1.8

2.4

3.0

3.1

0.4

0.4

0.5

0.6

0.4

0.6

0.8

0.8

0.4

0.4

0.6

0.5

0.5

0.6

0.8

0.8

6.5

7.6

8.5

8 8.4

10

.5 1

3.4

15

.5

0

3

6

9

12

15

18

FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12

Passenger Vehicle Commercial Vehicle

Three Wheelers Two Wheelers


2012

21 21

617.5 662.5

704.5 723.8 771.6

811.1 876.4

0

200

400

600

800

1000

FY06 FY07 FY08 FY09 FY10 FY11 FY12p


Power and automotive production fuelling demand … (2/2)

→ The power sector accounts for a large share of the consumption of aluminium and coal in the country

→ Power generation in India increased at a CAGR of 6.0 per cent during FY06-12

→ In the Eleventh Plan, India is estimated to have added around 60,000 MW of generation capacity at an investment of USD11.5 billion

→ To meet growing power demand, the Power Ministry has targeted capacity addition of 85,000 MW in the Twelfth Plan (2012-17) period

Source : Central Electricity Authority (CEA), Aranca Research Notes: TWh- Terawatt-hour, p- provisional

GROWTH DRIVERS

Power generation in India (in TWh)


2012


A fast-expanding construction sector has aided growth in metals demand … (1/2)

→ Infrastructure projects continue to provide lucrative business opportunities for steel, zinc and aluminium producers

→ India’s infrastructure sector has grown at a CAGR of 18 per cent over FY08-11

GROWTH DRIVERS

India’s expanding infrastructure industry (USD billion)

Source : Business Monitor International ‘s (BMI) report on infrastructure industry in India, Aranca Research

Note: F – forecasts (by BMI)

37.0 47.4 48.2

60.8 67.8 76.4

92.5

110.6

131.6

156.9

0

30

60

90

120

150

180

FY08 FY09 FY10 FY11 FY12F FY13F FY14F FY15F FY16F FY17F


2012


→ India’s residential and non-residential building industry expanded at a CAGR of 11 per cent over FY08-11

→ Growth in the sector is set to increase in the next few years; forecasts put the CAGR for FY12-17 at 15.4 per cent

→ Iron and steel being a core component of the real estate sector, demand for these metals is set to continue given strong growth expectations for the residential and commercial building industry

GROWTH DRIVERS

Residential and non-residential building industry (USD billion)

Source : Business Monitor International’s (BMI) report on infrastructure industry in India, Aranca Research

Note: F – forecasts (by BMI)

56.3 55.4 68.6 75.3

82.6 95.8

112.3

131.1

153.9

0

40

80

120

160

200

FY09 FY10 FY11 FY12F FY13F FY14F FY15F FY16F FY17F

A fast-expanding construction sector has aided growth in metals demand … (2/2)


2012


Rising cement production – contributor to growing coal demand

→ India is the world’s second-largest producer of cement; the sector’s strong expansion over the past decade has been a key contributor to rising coal demand

→ By FY13, the cement sector is expected to add additional capacity of 92.3 million tonnes

GROWTH DRIVERS

Cement production in India (million tonnes)

Source: CMA, Edelweiss research, Ministry of External Affairs (Govt. of India), Aranca Research

Note: #- first ten months of FY12 i.e. Apr 2011 to Jan 2012

169.5 183.6

201.2

174.3

145.0

0

50

100

150

200

250

FY08 FY09 FY10 FY11 FY12#


2012


Factors behind rising cement production in India

GROWTH DRIVERS

Source: Aranca Research

Higher cement production

Increasing number of houses

Large infrastructure projects

Expanding road construction

Government support


2012


India has a distinct competitive advantage over its peers

→ Within the Asia-Pacific region, India is ahead of South Korea and Philippines in the mining sector; at the same time it is in competition with Australia, Malaysia, China, Indonesia and Japan

Source : India mining report by BMI-Q2 2012, Aranca Research Note: Description of each headline given in the Appendix

GROWTH DRIVERS

Limits of potential returns Risks to realisation of returns

Mining Industry

Country structure

Limits Market risks

Country risk

Risks Mining rating

India 25.0 52.8 34.7 68.5 53.2 60.8 42.6

South Korea 10.0 66.2 29.7 77.7 57.5 67.6 41.0

Japan 12.5 70.8 32.9 86.4 77.9 82.1 47.7

Philippines 17.5 56.2 31.1 60.4 41.5 51.0 37.0


2012


Strong policy support gives metal and mining sector a boost

Notes: FDI – Foreign Direct Investment

GROWTH DRIVERS

Allowing private ownership

• Government of India is encouraging private ownership for steel operations and other high priority industry

Reduced custom duty • Government of India significantly reduced the duty payable on finished steel

products and has streamlined the associated approval process

Relaxed FDI norms

• FDI up to 100 per cent is permitted under the Automatic Route to explore and exploit all non-fuel and non-atomic minerals and process all metals as well as for metallurgy

• FDI caps for coal and lignite has been increased to 100 per cent under the automatic route

Approved NMP • In a positive move for the sector, in 2008, the Indian Cabinet approved the

National Mineral Policy (NMP) 2008, to boost FDI in mining


2012


MMDR bill

GROWTH DRIVERS

Overview of the MMDR bill

• GOI approved the new mining bill – the Mines and Minerals Development Bill (MMDR) – on 30th Sep 2011; the bill calls for mining firms to share either profits or amounts equivalent to royalties with local communities

• The proposed bill is expected to make it easier to win local approval and smoothen the land acquisition process

General restrictions and mineral concessions

Process of revenue collection and usage

• Central government to establish National Mineral Fund; respective state governments to establish State Mineral Fund(s)

• District Mineral Foundation will be set up by the state government which will work for the interest and benefit of persons or families affected by mining related operation in the district and will be managed by a governing council

• The mining tax collected will be spent within the district

• Reservation of areas for PSUs removed

• State governments to set up special courts to expedite prosecution in illegal mining

• Statutory Coordination cum Empowered Committee at central and state levels to decide upon stringent penalties for offences

Notes: GOI – Government of India PSUs – Public Sector Undertakings


2012


Foreign investments flowing in; rise in planned expenditure … (1/2)

→ Cumulative FDI inflows over Apr 2000 – Feb 2012 into the metals and mining sector stood at USD7.3 billion

→ The sector accounted for 4.5 per cent of total cumulative FDI inflows during the period

GROWTH DRIVERS

FDI inflows into metals and mining over Apr 2000 - Feb 2012 (USD million)

Source : Department of Industrial Policy & Promotion, Aranca Research

Notes: FDI – Foreign Direct Investment

6,019.8

940.4 337.3

24.8 0

2,000

4,000

6,000

8,000

MetallurgicalIndustry

Mining Diamond,Gold

Ornaments

CoalProduction


2012


Foreign investments flowing in; rise in planned expenditure … (2/2)

→ Total M&A deal value in metals and mining increased at a CAGR of 138 per cent during 2008-11

→ In 2011, M&A deal value in the mining sector stood at USD11.2 billion, 292 per cent higher than the corresponding figure for 2010 (USD2.9 billion)

GROWTH DRIVERS

Source: Thomson Banker, Deal tracker, Aranca Research

M&A activities (as of May 2012)

Acquirer Target Acquisition Price

(USD million)

Vedanta Resources PLC Cairn India Ltd (30.4% stake in December 2011) 4,541.9

Vedanta Resources PLC Cairn India Ltd (10.1% stake in July 2011) 1,513.2

GVK Power & Infrastructure Ltd Hancock Coal-Queensland Coal 1,260.0

Sesa Goa Ltd Cairn India Ltd 1,175.9

JFE Steel Corp JSW Steel Ltd 1,029.1

Lanco Resources Australia Griffin Coal Mining Co Pty Ltd 722.7


2012

31 31

Contents

Advantage India


Growth drivers


Opportunities

Useful information



2012


Coal India Limited (CIL): Leader in mining industry in India … (1/2)

Notes: CAGR – Compound Annual Growth Rate, MoU – Memorandum of Understanding,

FY – Indian financial year (April – March)

Revenues (USD billion)

SUCCESS STORIES:CIL, SAIL

→ CIL signed an MoU with Ministry of Coal in 2011, wherein CIL targets to produce 461.5 million tonnes of coal

→ CIL also signed an MoU with Shipping Corporation of India in 2010 to create comprehensive end-to-end logistic solutions

Source: Bloomberg, Aranca Research Note: *- 9M of FY12 (Apr 2011- Dec 2011)

6.5

8.1 8.5

9.4

11.0

9.0

0.0

2.0

4.0

6.0

8.0

10.0

12.0

FY07 FY08 FY09 FY10 FY11 FY12*


2012

• Set up in 1967, Coal India Limited (CIL) is the largest coal mining company in India

• Coal India contributes around 85 per cent of total coal production in India


Coal India Limited (CIL): Leader in mining industry in India … (2/2)

Coal Production (in million tonnes)


→ The company's strategic overseas ventures with Colombia and US enabled it to meet India's rising energy demand

→ CIL plans to invest about USD6.25 billion to increase capacity, acquire new mining projects, machineries and equipment

→ Government has recently allocated 116 coal blocks to CIL for expansion

Source: Company Website, Aranca Research Note: *- 9M of FY12 (Apr 2011- Dec 2011)

336.6

353.3

377.2

395.1

390.0

264.2

24.3

26.2

26.5

36.1

41.4

27.1

0 100 200 300 400 500

FY07

FY08

FY09

FY10

FY11

FY12*

Non Coking Coal Coking Coal


2012


Steel Authority of India Ltd (SAIL): A story of steel … (1/2)

Notes: Viswakarma Award is for outstanding achievement or good performance on the part of workers in increasing productivity, quality,

safety, working conditions, import substitution etc

Revenues (USD billion)


→ SAIL has entered into a Joint Venture with POSCO, Korea; Kobe Steel Limited, Japan; Rashtriya Ispat Nigam Ltd; Larsen & Toubro Ltd; National Mineral Development Corporation; Hindustan Prefab Ltd; and IRCON International Limited, Turkey

→ SAIL employees bagged the maximum number of Viswakarma Awards declared in Aug 2009

→ SAIL's expansion plan worth USD15 billion will increase its production capacity from 14 million tonnes per year (current) to 24 million tonnes by 2013

Source: Company website, Aranca Research Note: *- 9M of FY12 (Apr 2011- Dec 2011)

CAGR – Compounded Annual Growth Rate

7.1

8.2 9.0 8.4 8.9

6.7

0

2

4

6

8

10


CAGR 5.9%


2012

• Incorporated in 1954, Steel Authority of India Ltd (SAIL) is India's second largest producer of iron ore


Total saleable steel production (million tonnes)


→ It won the Gold Trophy of “SCOPE Meritorious Award for R&D, Technology Development & Innovation” for 2007-08

→ It was also awarded the “Corporate Social Responsibility & Responsiveness“ by the President of India in FY09

Source: Company website, Aranca Research Note: *- 9M of FY12 (Apr 2011- Dec 2011)

Steel Authority of India Ltd (SAIL): A story of steel … (2/2)

12.6

13.0

12.5 12.6 12.9

9.1

8.0

9.0

10.0

11.0

12.0

13.0

14.0



2012

36 36

Contents

Advantage India


Growth drivers


Opportunities

Useful information



2012


Opportunities

OPPORTUNITIES

Untapped market with strong growth potential

• India’s per capita steel consumption was 55 kg in mid 2011 compared to the global average of 225 kg

• Rural per capita steel consumption is likely to double from its present consumption of 9.7 kg by 2015

• By FY12, a shortfall is expected in domestic supply of steel worth 3-8 million tonnes

Scope for new mining capacities in iron ore, bauxite

and coal

• India has the world’s fifth-largest reserve base of bauxite and fourth-largest base of iron ore respectively, and accounts for about 7 per cent and 10 per cent respectively, of total world production

• India also has the fourth-largest global reserve base of coal, and accounts for 7.5 per cent of the total world production

Rapid growth of user-industries to drive demand for metals

and minerals

• Strong long-term demand from the steel industry is expected to further boost the iron ore industry

• Increasing power production is likely to catapult demand for coal

• Booming construction, automobiles, and packaging industries are expected to lend substantial support to the metals and mining sector

Note: kg - kilograms


2012

38 38

Contents

Advantage India


Growth drivers


Opportunities

Useful information



2012

39 39 For updated information, please visit www.ibef.org USEFUL INFORMATION

Industry Associations

Aluminium Association of India 118, 1st Floor, Ramanashree Arcade 18, M. G. Road Bengaluru, Karnataka-560 001 Phone: 91- 80-25582197, 25582757 Fax: 91-80-25594535 E-mail: [email protected] Federation of Indian Mineral Industries FIMI House, B-311, Okhla Industrial Area Phase-I, New Delhi-110 020 Phone: 91-11- 26814596 Fax: 91-11- 26814593 E-mail: [email protected] Indian Stainless Steel Development Association L -22/4, DLF Phase–II Gurgaon, Haryana-122 002 Phone: 91-124 - 4375501 Fax: 91-124 - 4375509 E-mail: [email protected]


2012


Appendix

BMI’s Mining Business Environment Ratings

• Market structure: it takes into consideration mining output in USD billion, sector value growth, % y-o-y r, mining sector, % of GDP

• Country structure: it takes into consideration labour market infrastructure, physical infrastructure r, tax, and scope of state

• Market risks: it considers metals prices, 5-year, forecast average, metals price forecast, average 5-year growth, regulatory framework, legal framework

• Country risk: it considers, long-term external risk, corruption, bureaucracy , long-term policy continuity

• Mining ratings: it shows the overall scores of the above indicators

USEFUL INFORMATION


2012


Glossary

→ CAGR: Compound Annual Growth Rate

→ FDI: Foreign Direct Investment

→ FY: Indian Financial Year (April to March)

→ So FY10 implies April 2009 to March 2010

→ GOI: Government of India

→ IBM : The Indian Bureau of Mines

→ MoU: Memorandum of Understanding

→ PPP: It could denote two things (mentioned in the presentation accordingly) –

→ Purchasing Power Parity (used in calculating per-capita GDP)

→ Public Private Partnership (a type of joint venture between the public and private sectors)

→ PE: Private Equity

→ USD: US Dollar

→ Conversion rate used: USD1= INR48

→ Wherever applicable, numbers have been rounded off to the nearest whole number

USEFUL INFORMATION


2012

42

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2012

Metals and Mining 2012 - India Brand Equity Foundation

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