Qatar Rail · Appendix A Qatar Rail Civil Engineering Contractors Potential Business Opportunities...

Doc. No.: P000-SPM-EMT-RPT-00003 Rev. 1.0 05/11/13 Printed copy is uncontrolled and only valid at the time of printing. Always refer to the electronic copy as the latest version.

Qatar Rail

Business Opportunities

Information Booklet

Qatar Rail – Business Opportunities Information Booklet

Doc. No.: P000-SPM-EMT-RPT-00003 Rev. 1.0 05/11/13 ii Printed copy is uncontrolled and only valid at the time of printing. Always refer to the electronic copy as the latest version.

Table of contents

1 Introduction ......................................................................................................................... 1

1.1 General ................................................................................................................................................................... 1

1.1.1 Business Opportunity Profiles .............................................................................................................................. 1

1.1.2 Review by Qatar Rail ............................................................................................................................................. 1

1.1.3 Input by Qatar Rail Contractors ........................................................................................................................... 1

1.2 Investment Laws .................................................................................................................................................. 2

Appendices

Appendix A Qatar Rail Civil Engineering Contractors Potential Business Opportunities – Top Priorities

Appendix B McKinsey Report


Doc. No.: P000-SPM-EMT-RPT-00003 Rev. 1.0 05/11/13 1 Printed copy is uncontrolled and only valid at the time of printing. Always refer to the electronic copy as the latest version.

1 Introduction

1.1 General

This booklet provides potential investors with information about the work that has been

done to date by Qatar Rail, its partners, consultants and contractors in relation to future

business opportunities arising from implementation of the Qatar Rail program.

1.1.1 Business Opportunity Profiles

In order to assess the potential for new business opportunities that construction of the

railway program could generate Qatar Rail, in association with its partner Qatar

Development Bank appointed McKinsey & Company to carry out a comprehensive

investigation.

McKinsey reported in July 2012 by issuing a compilation of potential opportunities

complete with information about ease of capture, strategic value and size for each

opportunity across a range of disciplines. The McKinsey & Company report ‘Provision of

Business Analysis Services for Qatar Railways Company’ is contained in Appendix A.

1.1.2 Review by Qatar Rail

In May 2013 a review of the McKinsey report was carried out by Qatar Rail with assistance

from their strategic consultants and project managers. The outcome of the review was to

accept the McKinsey report and to add a number of further opportunities. In addition a

study was carried out to investigate the way in which the opportunities were spread along

the Qatar Rail implementation timeline.

1.1.3 Input by Qatar Rail Contractors

Following a successful procurement process Qatar Rail appointed the first four engineering

contractors whose scope is to design, build and complete the sub-surface parts of the Metro

including tunnels, stations, building services and architectural works. Each of the

contractors was asked to review the opportunities and to advise which ones held a potential

for future investment. They were also asked to indicate five ‘top priorities’ where they

considered the potential for return to be greatest.

The result of the contractors’ consideration and identification of their top priorities is

tabulated in Appendix A. Indicative values have been included where these are known. The

values are generally those that were reported by McKinsey in their report.


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1.2 Investment Laws

The Qatar Ministry of Business and Trade highlights, on their website, a number of

Investment Laws to which foreign investor shall abide. These can be found through the

following link:

http://www.investinqatar.com.qa/English/ForeignInvestor/Pages/Investmentlaws.aspx

The relevant Laws are as follows:

Law No.2 of the year 2005 on the amendment of some provisions of Law No.13 of the year 2000 on Organization of Foreign Capital Investment in the economic activities

Law No.5 of the year 2005 on Protection of Secrets of Trade

Law No.7 of 2002: Law on the protection of copyright and neighbouring rights

Law No.8 of 2002 on Organization of Business of Commercial

Law No.9 of 2002: Law on Trademarks, Commercial Indications, Trade names, Geographical Indications and Industrial Designs

Law No.13 of 2000: Qatar's Investment Law Regulating the investment of foreign capital in economic activities

Law No.30 of the year 2004 Regulating Control of Accounts

Decree Law No.31 of the year 2004 on Amendment of some provisions of Law No.13 of the year 2000 on Organization of Foreign Capital Investment in Economic Activities

http://www.investinqatar.com.qa/English/ForeignInvestor/Pages/Investmentlaws.aspx


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Appendix A

Qatar Rail Civil Engineering Contractors Potential Business Opportunities Top Priorities

Appendix A Qatar Rail Civil Engineering Contractors Potential Business Opportunities Top Priorities

Ref. Potential

Opportunity Description Timeline

Indicative

Value

(US$ millions)

Indicative

Quantity

1. Glass and glazed

elements

Includes all glass elements, for example fenestration, security screens,

platform screen doors, lift and escalator enclosures, feature roofs and

roof lights, Elements providing thermal insulation are also included.

2015 - 2030 40 40,000 m2

2. Metalwork Comprises both architectural and non architectural metalwork, for

example metal panel wall finishes, lift and escalator enclosures,

camouflage doors, cable management systems, balustrade and

handrails, ceiling finishes, ductwork,

2015-2030 30,000 lin. m

3. Cables A wide range of cables including medium voltage, cross linked

polyethylene cables working up to 33kV ac, low voltage cables

operating up to 415V ac and 750 V dc traction power cables.

Conductor element could be copper or aluminium.

Also included are copper rod and bar conductors.

Telecommunication di-electric and aerial cables, fire alarm, control

and low smoke halogen free products.

2014-2030 135 10,000 km

4. Electrical

switchboards

This should include the full range of switchboards located in traction

sub stations and sectioning rooms as well as signaling and station

power supply networks.

2014-2030 150 5,000 units

Ref. Potential


Indicative

Value

(US$ millions)

Indicative

Quantity

5. Fire rated doors Fire rated doors will be used in all front and back of house locations.

There will be a variety of ratings. Standardisation across the system is

a desirable objective.

17,000 units

6. Personal protective

equipment

This includes a range or personal items in the first instance worn by

operatives in the civil engineering discipline. There will be demand for

more specialized items as railway systems installation progresses and

an ongoing demand during the operational and maintenance life of the

railway.

2013-2030 30,000

personnel

7. Energy efficient

lighting

installations and

consumables

Lighting installations and fittings that meet the objectives of energy

efficiency and reasonable systemwide uniformity provide opportunity

for local product and consumable design development and

manufacture.

2015-2030 145 200,000 units

8. Environmental

testing and

commissioning

Environmental testing and commissioning is likely to involve

significant service industry input rather than being goods based. Such

industry is likely to require back up from laboratories and testing

houses.

2015-2030

9. Communications

display equipment

Such display equipment will occur across the network. Some will be

integrated and interlocked with the signaling system. Other

equipment will be less specialized although still forming a part of a

communications system. Equipment is likely to comprise electronic

components, wiring, illumination, display screen and physical

containment

2016-2030 3 5,000 units

Ref. Potential


Indicative

Value

(US$ millions)

Indicative

Quantity

10. Security systems Security systems will be widespread across the Metro involving

supply of a wide range of components, both electronic and physical.

Some systems will protect passengers and front of house activities

whilst others will protect back of house systems, plant and railway

assets.

2015-2030 62 100 stations

11. Lifts, escalators and

travelators

It may be the intention of QR to procure escalators from one of the

leading global suppliers however there is significant opportunity for

some components to be manufactured in Qatar. Also lifts and

associated components may be more open to the local market and so

could present better opportunities

2015-2030 3,000 1,500 units

12. Tunnel ventilation

systems

This includes intake and extract ductwork and louvers, fresh and

exhaust air fans, control panels and possibly chiller equipment 2014-2025 4oo km

13. Drainage and

sewerage

components

A wide variety of components is required comprising castings,

pipework in concrete, cast iron and ceramics. Personnel entry and

inspection shafts with rudimentary and air/gas tight covers are also

included.

2014-2030 15

14. Quality coatings This includes a range of heat applied coatings, for example stove

enameling and powder applied finishes. These cover a wide range of

highly durable finishing applications for the public areas of stations.

2016-2030

15. Internal partition

walls and linings

This includes metal studwork complete with gypsum based paneling

and skim coatings used for a variety of internal partition works in

public and non public areas of stations and other railway buildings

2015-2030 270 7m m2

Ref. Potential


Indicative

Value

(US$ millions)

Indicative

Quantity

16. Specialist lubricants A range of lubricants will be required during the implementation stage

of the project especially in relation to the day to day maintenance of

tunnel drive equipment. There is opportunity for equipment servicing

across the project rather than it being supplied on a contract by

contract basis

2014-2017

17. Plant, lifting

equipment and

consumables

There will be an ongoing demand for this type of equipment on a hire

or buy basis potentially linked with assembly, dismantling operation

and maintenance agreements

2014-2017 550

18. Ceiling and wall

finishes

A wide range of ceiling and wall finishes is anticipated, featuring for

example pressed metalwork, mineral ceilings, cool zone, acoustic

attenuation, integrated lighting, integrated advertising.

2015-2030 80 10m m2

Notes: 1. Timeline relates to all Qatar Rail Development Program projects up to 2030 2. Values and quantities refer to the Qatar Rail Development Program (Metro, LRT and Long Distance) up to 2030


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Appendix B

McKinsey Report

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Provision of Business Analysis

Services for Qatar Railways

Company

CONFIDENTIAL AND PROPRIETARY

Any use of this material without specific permission of McKinsey & Company is strictly prohibited

Business opportunity profiles

Doha, July 31, 2012

McKinsey & Company |

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Contents

▪ Prioritized opportunities

– Infrastructure provision

– Infrastructure operations

– Rolling stock provision

– Transport operations

– Other opportunities

▪ Filtered out opportunities

▪ Appendix – Potential additional opportunities


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Business opportunity Ease of capturing Strategic value

Size of opportunity Other considerations

SOURCE: McKinsey

Project management services 001: INFRASTRUCTURE PROVISION – PM, DESIGN, ENGINEERING & INSPECTION

▪ Initially high capabilities as existing

projects of similar size already carried

out in Qatar. However, JV with

established partner may be needed

on projects requiring previous rail

experience/expertise

▪ Existing suppliers include Astad,

Qatar Project Management

(subsidiary of Barwa), RedCo

International, MICA Qatar, Mazaya

Qatar, and Consolidated Gulf

Company (CGC)

▪ Risk is high, although foreign partner

can mitigate risks where needed

▪ Medium strategic value as

opportunity creates medium-skilled

jobs that can be leveraged on future

projects

▪ Serving a large client may increase

reputation and may facilitate large

contracts in Qatar and the wider GCC

region in the future

▪ Total revenue potential from initial

sales to Qatar Rail: USD ~3.6 bn:

– 2012 to 2020: USD 2.0 bn

– 2021 to 2032: USD 1.6 bn

▪ Additional revenue from project

management services in Qatar and in

the GCC region between 2012-2032

not taken into account

▪ Qatar National Project Management

(QNPM), a planning council initiative

that supports project management in

Qatar’s public service – QNPM can

be leveraged as a partner

▪ In 2009 Qatar Project Management

signed separate 5 year contracts with

both Louis Berger and Hill

International and David Adamson &

Partners Overseas in order to

leverage experienced resources and

build up capabilities

▪ Management of specific construction

projects for part of the rail network,

including the planning, organizing,

directing, and controlling of resources to

ensure project delivery

▪ Likely scenario is for local companies to be

JV partner in metro phase 1, with increased

ownership or leading contractor in phase 2

▪ Key success factors are maintaining the

overall schedule, budget, and quality of all

project elements

▪ Main customers are building and

infrastructure developers, and demand in

the region for project management services

is expected to grow in the near future due

to growth in new constructions

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Maintenance of tunnels 006: INFRASTRUCTURE PROVISION – TUNNEL CONSTRUCTION

▪ Medium feasibility initially as

maintaining tunnels requires

specialised skills which are currently

limited in Qatar

▪ Likely scenario is for local company

to be JV partner in metro phase 1,

with increased ownership or leading

contractor in phase 2

▪ Risk is medium, although foreign

partner can share know-how (during

construction phase)

▪ Low-medium strategic value as it

builds up a degree of specialised

knowledge and creates medium

skilled jobs (structural engineers) in

Qatar that will be required on an

ongoing basis

▪ Knowledge and capabilities can be

applied outside of project within the

GCC region, although amount of

tunnel projects in GCC is expected to

be low

▪ Potential for innovation is low


sales to Qatar Rail: USD ~420mn

– 2012 to 2020: USD 20mn

– 2021 to 2032: USD 400mn

▪ Additional revenue from Qatar and in


is negligible

▪ Provision of preventive and reactive

maintenance of ~80km of metro tunnels

(including minor repairs)

▪ A JV during construction phase may be

required in order for local company to

acquire relevant skills prior to maintenance

work beginning

▪ Attractive opportunity due to long term

recurring revenues ▪ Potential for existing Qatari

companies that maintain roads and

bridges (e.g. Ashghal Roads

Operations & Maintenance, and

Qatar Building Company) to expand

skill set

▪ International companies in Qatar

include Parsons Brinckerhoff (US),

Parsons International (US), and

COWI (DK)

OPPORTUNITY

FOR NEW

BUSINESSES


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SOURCE: McKinsey

Manufacture of pre-fabricated tunnel linings 007: INFRASTRUCTURE PROVISION – TUNNEL CONSTRUCTION

▪ Initially medium feasibility due to

high-precision requirement and a

strategic JV with established

multinational may be required in order

to capture opportunity.

▪ Existing suppliers of concrete

elemnents Qatar include Al Sehmiah,

ACICO, Redco, Khalid Cement

Industries Complex (KCIC), and Gulf

Flag Company WLL

▪ Risk is medium, depending on

involvement of partner

▪ Medium strategic value, as

opportunity builds up specialised

knowledge within manufacturing of

high quality pre-fabricated concrete

elements

▪ Demand for tunnels in Qatar/GCC is

expected to be fairly low but

knowledge can can be applied to

other (more simple) pre-fabricated

concrete elements/structures

▪ Concrete elements are typically not

transported large distances, thus

limited application outside of Qatar


sales to Qatar Rail: USD ~110mm:

– 2012 to 2020: USD 45mn

– 2020 to 2032: USD 65mn

▪ Note that revenues are for full

contract; JV percentage is not

considered

▪ Additional revenue from tunnel

contracts in Qatar and in the GCC

region between 2012-2032 not taken

into account

▪ Consortia will only be allowed to bid

for tunnel contracts if Qatari JV

partner is included

▪ 4 tunnel contracts have already been

tendered out

▪ Potential for combining with provision

of prefab concrete for slab track as

well as more simple prefabricated

elements (e.g. for elevated structures,

platforms, buildings etc.)

▪ Manufacturing of lining elements for ~80km

of metro tunnels, potentially including

delivery to tunnel site

▪ Requires high quality, high precision

precast elements, thus a JV may be the

most suitable option

▪ Construction of tunnel is typically done by

established tunnelling company -

opportunity focuses on supplying the pre-

fabricated concrete elements to main

contractor and capturing value during

construction phase

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Maintenance of bridges/elevated structures 011: INFRASTRUCTURE PROVISION – BRIDGES/ELEVATED STRUCTURES CONSTR.

▪ Medium-high feasibility as

maintenance of bridges and elevated

structures already exists in Qatar

▪ Lead time is long as maintenance

only occurs after construction,

although ramp-up starts early

▪ Risk is medium, although foreign

partner can share know-how (during

construction phase)

▪ Medium strategic value as builds up

specialised knowledge within


structures and creates medium

skilled jobs in Qatar that will be

required on an ongoing basis

▪ Knowledge and capabilities can be

applied outside of project within the

GCC region



sales to Qatar Rail: USD ~1.5bn:

– 2012 to 2020: USD 40mn

– 2021 to 2032: USD 1.5bn



is negligible

▪ Potential for existing Qatari

companies that maintain roads and

bridges (e.g. Ashghal Roads

Operations & Maintenance, and

Qatar Building Company) to expand

skill set

▪ International companies in Qatar

include Parsons Brinckerhoff (US),

Parsons International (US), and

COWI (DK)

▪ Preventive and reactive maintenance of

~100km of bridges and elevated structures

(including minor repairs)

▪ A JV during construction phase may be

required in order for local company to

acquire relevant skills prior to maintenance

work beginning


recurring revenues

OPPORTUNITY

FOR NEW

BUSINESSES


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SOURCE: McKinsey

Construction of bridges/elevated structures 012: INFRASTRUCTURE PROVISION – BRIDGES/ELEVATED STR. CONSTR.

▪ Initially medium feasibility, but JV with

established company required to

capture opportunity

▪ Existing construction companies in

Qatar include Ashghal and Al Jaber

Engineering

▪ Ease of capturing is high as consortia

must include Qatari JV partner.

However, due to complexity, likely

scenario is for local company to be

JV partner in metro phase 1, with

increased ownership in phase 2

▪ Risk is low as consortia includes

established players

▪ Medium-high strategic value, as


knowledge within constructing

bridges and elevated structures,

which can be applied outside of QR

▪ Demand in the region for bridges and

elevated structures is expected to

grow in the near future due to growth

in new developments


sales to Qatar Rail: USD ~850mn:

– 2012 to 2020: USD 270mn

– 2020 to 2032: USD 5800mn

▪ Additional revenue from

bridges/elevated structures contracts

in Qatar and in the GCC region

between 2012-2032 is not taken into

account

▪ Consortia will only be allowed to bid

for bridges/elevated structures

contracts if Qatari JV partner is

included

▪ Can be combined with opportunity for


structures after construction is

complete

▪ Contractor that is overall responsible for

constructing ~100km of bridges/elevated

structures for Qatar Rail, including

– Coordinating the supply of pre-

fabricated elements, rails, and other

components

– Onsite management

– Final assembly/construction

▪ Knowledge and manufacturing capacity is

applicable outside of the rail project,

especially within building construction

▪ Business opportunity focuses on capturing

value from construction phase, with the

potential to apply knowledge in future

bridge/elevated structures projects

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Lead contractor services

▪ Initially high capabilities as existing

projects of similar size already carried

out in Qatar. However, JV with

established partner may be needed

on constructions with complex

designs and/or short timelines

▪ Existing suppliers of construction

management services include Al

Jaber, Redco Group, and Construct

International

▪ Risk is medium, as delay of station

construction could postpone the

operations of the rail system

▪ Medium strategic value as

opportunity creates medium-skilled

jobs that can be leveraged on future

constructions (managing

large/complex constructions for Qatar

Rail will build credibility for future

projects)



– 2012 to 2020: USD 460mn

– 2021 to 2032: USD 380mn

▪ Additional revenue from construction

management services in Qatar and in



▪ Will potentially work together with

construction site logistics company,

unless lead contractor can provide

service in-house

▪ Management of specific construction sites

of the rail network, including the overall

material flow, safety, and management of

sub-contractors to ensure successful

construction completion

▪ Key success factors are maintaining the

overall schedule, budget, and quality of all

construction elements



the region for construction management

services is expected to grow in the near

future due to growth in new constructions

OPPORTUNITY

FOR EXISTING

BUSINESSES

014: INFRASTRUCTURE PROVISION – CIVIL ENGINEERING


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SOURCE: McKinsey

Provision of earth work services 015: INFRASTRUCTURE PROVISION – CIVIL ENGINEERING

▪ High feasibility as earth works is

already done in Qatar and there are

low technical requirements

▪ If the required capacity is available,

opportunity could be captured quickly

▪ Lead time is low as earthworks is the

first phase of building construction

▪ Low strategic value as opportunity

does not create high-skilled jobs

▪ Limited potential for innovation



– 2012 to 2020: USD 570mn

– 2020 to 2032: USD 400mn

▪ Additional revenue from provision of

earth work services in Qatar and in


is not taken into account

▪ Moved earth will be used to construct

New Doha International Airport

▪ On-site provision of earth work services for

buildings, including

– Coordinating the necessary equipment

and machinery

– Excavating the earth and unformed

rock

– Disposing of excavated the materials


value from construction phase, although

service is applicable outside of rail project

in other new constructions

▪ New constructions in the region are

expected to grow in the near future

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Construction of deep foundations 016: INFRASTRUCTURE PROVISION – CIVIL ENGINEERING

▪ High feasibility as provision of deep

foundations is already done in Qatar

and there are low technical

requirements

▪ Lead time is low as provision of deep

foundations is in the early stages of

building construction

▪ Some knowledge can be obtained

from partnering with established

multinational, but limited strategic

value as opportunity does not create

high-skilled jobs

▪ Low potential for innovation



– 2012 to 2020: USD 280mn

– 2020 to 2032: USD 200mn


deep foundations for buildings in

Qatar and in the GCC region between

2012-2032 is not taken into account

▪ Potential to integrate with

manufacturing and trucking of

elements for deep foundations

▪ Construction of deep foundations for

buildings, including

– Coordinating the supply of necessary

equipment, machinery, and materials,

– Driving down prefabricated piles into

the ground using a pile driver to

construct the foundation of the

buildings



deep foundations are applicable outside of

rail project in other new constructions



OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Manufacture of drainage and sewerage components 017: INFRASTRUCTURE PROVISION – CIVIL ENGINEERING

▪ Low strategic value, as opportunity

does not create high skilled jobs or

build up new capabilities

▪ Components can be applied outside

of rail project and can be exported

outside of Qatar

▪ No strong base for competitive

advantage vs. other GCC countries




– 2012 to 2020: USD 10mn

– 2020 to 2032: USD 5mn


manufacturing of drainage and

sewerage components for buildings in



▪ Manufacturing of drainage and sewerage

components for buildings



components are applicable outside of rail

project in other new constructions



▪ High feasibility as drainage and

sewerage components are are

already manufactured in Qatar

▪ If the required capacity is in place,

opportunity could be captured quickly

▪ Lead time is low as earthworks is the

first phase of building construction

▪ Existing suppliers include Pipeline

Supplies & Services Company,

Pipeline Qatar, and Agbizz Al Gazal

Business Solutions

OPPORTUNITY

FOR EXISTING

BUSINESSES


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12



SOURCE: McKinsey

Installation of drainage and sewerage systems 018: INFRASTRUCTURE PROVISION – CIVIL ENGINEERING

▪ High feasibility as installation of

drainage and sewerage systems is

already done in Qatar and there are

low technical requirements

▪ Lead time is low-medium as provision

of drainage and sewerage system

occurs during the early stages of


▪ Some knowledge can be obtained

from partnering with established

multinational, but limited strategic

value as opportunity does not create

high-skilled jobs




– 2012 to 2020: USD 10mn

– 2020 to 2032: USD 10mn

▪ Additional revenue from installation of

drainage and sewerage components

for buildings in Qatar and in the GCC

region between 2012-2032 is not

taken into account

▪ On-site construction of drainage and

sewerage systems for buildings, including

– Coordinating the supply of necessary

equipment, machinery, and materials,

construction of drainage channels, and

– Assembling and installing the

sewerage system







OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Construction of structural frameworks for stations 019: INFRASTRUCTURE PROVISION – CIVIL ENGINEERING

▪ High feasibility as provision of

structural frameworks is already done

in Qatar and there are low technical

requirements

▪ If the required assets and materials

are in place, opportunity could be

captured quickly

▪ Lead time is medium as structural

frameworks for buildings must be

provisioned during the intermediary

phases of building construction






– 2012 to 2020: USD 700mn

– 2020 to 2032: USD 500mn


structural frameworks for buildings in



▪ Potential to integrate with

manufacturing and trucking of

elements for structural framework

▪ On-site construction of the structural

framework for buildings including

– Coordinating availability of necessary

equipment, machinery, and materials

– Final assembly of structural

frameworks



capabilities are applicable outside of rail




OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Construction of inner (non-structural) building divisions 020: INFRASTRUCTURE PROVISION – CIVIL ENGINEERING

▪ High feasibility as provision of inner

divisions for bulidings is already done

in Qatar and there are low technical

requirements



captured quickly

▪ Lead time is medium as internal (non-

structural) divisions for buildings must

be provisioned during the

intermediary phases of building

construction






– 2012 to 2020: USD 160mn

– 2020 to 2032: USD 110mn


inner divisions for buildings in Qatar

and in the GCC region between


▪ Potential to integrate with leasing of

heavy construction equipment and

manufacturing of elements for internal

divisions framework

▪ On-site construction of inner (non-

structural) walls on each floor for buidlings,

including



– Final assembly and installation of

internal divisions







OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Construction of structural frameworks for workshops 021: INFRASTRUCTURE PROVISION – CIVIL ENGINEERING

▪ High feasibility as there are no

special technical requirements



captured quickly

▪ Lead time is medium as structural

frameworks for buildings must be

provisioned during the intermediary

phases of building construction






– 2012 to 2020: USD 30mn

– 2020 to 2032: USD 45mn

▪ Additional revenue from construction

of workshops for rolling stock

maintenance in Qatar and in the GCC


taken into account

▪ Potential to integrate with leasing of

heavy construction equipment and

manufacturing of elements for

structural framework

▪ On-site construction of workshops for

rolling stuck maintenance including



– Final assembly of structural

frameworks


value from construction phase, with the

potential to apply knowledge in future

construction projects in Qatar and in the

region

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Building inspection services (during construction) 022: INFRASTRUCTURE PROVISION – CIVIL ENGINEERING

▪ High feasibility as service is currently

already provided in Doha

▪ Existing suppliers already existing

Shaheen Engineering, Enermes

Engineering, and Confidence

Engineering


does not create additional high-skilled

jobs

▪ Applicable outside of rail project in

other new constructions

▪ Low ability to export service outside

of Qatar



– 2012 to 2020: USD 5mn

– 2020 to 2032: USD 5mn


building inspection services in Qatar



▪ Once construction is complete, there

will be a handover of building

inspection services to station facilities

management company

▪ Inspection of stations and workshops at

each stage of construction (approval

needed prior to beginning work on

subsequent stage)







OPPORTUNITY

FOR EXISTING

BUSINESSES


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Manufacture of pre-fabricated steel grids 024: INFRASTRUCTURE PROVISION – BASIC MATERIALS

▪ Feasible:

– Major input (construction steel)

can be sourced in Qatar – Several smart rebar companies

actually license their software,

including Bamtec from Haussler

Innovation ▪ Initial tests can be run on lower-risk

infrastructure construction, including

stations, platforms

▪ Would require a ramp-up of 9-18

months ▪ Low risk as Qatar rail can fall back on

conventional steel rebar suppliers if

required

▪ Creation of sustainable business in

construction industry with value

added jobs, such as structural

engineers, software engineers

▪ Supports region’s fast-growth

construction sector needs

▪ Potential for steel cluster, including

steel rebar and components

manufacturing

– Opportunity to strengthen/develop

Qatar’s current steel

manufacturing capability

▪ Creates knowledge-based jobs for

expert welders, CAD designers,

quality engineers

▪ Use of advanced software to install pre-

fabricated steel grids that are rolled out on

construction site

▪ Software details exact steel rebar require-

ments, and automates reinforcement bar

bending/cutting production process

– Cuts steel laying time, reduces man-

power requirements and accelerates

the construction programme

▪ Opportunity for Qatari investor buy existing

software, integrate with steel rebar shaping

facility to supply prefabricated steel rebar

onsite

▪ Customers are the contractors appointed

for all concrete structures, including

stations, platforms, slab track and other

buildings

– Additional customers can include

property developers, construction

contractors


SOURCE: http://www.cadsglobal.com/rebarcad_product_information1.html, McKinsey

▪ Large regional construction

companies likely to enter solution

space as well

▪ Typically used for large scale

concrete work, such as bridges or

highways

▪ Only signficant player in Middle East

is Hy-Ten, the licensed partner of

Bamtec for UAE and Oman



sales to Qatar Rail: USD ~25-27mn:

▪ 2012-2020: 12mn – 13mn

▪ 2021-2032: 13mn–14mn

▪ Total revenue potential from sales to

other Qatar companies: USD ~15mn

▪ Total revenue potential from sales

across GCC: USD ~200mn

OPPORTUNITY

FOR NEW

BUSINESSES

See also the separate business

case booklet and brochure for

a detailed business case

of this opportunity

http://www.cadsglobal.com/rebarcad_product_information1.html




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SOURCE: McKinsey

Maintenance of track infrastructure 025: INFRASTRUCTURE PROVISION – RAIL INFRASTRUCTURE CONSTRUCTION


maintaining the rail infrastructure

requires special skills and machinery

which are currently not available in

the country

▪ Potentially entering the market

through JV with established player

(e.g. international construction

company which has a proven

experience in this field) and ramp up

capabilities during first years

▪ Low risk as numerous established

companies can provide service if

required

▪ High strategic value as it is an

ongoing opportunity with highly

skilled jobs

▪ Some potential outside Qatar given

that superstructure has to be

maintained frequently and machinery

can be used across countries, e.g.

grinding, ballast tempering

▪ Potential for innovation is low –

mainly defined by technology built in

at construction phase



– 2012 to 2020: USD 15mn

– 2021 to 2032: USD 270mn




▪ Provision of the scheduled and ad-hoc

maintenance of track infrastructure (slab

track)

▪ Typically the supplier of the rail

infrastructure does the maintenance, and a

JV during supply and installation phase

may be required in order for local company

to acquire relevant skills

▪ Main customer is Qatar Rail, and value is

captured through providing services which

are essential for a fully functional rail

network (metro, light rail as well as heavy

rail)


recurring revenues

▪ Existing suppliers of rail infrastructure

(supply and maintenance) include

Acciona (ES), Bechtel (US), Bilfinger

Berger (DE), Veolia (FR), Vinci (FR),

and Vossloh (DE),

▪ Numerous other mid-sized

companies can also provide service

OPPORTUNITY

FOR NEW

BUSINESSES


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SOURCE: McKinsey

Supply of ballast 026: INFRASTRUCTURE PROVISION – RAIL INFRASTRUCTURE CONSTRUCTION

▪ High feasibility as there are limited


▪ Existing suppliers of stone and

aggregate include Trelco International

Co WLL and Qatar Quarry Company

WLL

▪ Lead time is medium as ballast for

superstructure must be provisioned

during the intermediary phases of




▪ Little potential for innovation



– 2012 to 2020: USD 5mn

– 2020 to 2032: USD 5mn

▪ Additional revenue from supply of

ballast in Qatar and in the GCC


taken into account

▪ Slab track system will be used for

large portions of the network so

demand for ballast is likely to be low

relative to the amount of track

▪ Can potentially integrate with

production of other elements made

from stone

▪ Supply of ballast for relevant (non-slab

track) portions of rail superstructure,

including

– Track

– Depot

– Shunting yards


value from construction phase, with limited

potential to apply knowledge and networks

in future rail projects in Qatar and in the

region

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Standard manufacture of steel rebars and billets 028: INFRASTRUCTURE PROVISION – RAIL INFRASTRUCTURE CONSTRUCTION

▪ Highly feasible:

– Extension of current activities of

domestic steel rebar and billet

manufacturers, but may require

additional investment in capacity

and capabilities

▪ Relatively low risk given Qatar’s

current experience in this area

– Potential for Qatar Rail to source

most steel rebar domestically,

and only import rebar/billets for

riskier slab track and

tunnel/bridge

▪ Current Qatar production of steel

rebar at capacity, requiring imports

▪ Limited strategic value for Qatar

given:

– Domestic steel manufacturing

already exists across GCC

▪ But is a basic material required for

region’s booming construction

industry

▪ Manufacture and supply of steel rebar and

billets used to reinforce concrete

structures, including:

– Slab track

– Bridges

– Tunnel lining

– Station superstructure

▪ Steel rebar is used across all major

constructions in Qatar, with key customers

including property developers and

construction contractors

▪ Potential for additional steel rebar

production to be used for:

– Qatar and GCC construction and civil

works sector

– GCC rail project


sales to Qatar Rail: USD ~2-2.1bn:

– 2012-2020: ~1.3bn

– 2021-2032: 680mn-685mn (only

considers Metro Phase 2, and

not passenger/freight rail)

▪ Additional revenue from other

companies not taken into account

▪ Qatar Steel is regularly importing

steel rebar from Turkey to meet

domestic demand

▪ Construction industry is increasingly

looking for ways to replace steel

rebar with material with superior

strength

to- weight ratio, eg.

– Glass fibre rebar

– Carbon fibre rebar

SOURCE: Expert interview, McKinsey

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Supply of pre-fabricated concrete for slab tracks

▪ Initially medium feasibility due to

high-precision requirement and a

strategic JV with established

multinational may be required in order

to capture opportunity.





Flag Company WLL

▪ Risk is medium, depending on

involvement of partner

▪ Medium strategic value, as


knowledge within manufacturing of

high quality pre-fabricated concrete

elements

▪ Demand for slab track in Qatar/GCC

is expected to be fairly low but

knowledge can can be applied to

other (more simple) pre-fabricated

concrete elements/structures






– 2012 to 2020: USD 200mn

– 2020 to 2032: USD 750mn

▪ Note that revenues are for full

contract; JV percentage is not

considered

▪ Additional revenue from slab track

contracts in Qatar and in the GCC

region between 2012-2032 not taken

into account


of tunnels linings as well as more

simple prefabricated elements (e.g.

for elevated structures, platforms,

buildings etc.)

▪ Manufacture of pre-fabricated concrete for

slab track rail infrastructure, potentially

including delivery to construction sites

▪ Requires high quality, high precision

precast elements, thus a JV may be the

most suitable option

▪ Construction of track infrastructure is

typically done by established construction

companies – opportunity focuses on

supplying the pre-fabricated concrete to

main contractor and capturing value during

construction

OPPORTUNITY

FOR EXISTING

BUSINESSES

029: INFRASTRUCTURE PROVISION – RAIL INFRASTRUCTURE CONSTRUCTION


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SOURCE: McKinsey

Maintenance of electrification 039: INFRASTRUCTURE PROVISION – RAILWAY TECHNOLOGY


maintaining the electrification system

requires special skills and machinery

which are currently not available in

the country


to enter the market through a JV with

established player (e.g. international

construction company which has a

proven experience in this field or

OEM) and ramp up capabilities during

the first few years of maintenance

▪ Risk is high as electrification is key

component of rail but can be

mitigated with experienced partner

▪ Medium strategic value as it creates

high skilled specialised jobs in Qatar

that will be required on an ongoing

basis

▪ Potential to export know-how in GCC

is limited, especially as most railways

today are not electrified (e.g. Saudi

Arabia)

▪ Potential for innovation is low –

mainly defined by technology built in

at construction phase



– 2012 to 2020: USD 10mn

– 2021 to 2032: USD 290mn




▪ Existing suppliers of electrification

(design, supply and maintenance)

include Alstom (FR), Balfour Beatty

(UK), Brecknell Willis (UK), and

Siemens (DE)


maintenance of the electrification system

(incl. third rail)

▪ Typically the railway owner does this in-

house, but can also be subcontracted to

OEMs or third party (in this case a JV

during supply and installation phase may

be required in order for local company to

acquire relevant skills)

▪ Value is captured through providing

services which are essential for a fully

functional rail network (metro, light rail as

well as heavy rail)


recurring revenues and need for company

based in Qatar to provide the service

OPPORTUNITY

FOR NEW

BUSINESSES


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SOURCE: McKinsey

Maintenance of signaling & communication 040: INFRASTRUCTURE PROVISION – RAILWAY TECHNOLOGY

▪ Low feasibility initially as train control

and command system incl. signalling

and communication is a highly

sophisticated system, which requires

specially trained staff


to enter the market through a JV with

established player (e.g. proven

international construction company or

OEM) and ramp up capabilities during

the first few years of maintenance

▪ Risk is high as signalling and comm.

is key component of rail operations

but can be mitigated with experienced

partner



– 2012 to 2020: USD 20mn

– 2021 to 2032: USD 260mn




▪ Existing suppliers of signalling and

communication services include

Alstom (FR), Ansaldo (IT),

Bombardier (CA), GE (US), Invensys

Rail (UK), Siemens (DE), and Thales

(FR)

▪ Medium strategic value as it creates

high skilled specialised jobs in Qatar

that will be required on an ongoing

basis

▪ Potential outside Qatar relevant, but

limited. Often OEMs use technology

which has special requirements, e.g.

a Siemens signalling system cannot

be maintained by a Bombardier team

▪ Potential for innovation is medium –

mainly defined by international

standards, e.g. ETCS


maintenance of the train control, signalling

and communication system

▪ Typically the supplier of signalling and

communication system does the

maintenance, and a JV during supply and

installation phase may be required in order

for local company to acquire relevant skills

▪ Main customer is Qatar Rail, and value is

captured through providing services which

are essential for a fully functional rail

network (metro, light rail as well as heavy

rail)


recurring revenues

OPPORTUNITY

FOR NEW

BUSINESSES


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SOURCE: McKinsey

Manufacture of masts for electrification/signaling 041: INFRASTRUCTURE PROVISION – RAILWAY TECHNOLOGY

▪ High feasibility for wood or concrete

masts, as existing materials and

capabilities already present in Qatar

▪ Existing suppliers of lighting poles,

high mast, and power transmission

towers include Madaeena Al Doha

Lights and Mubarak International Co

WLL

▪ If fiberglass masts are required, a

pultrusion plant would need to be

established as there are currently no

pultrusion plants in Qatar

▪ Low strategic value if masts are made

out of wood or concrete as

opportunity does not create high-

skilled jobs

▪ A pultrusion plant would have

numerous applications outside of rail

(e.g. construction reinforcements,

corrosion-resistant floor mats, and

high strength tunneling components)

and and would have high strategic

value



– 2012 to 2020: USD 1mn

– 2020 to 2032: USD 4mn


ballast in Qatar and in the GCC


taken into account

▪ Provision of masts for electrification and

signaling for long distance rail

▪ The masts can be made out of numerous

materials depending on desired quality and

cost, e.g. wood, concrete, or fiberglass

▪ Opportunity focuses on capturing value

during construction phase

▪ Opportunity to purchase fiberglass

masts (together with fiberglass

protection walls) to support potential

new pultrusion plant

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Construction consulting and logistics 052: INFRASTRUCTURE PROVISION – CONSTRUCTION SUPPORT SERVICES

▪ Initially medium feasibility, as

specialised knowledge with

construction and supply chain

optimisation needs to be obtained

▪ Existing construction optimisation

companies include Davis Langdon,

Balfour Beatty, and Turner, while

existing supply chain optimisation

companies include Agility, DHL, and

CEVA

▪ Risk is high, depending on the

complexity of the project (material

mismanagement and shortages could

lead to construction delays)

▪ Builds up specialised knowledge

within construction site logistics and

material management, which would

create high-skilled jobs

▪ Could facilitate development of long-

term expertise within construction site

logistics and supply chain

management more broadly, which is

highly relevant for construction in

Qatar and the wider GCC region



(TBC):

– 2012 to 2020: USD ~60mn

– 2021 to 2032: USD 40mn

▪ Additional revenue from offering

integrated construction site logistics

services in Qatar and in the GCC


taken into account

▪ Techniques that can be employed to

improve construction operations

include lean construction tools,

performance management systems,

and personalised training plans

▪ Construction consulting and logistics

services covers on-site process

optimisation as well as logistics handled by

main contractor

▪ Value proposition for contractors centres

around lower costs, shorter construction,

capability building, and renewed focus on

core competencies, as current performance

of main contractors shows various

inefficiencies

▪ Construction consulting company is hired

by and works with main contractor, as close

cooperation between the parties is crucial

▪ Construction consulting company is hired

by and works with main contractor –

potential clients exist across a wide range

of construction types, e.g. residential and

commercial buildings, infrastructure

developments, and public institutions

OPPORTUNITY

FOR NEW

BUSINESSES




of this opportunity


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SOURCE: McKinsey, Qatcom.com, ameinfo, Barwa

Labour force support services 053: INFRASTRUCTURE PROVISION – CONSTRUCTION SUPPORT SERVICES

▪ High ease of capturing, even though

size of projects and required services

might be relatively large

▪ Existing players already on the

market in Qatar e.g. Barwa Real

Estate Company and Como Qatar.

▪ Barwa has recently constructed the

world’s largest truck park (Barwa al

Baraha), which can accommodate

4,200 trucks, at a cost of QR500m.

Phase 2 of Barwa al Bahara will

consist of an accommodation camp

for 53,000 workers, at a cost of

QR2.2bn

▪ Low strategic value as the opportunity

creates few high-skilled jobs

▪ Could facilitate development of long-

term expertise within integrated

labour force management and the

corresponding supply of facilities,

which could be exported within Qatar

and to the rest of the GCC region




– 2012 to 2020: USD 50mn

– 2021 to 2032: USD 50mn

▪ Additional revenues from offering

integrated labour force support

services in Qatar and in the GCC


taken into account

▪ Parts of the temporary site services

could potentially be further

outsourced, e.g. provision of medical

facilities, and labour force

transportation to and from sites

▪ Potential to expand into staffing

solutions

▪ QR must ensure that the working and

living conditions of workers are

acceptable (Qatar and the UAE have

previously been criticised in this area)

▪ One-stop solution for labour force support

services for Qatar Rail, including

accommodation, catering, medical facilities,

labour force transportation to and from

construction site, visa processing and

documentation, and other temporary site

services, e.g. prayer rooms and

recreational facilities

▪ Market is currently very fragmented,

potential for consolidation and achieving

economies of scale



the region for labour force support services

is expected to grow in the near future due

to growth in new constructions

OPPORTUNITY

FOR NEW

BUSINESSES




of this opportunity


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SOURCE: McKinsey

Lease of heavy machinery for construction 054: INFRASTRUCTURE PROVISION – CONSTRUCTION SUPPORT SERVICES

▪ High, but requires significant upfront

capital for investment in assets

▪ Existing companies in Qatar include

Qatar Heavy Equipment and Support

Services, Global Enterprises Co, and

MJK Group Gulf Equipment & Hire

▪ Lead time is low as civil engineering

construction takes place during early

phase of construction

▪ Risk is low, assuming on-time

delivery of assets and guaranteed

availability of high quality

maintenance and repair


does not build up high skilled jobs

▪ Assets can be applied outside of

project within the GCC region

▪ Could provide basis for establishing

manufacturing plants of heavy

machinery for construction



– 2012 to 2020: USD 325mn

– 2020 to 2032: USD 225mn

▪ Additional revenue from lease of

heavy machinery in Qatar and in the

GCC region between 2012-2032 is


▪ Potential for innovation within

manufacturing of heavy machinery

electronics (e.g. electronic guidance

and control products)

▪ Opportunity to own and leas out heavy

machinery for construction of rail network

for Qatar Rail, including cranes, bulldozers,

digging equipment/excavators, loaders,

and trucks



heavy machinery is applicable outside of

rail project in other new constructions



OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Lease of construction equipment 055: INFRASTRUCTURE PROVISION – CONSTRUCTION SUPPORT SERVICES

▪ High, but requires some upfront

capital for investment in assets

▪ Existing suppliers include Lulu

Rayyan Trading & Contracting WLL,

Harsco Al Darwish WLL, and Manar

Al Omran

▪ Lead time is low as civil engineering

construction takes place during early

phase of construction

▪ Risk is low, assuming on-time

delivery of assets and guaranteed

availability of high quality

maintenance and repair


does not build up high skilled jobs

▪ Assets can be applied outside of

project within the GCC region

▪ Could provide basis for establishing

manufacturing plants of construction

equipment and light machinery



– 2012 to 2020: USD 45mn

– 2020 to 2032: USD 30mn

▪ Additional revenue from lease of

equipment for construction in Qatar



▪ Opportunity to own and lease equipment

and light machinery for construction of rail

network for Qatar rail, including

shuttering/formwork, scaffolding, concrete

mixers, drills, breakers, and rammers, and

temporary lighting



equipment is applicable outside of rail




OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Materials transportation and heavy trucking 056: INFRASTRUCTURE PROVISION – CONSTRUCTION SUPPORT SERVICES

▪ High, but requires upfront capital for

investment in assets (trucks and

potentially warehouses)


Qatar Heavy Equipment and Support

Services and Al Hasan Transport &

Equipment

▪ Lead time is low as materials

transportation and heavy trucking

begin prior to construction is initiated



▪ Builds up limited knowledge within

owning and managing a fleet of

transport vehicles and trucks

▪ Assets and knowledge can be applied

outside of project within the GCC

region




– 2012 to 2020: USD 45mn

– 2020 to 2032: USD 30mn

▪ Additional revenue from materials

transportation and heavy trucking in



▪ Opportunity to later expand into multi-

modal transport operations and later

integrated supply chain management

and logistics

▪ Potential for innovation within

GPS/track and trace system and

corresponding software

▪ Auxiliary service of freight insurance

and security could also be offered

▪ Logistics to and from construction sites,

including

– Transport of material

– Heavy trucking

– Warehousing where relevant

▪ Knowledge and assets are applicable

outside of the rail project, especially within








OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Manufacture of high performance glass 058: INFRASTRUCTURE PROVISION – BASIC MATERIALS & COMPONENTS

▪ Processing of high performance glass for

stations (windows, facades, and glass

doors), with a focus on tinted glass to

reduce building heat and energy

consumption

▪ Glass sheets will be sourced from existing

float glass plants

▪ The main drivers of demand for high

performance glass are regulation and lower

total cost of ownership for building owners

▪ Main customer will initially be Qatar Rail,

but a significant potential demand exists

outside of the project, primarily in building

windows and facades, where demand is

expected to grow due to new constructions

▪ Qatar has potential cost advantage of

~10% when selling processed glass in local

market, primarily due to lower energy and

transport costs

▪ Medium to high feasibility - existing

players (e.g. Qatar Glass Industries,

Jersey Glass, Dallas Glass, and Zujaj

Company) already on the market for

simple glass, and opportunity for

them to increase their capabilities

▪ New plant with advanced machinery

will need to be established , while

outside expertise will need to be

brought in to build up capabilities and

acquire certification



– 2012 to 2020: USD 20mn

– 2021 to 2032: USD 15mn

▪ Additional revenue from the GCC

region is not included, although

significant potential exists – glass

typically makes up 3-5% of total

building construction costs, of which

90% is high performance glass

▪ Qatar currently imports 70% of its

high performance glass demand

▪ The float glass market is dominated

Note that opportunity does not include

glass for rolling stock as this will be

supplied by OEM and has a

significantly smaller market outside of

rail

▪ High strategic value as there is the

potential for cost-competitive

processing (manufacturing) of glass

with opportunity for driving global

innovation within the industry, which

would create high-skilled jobs in

Qatar

OPPORTUNITY

FOR NEW

BUSINESSES




of this opportunity


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SOURCE: McKinsey

Manufacture of pre-fabricated concrete elements for elevated

structures

▪ Builds up specialised knowledge and

manufacturing capacity within

manufacturing of pre-fabricated

concrete elements, which is

applicable outside of the rail project,

especially within building construction







– 2012 to 2020: USD 1bn

– 2021 to 2032: USD 2.3bn

▪ Additional revenue from prefabricated

concrete elements contracts in Qatar

and in the GCC region between 2012-

2032 is not taken into account


of more complex prefabricated

elements (e.g. for tunnels and slab

track)

▪ Can potentially combine with

opportunity of maintenance of bridges

and elevated structures after

construction is complete

▪ Manufacturing of prefabricated concrete

elements for ~100km of bridges/elevated

structures

▪ Focus on capturing value during

construction phase, as prefabricated

elements are the main costs in bridges and

elevated structures and thus represent

large opportunity

▪ Existing suppliers of concrete can capture

opportunity by upgrading skills to produce

more complex elements



the region for prefabricated concrete

elements is expected to grow in the near


▪ Medium-high feasibility – prefabricated

structures for buildings and simple

beams/columns are already produced

in Qatar





Flag Company WLL

▪ Risk is medium, as quality and on-time

delivery must be ensured

OPPORTUNITY

FOR EXISTING

BUSINESSES

059: INFRASTRUCTURE PROVISION – BASIC MATERIALS & COMPONENTS


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SOURCE: McKinsey

Supply of aggregates 060: INFRASTRUCTURE PROVISION – BASIC MATERIALS & COMPONENTS



▪ Existing suppliers of stone and

aggregate include Trelco International

Co WLL and Qatar Quarry Company

WLL

▪ Lead time is low as aggregates are

used during the initial phases of

construction






– 2012 to 2020: USD 500mn

– 2020 to 2032: USD 350mn


aggregates in Qatar and in the GCC


taken into account

▪ Supply of aggregates for construction of

stations and rail infrastructure



aggregates are applicable outside of rail




OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Supply of liquid concrete




Beton WLL Readymix, Qatar Alpha

Beton Company, and Khalid Cement

Industries Complex WLL

▪ Lead time is low as aggregates are

used during the initial phases of

construction






– 2012 to 2020: USD 300mn

– 2020 to 2032: USD 800mn


liquid concrete in Qatar and in the




of more simple and complex

prefabricated elements (forward

integration of supply chain)

▪ Supply of cement used in

– Tunnel lining

– Bridges, elevated structures, and other

pre-fabricated elements

– Civil engineering structures

– Sleepers

– Potentially for masts and protection

walls



liquid concrete is applicable outside of rail




OPPORTUNITY

FOR EXISTING

BUSINESSES



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SOURCE: McKinsey

Manufacture of pre-fabricated concrete elements for stations

▪ High feasibility – prefabricated

structures for platforms, stairs,

building walls, and simple

beams/columns are already produced

in Qatar.





Flag Company WLL

▪ Risk is medium, as quality and on-

time delivery must be ensured

▪ Low strategic value as most building

elements already produced in Qatar






sales to Qatar Rail: USD 50mn:

– 2012 to 2020: USD 30mn

– 2021 to 2032: USD 20mn


manufacturing of pre-fabricated

concrete elements in Qatar and in the

GCC region between 2012-2032 not

taken into account


of more complex prefabricated

elements (e.g. for elevated

structures/bridges and potentially also

for tunnels and slab track)

▪ Can potentially combine with

opportunity of maintenance of bridges

and elevated structures after

construction is complete

▪ Manufacturing of prefabricated concrete

elements for buildings and stations (e.g.

stairs, platforms, and walls)

▪ Components are already produced in or

imported into Qatar (water, aggregates,

cement through Qatar Nat. Cement Co.)



the region for prefabricated concrete

elements is expected to grow in the near


OPPORTUNITY

FOR EXISTING

BUSINESSES



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SOURCE: McKinsey

Manufacture of standard glass

▪ High, as existing players already

existing, e.g. Qatar Glass industries,

Dallas Glass, Jersey Glass, and Zujaj

Company

▪ Lead time is medium-long as glass is

typically fitted in the latter stages of

production construction



▪ Limited scope for innovation



– 2012 to 2020: USD 2mn

– 2021 to 2032: USD 3mn

▪ Potential revenue from offering

specialized glass or glass for rolling

stock is not considered

▪ Replacement of glass is not

considered

▪ Potential to integrate with provision of

intelligent glass

▪ Provision of standard glass for buildings

and stations (windows, facades, and glass

doors)

▪ Exact amounts and technical specifications

of required glass to be determined once

architectural designs are finalised

OPPORTUNITY

FOR EXISTING

BUSINESSES



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SOURCE: McKinsey

Supply of paint

▪ Medium-high feasibility, depending on

required properties and durability of

desired paint

▪ Existing companies include Silkcoat

Paints, Specialized Coatings WLL,

and German & Qatarian Paints Co

WLL



▪ Limited scope for innovation



– 2012 to 2020: USD 13mn

– 2020 to 2032: USD 9mn


advanced paint types is not taken into

account



is also not taken into account,

although significant potential exists

▪ Provision of paint for

– Rail superstructure

– Exterior finishings of stations

– Interior finishings of stations

▪ Exact amounts and required properties to

be determined once architectural designs

are finalise

OPPORTUNITY

FOR EXISTING

BUSINESSES



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SOURCE: McKinsey

Manufacture of cables

▪ Cable industry moderately

attractive due to high supplier power,

low average profitability

and consolidated industry structure

▪ Five largest players have ~50% of

GCC industry capacity

– Average EBITDA margin ~9%

– Industry driven by cost

▪ Key success factors;

– Manage raw material supply

– Gain scale advantages

▪ Medium strategic value

– Opportunity creates medium-

skilled jobs that can be leveraged

– Demand in the region is

significant and potential for Qatar

to export

– Potential competitive advantage

by leveraging low energy costs

▪ Manufacturing cables with aluminum or

copper

▪ Cables needed in rail infrastructure and

rolling stock, e.g.

– Contact wires

– Catenary wires

– Electricity supply

▪ Cables used in a variety of other industries

e.g.

– Energy building and industry

– Energy infrastructure

– Telecom infrastructure etc.

▪ Cost advantages in case of integration with

aluminum smelter

– Inventory management

– Secured supply of aluminum

– Aluminum supplied in liquid form


▪ Demand for aluminum/copper cables

in Qatar of 33 mn kg in 2012

▪ Cable demand from Qatar rail only

~5% of total demand for cables in

Qatar during construction period

▪ Demand in GCC area ~1 bln kg in

2012

▪ Output of factory: 10,000 MT per year

in steady state

▪ Price: USD 5-8k per ton for aluminum

and USD 10-14k for copper

depending on raw material cost

▪ Total revenue opportunity from sales

to Qatar rail sums up to USD ~135

mn:

– 2012-2020: USD ~60 mn

– 2021-2032: USD ~75 mn

OPPORTUNITY

FOR EXISTING

BUSINESSES



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Strategic value Business opportunity Ease of capturing

SOURCE: McKinsey

Design and supply of energy efficient lighting solutions 068: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY

▪ Qatari entrepreneur has strong local

presence and track record, however

sourcing organization and know-how in

EEL products needs attention

▪ Local network and relationship with all

players in the construction value chain

(including real estate developers,

contractors, architects, MEP’ers) to

become the preferred supplier of EEL

design and sourcing services

▪ Strong sourcing organization and

sourcing strategy to cost effectively

source lamps and luminaires

▪ Marketing of value proposition of EEL

versus traditional lighting

▪ High strategic value for Qatar

– Potential of regional

expansion/champion

– In-line with QNV shift towards

creation of knowledge-based

businesses

– High value creation potential since

specialized services are not yet

provided and potential partnership

with local OEM (e.g. Aamal

company) can deliver significant

synergies

Business opportunity for Qatari entrepreneur

to provide energy efficient lighting solutions

▪ Design and source energy efficient lighting

(EEL) solutions for metro stations, airports,

commercial/residential buildings and for street

lighting

▪ Key customers are developers and main

contractors; other customers are architects,

engineers and MEPs

▪ Value proposition is the provision of an all in

solution for a more attractive product, e.g. EEL

has unique technological features, is financially

more attractive and has enhanced design

characteristics

▪ Business model is to generate income from

design/consulting fees and the mark-up for

sourcing the lamps/luminaires for the customer

▪ Initial revenue for sourcing is ~ USD 42

mn in 2013 and ~USD 2 mn for designing

energy efficient lighting solutions

▪ Revenue is projected to grow to ~USD

145 mn by 2020 for sourcing and ~USD 7

mn for designing with CAGR of ~19%

▪ Revenue drivers are the size of the

project (dependent on number and type

of lamps and complexity of solution),

negotiated design fee and mark-up on

sourcing, EBIT margin remains at ~10%

as business grows

▪ Main suppliers are OEMs that provide

LED (main technology) lamps and

luminaires, key players are Philips, Cree,

Osram, Nichia and Toyoda Gosei

▪ The most relevant substitute for energy

efficient solutions is traditional lighting

solutions, the main service substitute is

that architectural firms will do the design

of (traditional) lighting in-house

▪ Main barrier for entering the market is

building the required network/relations

with all players in the construction value

chain


1 En.lighten: “Draft Regional Report on Efficient Lighting in the Middle East and North Africa “

OPPORTUNITY

FOR NEW

BUSINESSES




of this opportunity


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SOURCE: McKinsey

Provision of advanced advertisement solutions 069: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY

▪ Qatari entrepreneur is well positioned to

successfully enter or expand in digital

signage market but needs to focus on

positioning and pricing

– Local companies already provide

traditional advertisement space and

some are doing some digital signage

in shopping malls

– Local network with media agencies

and directly with government

organizations is strong

– Technical capabilities are present or

easily to build


– Knowledge-intensive industry that

could be leveraged to grow Qatar as

a media hub and spur more IT,

media and entertainment business in

Qatar

– High export potential to current

metros (Dubai, Kuwait City, Mecca),

other countries and new sectors,

e.g., airports, malls, hotels, office

towers

– High innovation potential and high

value added jobs created


to provide advanced solutions for indoor out of

home (OOH) advertisement

▪ Source, install, maintain and operate indoor

digital signage advertisement systems for

metro stations, airports, commercial buildings

and other indoor public areas

▪ Additional opportunity to install more advanced

systems that can personalize content (e.g.

facial recognition, RFID scanning)

▪ Main customers are media agencies and

indirectly advertisers that buy advertisement

space

▪ Value proposition to customers is a lower price

per slot with higher reach and more flexibility in

providing content


selling advertisement space (e.g. selling slots in

packages, pricing dependent on reach)

▪ Projected revenue from digital

advertisement displays in Qatar Rail’s

stations is growing to ~USD 23 mn per

year

▪ Initial revenue in 2016 is ~USD 5.1 mn

projected to grow to ~USD 37 mn by

2030 mainly driven by expanding base

▪ EBIT in “steady state” is ~USD 20 mn

growing with expansion of installed base,

representing a EBIT margin of ~50%

▪ Qatari advertisement spend is very

volatile and currently highly dependent on

government spend, there is a significant

challenge in attracting more

(international) advertisers

▪ Currently there are three players in Qatar

providing digital signage at small scale,

namely Scoop, (Pearl, part of UDC),

LeADers (DIA, part of Al-Attiyah Group),

and Firefly (Villagio)

▪ The main player in Qatar in traditional

OOH is q.media which has +80% of the

market but does not (yet) provide digital

solutions

OPPORTUNITY

FOR NEW

BUSINESSES




of this opportunity


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SOURCE: McKinsey

Utility diversion services 070: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY

▪ High feasibility as service is currently

already provided in Doha, typically by

local sub-contractors



jobs

▪ Applicable outside of rail project in

other new constructions

▪ Low ability to export service outside

of Qatar



– 2012 to 2020: USD 25mn

– 2020 to 2032: USD 15mn


utility diversion services in Qatar and

in the GCC region between 2012-

2032 is not taken into account

▪ Provision of utility diversion services from

main district distribution hubs to building

sites, including connection of both electrical

systems and telecom infrastructure







OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Supply and maintenance of electrical system 071: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY

▪ High feasibility as service currently

already carried out in Qatar

▪ Existing companies include Petrofac

Qatar, Power Links Qatar, Frisco

Facilities Management, Al Ajjaj

Limited Company, Sahel Al Khor

Contracting & Building Maintenance,

Q-tec Group, Hamton International

WLL as well as numerous small

entities






– 2012 to 2020: USD 60mn

– 2020 to 2032: USD 90mn

▪ Additional revenue from installing and

maintaining electrical systems in



▪ Installation and maintenance of electrical

systems for stations and buildings







OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Supply and maintenance of water and plumbing system 072: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY

▪ High feasibility as drainage and

sewerage components are are

already manufactured in Qatar

▪ Existing companies include Frisco

Facilities Management, Sahel Al Khor

Contracting & Building Maintenance,

Electro Mechanical Engineering

Company WLL, Hamton International

WLL, as well as numerous small

entities






– 2012 to 2020: USD 50mn

– 2020 to 2032: USD 70mn


maintaining water and plumbing

systems in Qatar and in the GCC


taken into account

▪ Installation and maintenance of water and

plumbing system for stations and buildings







OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Installation and maintenance of telecom infrastructure 073: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY

▪ High feasibility as service is already

carried out in Qatar

▪ Numerous existing entities exist, e.g.

subcontractors to Qtel that carry out

installation and maintenance of

broadband services in buildings






– 2012 to 2020: USD 20mn

– 2020 to 2032: USD 40mn


maintaining telecom infrastructures in



▪ Installation and maintenance of telecom

infrastructure for stations and buildings







OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Supply and maintenance of escalators and travelators 074: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY

▪ Medium ease of capturing – JV partner

critical

– High end escalators technically

complex, JV partner needed to train

staff and develop skills

– Technical skills and know-how for

repair and maintenance already in

Qatar, but not for assembly

– Independent Qatari player not

competitive against global OEMs

– Low risk since stations still useable

without functioning escalators


– Contributes to deepening the

manufacturing and assembly

capabilities by local sourcing of steel

and aluminium inputs

– Import substitution by locating parts

of the value chain in Qatar (e.g.

assembly)

– Build-up additional capabilities for

ongoing maintenance demand

▪ Formation of JV partnership with the OEM

– JV to do local assembly and source parts of

low complexity from Qatar (e.g., consoles,

steps) while advanced parts, (e.g., motor

and electrics) are sourced from abroad

– Maintenance and installation

– To be determined how “Qatar Rail

consortia contract for systems” impacts

setup of joint venture, especially if and

when company supplies customers outside

of QR

▪ Main revenue streams;

– New equipment sales and installation

– Service and maintenance contracts

▪ Key costs include costs of components and

worker salaries

▪ Value proposition to offer high quality escalators

at a lower cost enabled by

– Local sourcing of parts, e.g. lower costs

(TBD)

– Lower margins

▪ QR demand significant in relation to

demand from other Qatari sources

▪ High revenue opportunity from sales to

Qatar Rail project

– 2012-2020: USD ~350 mn

– 2021-2032: USD ~270 mn

▪ Annual market in the Qatar in 2012 of

USD ~4 mn, growing with ~5% p.a.

▪ Annual market in the GCC in 2012 of

USD ~46 mn, growing with ~5% p.a.

▪ Consolidated industry landscape (80% of

market covered by top 5 OEMs)

▪ Industry leaders; Otis (US), Schindler

(CH), Thyssen-Krupp (D) and Kone (FI)

▪ Potential Qatari firms Almuftah Elevators

& Escalators, Choice Elevators &

Escalators, Electromec Technical

Associates

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Supply and maintenance of lifts 075: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY

▪ Medium ease of capturing

– Currently no skills in elevator assembly

– JV partnering with leading OEM

increases feasibility as knowledge and

experience are leveraged

– Main challenges include managing the

supply chain locally in Qatar as well as

having cost efficient parts assembly

– Added value of doing local assembly to

be determined

– Medium risk since stations still useable

without functioning lifts


– Contributes to deepening the

manufacturing and assembly capabilities

by local sourcing of steel and aluminium

inputs

– Import substitution by locating parts of

the value chain in Qatar (e.g. assembly)

– Build-up additional capabilities for

ongoing maintenance demand


– Set-up of local assembly capability for parts of

low complexity e.g., cabin structure and interior

while advanced parts, e.g., motor and electrics

are sourced from abroad

– Local installation and maintenance in Qatar

– To be determined how “Qatar Rail consortia

contract for systems” impacts setup of joint

venture, especially if and when company

supplies customers outside of QR

▪ Main revenue streams

– New equipment sales and installation

– Service and maintenance contracts

▪ Key costs include costs of components e.g., motor,

electric system, railings, and consoles and worker

salaries

▪ Value proposition to offer high quality lifts at a lower

cost enabled by

– JV with strong international player

– Local sourcing of steel sheets (Qatar steel)

– Local assembly on scale

– Lower installation and maintenance costs due to

lower wages

▪ Key success factor to offer total package includ-ing

local assembly, installation and full servicing

▪ Total revenue opportunity from sales to Qatar

rail sums up to USD ~77 mn:

– 2012-2020: USD ~49 mn

– 2021-2032: USD ~28 mn

▪ Addressable market between 2012-2032 of

USD ~94 mn in Qatar (excl. QR) growing with

~5% p.a.

▪ Addressable market between 2012-2032 of

USD ~171 mn in GCC region growing with

~5% p.a.

▪ Sizing based on number of elevators for

metro phase 1, costs per elevator and share

of value chain captured (e.g. not

manufacturing

▪ Concentrated industry with top four players

Otis (US), Schindler (CH), Thyssen-Krupp (D)

and Kone (FI) accounting for 60% of the

EMEA market

▪ Potential Qatari players to take part are

Almuftah Elevators & Escalators, Choice

Elevators & Escalators, Electromec Technical

Associates

▪ EBIT margin on new equipment sales ~5%,

maintenance ~25%

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Supply and maintenance of HVAC 076: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY

▪ High ease of capturing since many

companies are already providing

services, e.g.

– EMCO Qatar

– MP Qatar Trading W.L.L.

– Al Malki Group of Companies

– AG Group

– Al Ajjaj Limited Company

– Consolidated Gulf Co (CGC)

– Delwan Qatar WLL

– Earth Smart Co WLL

▪ Low risk for hampering development

of metro/rail network

▪ No commercial risk for current

businesses


– Potential for exports to other

GCC countries

– No creation of knowledge

intensive jobs


due to relatively low labor costs

in Qatar

▪ Supply and maintenance of HVAC units

including ducting

▪ HVAC is needed in stations for Qatar Rail

and in many other buildings like

– Shopping malls

– Residential buildings

– Hotels

– Airports

– Bus stations

– Etc.

▪ Huge opportunity given climate and

growing population

▪ Customers comprise mainly of

construction companies

▪ Value proposition in cost advantage due to

scale



to Qatar rail sums up to USD ~50 mn:

– 2012-2020: USD ~10 mn

– 2021-2032: USD ~40 mn

▪ N/A

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Supply and maintenance of telecom devices 077: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY



services, e.g

– Moseco Qatar

– Qatar Communication CO

– Etisalat

– DU

– Etc.




businesses

▪ Low strategic value due to Qatar Rail

project

– No additional exports

– No creation of knowledge

intensive jobs

– No competitive advantage due to

relatively low labor costs in Qatar

▪ Supply and maintenance of telecom

devices for employees of Qatar rail and

related companies

– Installation of fixed phone lines

– Provision of mobile phones

– Provision of mobile contracts

– Maintenance and replacement of fixed

and mobile phones

▪ Main customer is Qatar Rail and

contractors, retail stores etc.

▪ Value proposition is delivering high quality

telecom solutions at good price


▪ N/A ▪ Total revenue opportunity from sales


– 2012-2020: USD ~0.5 mn

– 2021-2032: USD ~0.5 mn

▪ Revenue potential small due to low

number of employees in stations

OPPORTUNITY

FOR EXISTING

BUSINESSES

http://de.wikipedia.org/w/index.php?title=Datei:Modernes_Telefon.jpg&filetimestamp=20120312194734


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SOURCE: McKinsey

Supply and maintenance of fire safety systems



services, e.g

– Dafoos Fire & Security Systems

WLL

– Ishield Security and Safety

Solutions

– Phoenix International WLL

– Al Alf Fire Protection Services

– Balance Automation &

Electromechanical Systems

▪ Medium risk for hampering

development of metro/rail network

(safety extremely important)



GCC countries (rapidly growing

population and economy and

therefore construction)

– Possible creation of knowledge

intensive jobs (improving

systems, create integrated

solutions)



in Qatar

▪ Supply and maintenance of fire safety

equipment for stations and buildings

– Sprinkler system

– Fire extinguishers

– Fire alarm

– Emergency protocols

▪ Regular monitoring of fire safety systems

▪ Potentially training on emergency

procedures for local staff

▪ Main customers are

– Qatar Rail

– Construction companies (hotels,

shopping malls, airport, residential

buildings etc.)

▪ Value proposition around low cost due to

scale and high quality and low

maintenance




– 2012-2020: USD ~2 mn

– 2021-2032: USD ~21 mn

▪ N/A

078: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY OPPORTUNITY

FOR EXISTING

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SOURCE: McKinsey

Supply and maintenance of CCTV



services, e.g.

– Adax Business System WLL

– AG Group

– Al Saher Communication

Security and Trading Co WLL

– BRILTEC

– Dafoos Fire & Security Systems

WLL



(safety extremely important)


businesses






– Possible creation of knowledge

intensive jobs (improving

systems, create integrated

solutions)



in Qatar

▪ Supply and maintenance of CCTV systems

for stations and buildings

– Camera’s

– Wiring

– Monitoring

– Etc.


– Qatar Rail for stations

– Airport

– Hotels

– Residential buildings

– Shopping malls

– High security places (e.g. banks)


scale and high quality and low

maintenance




– 2012-2020: USD ~34 mn

– 2021-2032: USD ~28 mn

▪ N/A


FOR EXISTING

BUSINESSES


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Supply and maintenance of platform screen doors 080: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY


– Local players in this space include

Al-Bawali Group and Al-Mufta

Automatic doors

– High technical complexity and short

development time motivates need for

JV partner

– High criticality to rail operations

▪ Success depends strongly on ability to

grow business outside of QR

– Expansion of service business to

current metros (e.g., Dubai, Cairo)

– Expansion of service business to

new metros (e.g., Damascus,

Jeddah)

– Expansion into other types of

buildings (e.g.

▪ Medium strategic value, hinges on export

performance

– Build-up of more advanced

assembly capabilities

– Value created by replacing imports

with domestic supply thus retaining

profits in Qatar

– Potential to scale business

geographically (e.g., Dubai), into

adjacent segments (e.g., airports)

and into standard screen doors to

gain scale

– Creates demand for locally sourced

steel and glass inputs


– Set up of local parts assembly, installation

and maintenance of automated platform

screen doors

– Key parts to be sourced locally include

glass (40% of cost1, usually done locally)

for screen doors and steel and aluminum

components, more complex inputs to be

sourced from abroad

– To be determined how “Qatar Rail

consortia contract for systems” impacts

setup of joint venture, especially if and

when company supplies customers

outside of QR

▪ Value proposition to offer high quality doors at

a lower cost by leveraging cheap supply of key

input materials and do local assembly

▪ Key customers are public transportation, e.g.,

metro systems

▪ Main costs are pre-manufactured components

and worker salaries

▪ Annual revenue in QR opportunity of

USD ~10 mn mainly driven by new

equipment sales

▪ Total opportunity from sales to Qatar rail

USD ~170 mn

– 2012-2020: USD ~70 mn

– 2021-2032: USD ~100 mn

▪ Westinghouse Platform Screen Doors

(UK) top player, supplying e.g., Dubai

metro and London Underground

▪ Other key suppliers include:

– Manusa (Spain) – USD 40 mn

revenue

– Oclap (Italy) – USD 12 mn revenue


SOURCE: McKinsey

1 Material and labor

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Supply and maintenance of sliding doors for stations/ buildings



services, e.g.

– Falcon Automatic Door System

– Abdulla Al Mulla Trading

Company

– DOHA UPVC Windows And

Doors

– Al Baqali Automatic Doors

– Jersey Glass


of metro/rail network, alternatives

available


businesses






– Low potential for creating high

skilled jobs



in Qatar ▪ Supply and maintenance of screen doors

systems for stations (excl. platforms) and

other buildings

– Assembly

– Installation

– Maintenance

▪ Type of products

– Sliding doors

– Revolving doors

– Etc.


– Qatar Rail for stations

– Airport

– Hotels

– Residential buildings (entrance)

– Shopping malls (entrance)


scale




– 2012-2020: USD ~6 mn

– 2021-2032: USD ~10 mn

▪ N/A


FOR EXISTING

BUSINESSES


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Supply and maintenance of standard advertisement equipment



services, e.g.

– Click Printing

– Adax Business Systems WLLL

– Ayyam Marketing & Advertising

Solutions

– Blink

– Control P Seventh Spectrum

Trading

– 5PS Marketing and Advertising

– Almuftah Design & Concept





GCC countries: rapidly growing


therefore growing number of

stations/airports/shopping malls

– Low potential for creating high

skilled jobs



in Qatar

▪ Supply and maintenance of standard

advertisement components, excluding

exploitation of equipment

▪ Type of products

– Displays

– Banners

– Placards

– Billboards


– Qatar Rail

– Airports

– Shopping malls

– Events


scale, integrated offering across all

stations




– 2012-2020: USD ~1 mn

– 2021-2032: USD ~10 mn

▪ N/A



FOR EXISTING

BUSINESSES


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Supply and maintenance of audio and communication systems

▪ Medium ease of capturing since some


services, e.g.

– Fontas Electronics & Services

– ADAX business systems




– Potential for exports to other GCC

countries: rapidly growing



stations/airports/shopping malls

– Medium potential for creating high

skilled jobs (e.g. designing higher

quality, integrated solutions)


due to relatively low energy and

labor costs in Qatar

▪ Supply and maintenance of audio and

communication systems

▪ Type of products include

– Intercoms in stations (excluding rolling

stock)

– PA systems (excluding rolling stock)

– Information screens (e.g.

arrival/departure/transfer, route and

stations planning information)

▪ Main customers include

– Qatar Rail

– Airports

– Shopping malls

– Ferry stations (if build in future)




– 2012-2020: USD ~1.5 mn

– 2021-2032: USD ~1.5 mn

▪ N/A



FOR EXISTING

BUSINESSES


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Supply and maintenance of lighting



services, e.g.

– Ashghal

– Avtech (audio visual technology)

– Asif Lighting Equipment - Dubai

Airfield Lighting Division

– Lightbox International

– Al Saleh Electric Materials

– Alaa Industrial Equipment Factory

– Benchmark Trading & Engineering

Services WLL

– Nabina Mirrors & Lighting Centre




– Potential for exports to other GCC

countries: rapidly growing



buildings and outside areas that

need to be illuminated

– Medium potential for creating high

skilled jobs (e.g. designing higher

quality, integrated solutions,

facilitating transition to LED/CFL)


due to relatively low energy and

labor costs in Qatar

▪ Supply and maintenance of all lighting

equipment

▪ Mainly for general lighting (ambient lighting)

purposed, possible accent lighting

(decorative)

▪ Products include

– Incandescent light bulbs

▫ Halogen (high pressure, halogen

gases)

▫ Xenon

– Fluorescent (tube, phosphor)

– Neon

– LED

– CFL (compact fluorescent lamps)

– Cold cathode fluorescent lamps (CCFL)

▪ Customers include Qatar Rail, airports,

shopping malls, residential/commercial

buildings, municipalities (street lighting)




– 2012-2020: USD ~5 mn

– 2021-2032: USD ~31 mn

▪ N/A



FOR EXISTING

BUSINESSES


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Installation of toilet facilities

▪ Installation of toilet facilities in stations and

buildings, including integrating with waste

and sanitation plumbing system

▪ Toilets would likely be procured from

international toilet/ceramic manufacturers,

eg. Caroma, Gerber, Kohler or American

Standard – and installed locally onsite

▪ Value proposition driven by ability to

identify and source right toilet meeting

architectural and interior design

specification within the specified delivery

deadlines for final installation



085: INFRASTRUCTURE PROVISION – BUILDING TECHNOLOGY



– 2012-2020: USD ~1 mn

– 2021-2032: USD ~1 mn

▪ Several Qatari companies already in

this space, and opportunity can be

captured by local MEP contractor

▪ Does not put the Qatar Rail project at

risk – but will impact on customer

experience

▪ Low

– Does not create some

knowledge-based jobs

– Is required as a basic service for

the country

▪ Can be included within the main

contractor’s contract – and so would

not be procured by Qatar Rail

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Interior design services

▪ Several Qatari businesses are

already active in this space, including

Qatar Design Consortium, Vandome

Trading, Vasco Trading & Contracting

– But limited experience in interior

design for urban transport

stations



experience

▪ Provision of interior design services for

stations and other buildings

▪ Responsible for interior space composition

and design, including selection of all

customer-facing materials and objects,

including wall claddings, floor tiles/carpets,

ceiling elements, furnishings

▪ Also responsible for selection and lay-out

of acoustics and lighting technologies

▪ Value proposition driven by ability to foster

right “customer experience” (convenience

and look and feel), within budget

▪ Revenue typically based on the value of

the total project or on man-hours required





▪ Qatar Rail may consider requiring

certain percentage of

materials/objects used for interior

design are procured locally


097: INFRASTRUCTURE PROVISION – INTERIOR FINISHINGS

▪ Medium to high:

– Supports region’s booming

construction industry

– Creates knowledge-based jobs



– 2012-2020: USD ~32 mn

– 2021-2032: USD ~10 mn

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Supply of wall and floor tiles



Decoration World WLL, Rafco, Jersey

Group, each with strong ties with

several international suppliers of wall

and floor tiles



experience

▪ Supply of wall and floor tiles, for station

interiors as well as other buildings within

guidelines specified by interior design and

architectural blueprint

▪ Materials also need to comply with safety

standards set by Qatar Rail and Qatar

government regulators

▪ May involve procuring and

assembling/integrating different materials


identify and source right material from

suppliers within the specified delivery





▪ Medium



– Creates few knowledge-based

jobs

– Creates few jobs (~10-30 FTEs)

and is relatively small business

opportunity




▪ May also be responsible for onsite

delivery and installation



– 2012-2020: USD ~40 mn

– 2021-2032: USD ~30 mn

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Supply of ceiling elements





already active in this space,

Decoration World WLL, QaProfile,

Jersey Group, Robust Qatar, each

with strong ties with several

international suppliers of ceiling

elements



experience ▪ Supply of ceiling elements for station

interiors as well as other buildings within

guidelines specified by interior design and

architectural blueprint










▪ Medium




jobs



opportunity








– 2012-2020: USD ~8 mn

– 2021-2032: USD ~2 mn

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Supply of wall sheathing elements






Jersey Group, each with strong ties

with several international suppliers


risk

▪ Supply of wall sheathing for station

exteriors as well as other buildings within

guidelines specified in the architectural

blueprint

▪ Wall sheathing is first layer of covering on

an exterior wall, fastened to the wall studs,

and is primarily used within exterior walls

as insulation and weather/water-proofing















▪ Medium




jobs



opportunity



– 2012-2020: USD ~15 mn

– 2021-2032: USD ~10 mn

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Installation of tiles, ceiling elements and wall sheathing elements






Jersey Group, each with strong ties

with several international suppliers



experience

▪ Final installation of tiles, ceiling elements

and wall sheathing elements on site

▪ Limited to final installation – and so does

not involve any design, manufacturing or

procurement of the material

▪ Key success driver is logistical alignment

with multiple suppliers and site

contractor/project management to ensure

installation on time and as required ▪ Would likely be included by the

suppliers of the tiles, ceiling elements

and wall sheathing elements – and so

would not be procured by Qatar Rail

▪ Low



– Creates no knowledge-based

jobs



– 2012-2020: USD ~15 mn

– 2021-2032: USD ~10 mn

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Manufacture of non electric doors


this space, including Al Einkaz

Trading & Industry, Alma Aluminum

and Steel Company, Folda Qatar,

Ghanim bin Saad & Sons


risk

▪ Low



– Creates no knowledge-based jobs




▪ Manufacturing of doors from stainless steel,

aluminum, glass and other materials

revolving doors for stations and other

buildings, including:

– Normal doors

– Revolving doors

– Sliding doors

▪ Key success driver is sourcing quality

materials, cost management and reliability ▪ Can be included within the main







– 2012-2020: USD ~2 mn

– 2021-2032: USD ~2 mn

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Installation of non-electric doors

▪ Installation of doors from stainless steel,

aluminum, glass and other materials

revolving doors for stations and other

buildings, including:

– Normal doors

– Revolving doors

– Sliding doors

▪ Key success driver is ensuring speed and

reliability of installation





this space, including Al Einkaz

Trading & Industry, Alma Aluminum

and Steel Company, Folda Qatar,

Ghanim bin Saad & Sons


risk

▪ Low











– 2012-2020: USD ~0.5 mn

– 2021-2032: USD ~0.5 mn

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Interior and exterior painting services


this space, including National Paints

Factory and Joutun Paints



experience

▪ Painting of exterior walls and interior walls

and ceilings in stations and other buildings

in alignment with interior designer

specifications

▪ Paints can be manufactured locally or

procured internationally depending on the

exact technical requirements

▪ Paint used will need to comply with safety



▪ Key success driver is ensuring speed and

reliability of installation




▪ Low









– 2012-2020: USD ~10 mn

– 2021-2032: USD ~5 mn

OPPORTUNITY

FOR EXISTING

BUSINESSES


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SOURCE: McKinsey

Manufacture of wall lining systems 106: INFRASTRUCTURE PROVISION – EXTERIOR FINISHINGS

▪ Medium feasibility – input factors can

be sourced locally or within GCC at

extremely competitive costs

▪ Know-how within interior lining R&D

and testing will need to be built up in

order to offer certified cladding

systems – recommended entry

strategy is to license existing wall

lining system from foreign company

while building up expertise and

proprietary system

▪ Low risk to the Qatar Rail project

potential risk to customer experience

and quality perception

▪ Medium – high as it creates

moderately skilled jobs within

advanced materials

▪ Potential to support Qatar’s plastic

manufacturing sector, depending on

whether high-grade plastics are

manufactured locally or sourced

abroad

▪ Creates steady steam of revenue

from wall cladding replacement

▪ Opportunity to support local and

regional construction boom

▪ Opportunity for Qatari entrepreneur to

manufacture pre-fabricated wall lining

systems in order to gain market share from

current imported wall lining

▪ Wall lining offers improved durability,

building performance, and aesthetics on

both internal and external facades

▪ Main customers range across almost all

building types (e.g. public sector,

residential and non-residential buildings),

and penetration rates are currently low

▪ Key decision makers are primarily

developers and main contractors and to

lesser extent architects, engineers, and

designers

▪ Value proposition is comparable quality to

imported systems, lower costs, products

tailored to local market, and speed to

market

▪ Final look and feel of interior linings

will be crucial

▪ Opportunity to build up know-how

within high-tech panel systems, e.g.

in regards to noise reduction

properties, safety, and durability



– 2012 to 2020: 10mn

– 2021 to 2032: 10mn

▪ Additional revenue from the GCC

region between 2012-2032 is also not

included, although significant

potential exists – wall lining makes up

~1-1.3% of building construction

costs

OPPORTUNITY

FOR NEW

BUSINESSES




of this opportunity


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SOURCE: McKinsey

Manufacture of protection walls 107: INFRASTRUCTURE PROVISION – EXTERIOR FINISHINGS

▪ High feasibility for concrete, wood,

steel, aluminum, panel, and acrylic

walls (acrylic would be imported) as

capabilities already present in Qatar

▪ Existing companies of aluminum and

steel walls and facades include High

Vision and Jersey Architectural

▪ If fiberglass walls are required, a

pultrusion plant would need to be

established as currently none exist in

Qatar (low quality fiberglass is

produced by e.g. Al Muftah Fiber,

Gulf Glass Fiber, Teitan Fiberglass)

▪ Low strategic value if walls are made

out of basic materials as opportunity


▪ More complex materials and complex

finishes would build up architectural

and engineering knowledge that can

be applied outside of rail project

▪ A pultrusion plant would have

numerous applications outside of rail

(e.g. construction reinforcements,

corrosion-resistant floor mats, and

high strength tunneling components)

and and would have high strategic

value



– 2012 to 2020: USD 60mn

– 2021 to 2032: USD 140mn


innovative, more expensive walls is




is also not taken into account

▪ Final “look and feel” of the protection

walls is important, and combining

functionality, design, and quality will

thus be crucial

▪ Potential to integrate solar panels into

protection walls

▪ Opportunity to purchase more

expensive fiberglass protection walls

(together with fiberglass masts for

electrification) to support potential

new pultrusion plant

▪ Provision of ~100km of protection walls to

minimise noise, sight, and potentially

vibrations from railway, including design,

manufacture, and installation

▪ Protection walls can be made from

numerous materials (e.g. concrete, wood,

steel, aluminium, composite panels,

fiberglass, acrylic), depending on desired

noise reduction, quality, cost, and finish

▪ Main customer will be railway as well as

public entities (e.g. for motorways, airports,

and public parks)

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Design and landscaping services for parks/green areas

▪ Design and landscaping of parks and green

areas around the stations, including design

of lay-out and pathways, selection of

plants/trees and incorporation of special

features

▪ Opportunity for planning and design to also

include water-efficient components,

including efficient irrigation techniques to

decrease need of water

▪ Key success driver is designing attractive

external areas which are water efficient


▪ Might be procured together with the

actual construction/landscaping of the

parks and green areas


108: INFRASTRUCTURE PROVISION – EXTERIOR FINISHINGS



– 2012-2020: USD ~3 mn

– 2021-2032: USD ~2 mn

▪ Medium




(landscape engineers)


this space, including Al Nakheel

Agriculture and Trading Company,

and Sidra Agriculture Company


risk

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Construction of parks/green areas

▪ Construction of parks around station and

building areas within the specifications set

by the landscaping design

▪ Involves full range of activities, including

earthworks, planting trees/plants, laying

pathways, installing external lighting and

laying irrigation facilities

▪ May also involve installation of public

recreation facilities, such as benches,

tables and outdoor playground






mn:

– 2012-2020: USD ~75 mn

– 2021-2032: USD ~50 mn


this space, including Al Nakheel

Agriculture and Trading Company,

and Sidra Agriculture Company


risk

▪ Medium




(landscape engineers)

▪ Might be procured together with the

design of the parks and green areas

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Contents










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Technical facility management services 114: INFRASTRUCTURE OPERATIONS – PROPERTY AND STATION MANAGEMENT




this space, including Waseef Property,

Como Facility Management, Goodwin

Qatar, Lynx Qatar, Al Doha

Maintenance and Services


risk



– 2012-2020: USD ~5 mn

– 2021-2032: USD ~30 mn

▪ Medium



– Creates some knowledge-based

jobs (MEP engineers and

technicians)

▪ Provision of technical facility management

services, including electrical, mechanical

and plumbing repairs and maintenance

across all stations and non-rail

infrastructure

▪ Value proposition: single point of contact

and in-depth knowledge property and

equipment

▪ Key success drivers include customer

service, quick deployment of relevant

personnel, technical expertise/capability

and cost management

▪ Maintenance and repairs can be

procured separately, or as part of

umbrella agreement which includes

end-to-end property and facility

management

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Infrastructural facility management services 115: INFRASTRUCTURE OPERATIONS – PROPERTY AND STATION MANAGEMENT


▪ Cleaning and security services can be

procured separately, or as part of

umbrella agreement which includes

end-to-end property and facility

management

▪ Station cleaning services may be

procured together with rolling stock

cleaning services



this space, including Waseef Property,

Como Facility Management, Qatar

Cleaning Company (QCC), Al

Mutawassit, Lynx Qatar, Aamal

Services, OTS Cleaning Qatar

▪ Specialised security companies

include

– Qatar Security Services

– Al Bateel Securicor

– Bin Arbaid Group



experience



– 2012-2020: USD ~1 mn

– 2021-2032: USD ~11 mn

▪ Provision of infrastructural facility

management services, including ancillary

services such as cleaning and security

across all stations and non-rail

infrastructure

▪ Value proposition: single point of contact

and in-depth knowledge property and

equipment

▪ Key success drivers include customer

service, quick deployment of relevant

personnel, technical expertise/capability

and cost management

▪ Low





OPPORTUNITY

FOR EXISTING

BUSINESSES


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Commercial property management services 116: INFRASTRUCTURE OPERATIONS – PROPERTY AND STATION MANAGEMENT



▪ Several Qatari or Qatari-based

companies offer all or some of the

services in this space, including

Waseef Property, Colliers International

Qatar, Properties Real Estate, Al

Asmakh Real Estate Development

Company, Lynx Qatar

▪ Examples of tenancy consulting and

asset optimization companies include


risk



– 2012-2020: USD ~1 mn

– 2021-2032: USD ~1 mn

▪ Provision of commercial property

management services, including

– Leasing (tenant identification and

negotiation, vacancy advertising and

sales agent management)

– Tenancy management (contract

administration, rent collection, etc.)

– Tenancy consulting, which is providing

financial analysis services to advise on

tenant segments to pursue

– Property asset optimization services,

which is advising on how to procure,

manage, maintain and dispose of assets

▪ Key success drivers include robust financial

analysis and knowledge Qatar real estate

market

▪ Qatar Rail may choose to manage

leasing and tenancy management

internally

▪ Medium



– Creates some knowledge-based

jobs (financial analysts)

OPPORTUNITY

FOR EXISTING

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SOURCE: McKinsey

Automated car parking services 119: INFRASTRUCTURE OPERATIONS – STATION SERVICES

▪ Overall ease of capturing high

– Low technical complexity using

imported proven technologies

– Low operational know-how and

skills needed

– No risk of project impacting

metro operations

▪ Low strategic value for Qatar

– Most value add activities in

manufacturing and developing

the actual technology done

outside Qatar. Thus, no creation

of high value-adding jobs

– Low export potential since model

is easily copied by local

companies

– Manufacturing opportunities of

steel components created that

could be sourced locally

▪ Operation of automated parking solutions

in connection to select stations

▪ Parking technology and construction of

parking space sourced from establish ed

player

– Cost USD 10-15mn, 500 car capacity

– Pay-back time 2-3 years

▪ Value proposition to offer convenient, safe,

state of the art parking

▪ Key locations for parking spaces;

– Metro hubs and end-of-line stations

– Special destinations, e.g., airport,

world cup stadiums and Education City

– Large industrial areas

▪ Key revenue stream in parking rents and

advertisement fees from facade space rent

▪ Major costs are construction costs and cost

of equipment and ticketing machines

▪ Potential to expand to convenient storage

and safety business


to Qatar rail sums up to USD ~13 mn

from operations, e.g. parking fees:

– 2012-2020: USD ~2 mn

– 2020-2032: USD ~11 mn

▪ Medium upfront investment

▪ Need to carefully map out in which

stations and sites to install solution in

to maximize usage

▪ Need to start plan now with station

architects on how to integrate in

stations

▪ Concept tested in small scale in

Dubai


OPPORTUNITY

FOR EXISTING

BUSINESSES


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Retail services – Travel agencies



services, e.g.

– E2E Travel & Tours

– First Choice Travel

– Happy Journey Travels

– Lusail Travel

– Gulf Ghazal Travels

– Travel Mannai Corporation

– Regency Holidays

– Qatar Adventure

▪ No risk for hampering development of

metro/rail network itself

▪ Low strategic value

– No real potential for exports to other

GCC countries due to Qatar Rail

project

– No real potential for creating high

skilled jobs

– No competitive advantage

▪ Running a chain of outlets that provide

travel services to passengers of the metro

and rail network

▪ There are several types of travel services

that can be provided

– Travel agency that provides advice and

books trip for tours, vacations etc.

– Currency exchange services

– Guided tours in and around the stations

and in Doha city (including Olympic

games and World Cup stations)

▪ Chain can be extended to other places like

– Airports

– Shopping malls


▪ Revenues from sales to customers with a

premium due to convenient location

▪ Main costs in rental payments to Qatar Rail




– 2012-2020: USD ~5 mn

– 2021-2032: USD ~60 mn

▪ N/A


120: INFRASTRUCTURE OPERATIONS – STATION SERVICES OPPORTUNITY

FOR EXISTING

BUSINESSES


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Retail services – Convenience stores



services, e.g.

– Carrefour

– Lulu Hypermarket

– Grand Mart Trading Co

– SADITA Holding Co

– Food Palace

– Ahmed Salmin Shamlan & Partners

– Al Safeer Centre






project


skilled jobs


▪ Running a chain of convenience stores or

mini-markets, in franchise or proprietary

concept

▪ Stores sells all type of convenience

products like

– Groceries

– Toiletries

– Soft drinks

– Tobacco products

– Household items


– Airports

– Shopping malls








mn:

– 2012-2020: USD ~5 mn

– 2021-2032: USD ~150 mn

▪ N/A



FOR EXISTING

BUSINESSES


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Retail services – Kiosks and newspaper stands



services, e.g.

– Abu Karbal Bookshop

– Al Almyah Bookshop

– Al Elmeyah Bookshop

– Al Maaref International Trading

Company LLC

– Jarir Book Store






project


skilled jobs


▪ Running a chain of kiosks and/or managing

news paper stands

▪ Sells products like

– Newspapers

– Books

– Magazines

– Etc.


– Airports

– Shopping malls








– 2012-2020: USD ~2 mn

– 2021-2032: USD ~25 mn

▪ N/A



FOR EXISTING

BUSINESSES


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Retail services – Coffee shops



services, e.g.

– Colombian Coffee House

– Al Khaima Restaurant & Coffee Shop

– Al Kharess Coffee

– Chalet De Café

– Le Gourmet Restaurant

– Al Khaima Restaurant & Coffee Shop

– Al Mandarin Cocktail & Coffee Shop






project


skilled jobs


▪ Running a chain of coffee shops and cafés


– Airports

– Shopping malls








– 2012-2020: USD ~2 mn

– 2021-2032: USD ~50 mn

▪ N/A



FOR EXISTING

BUSINESSES


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Retail services – Restaurants



services, e.g.

– Al Jassim Group

– Al Sindebad Restaurant & Kitchen

– Al Tazaj Fakeih

– Arbys






project


skilled jobs


▪ Running a chain of (fast food) restaurants

that sells food and drinks on the premises

or for take away in franchise or proprietary

concept


– Airports

– Shopping malls








mn:

– 2012-2020: USD ~5 mn

– 2021-2032: USD ~100 mn

▪ N/A



FOR EXISTING

BUSINESSES


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Retail services – Laundry services



services, e.g.

– Pressto Quality Express

Drycleaners

– Prestige Laundry Group

– Magic Laundry LLC

– Al Ahmadi Laundry & Dry Cleaning

– Al Eid Industrial Laundry

– Al Rayes Laundry Equipment &

Accessories

– Arabian Modern Laundry






project


skilled jobs


▪ Running a chain of outlets that provide dry

cleaning and laundry services


– Airports

– Shopping malls








– 2012-2020: USD ~2 mn

– 2021-2032: USD ~60 mn

▪ N/A



FOR EXISTING

BUSINESSES


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Retail services – Car rentals



services, e.g.

– Europcar Qatar

– Rent Car Doha

– Sixt Cars

– Aldeera Travel

– Gulf Ghazal Rent a Car Co WLL

– Regency Fleets






project


skilled jobs


▪ Running a chain that provides car rental

services


– Airports

– Shopping malls







to Qatar rail customers sums up to

USD ~120 mn:

– 2012-2020: USD ~5 mn

– 2020-2032: USD ~115 mn

▪ N/A



FOR EXISTING

BUSINESSES


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Waste services for stations and railway operations

▪ Provision of waste management services,

including collecting waste from waste bins

and transportation to landfills and recycling

plants

▪ May include the actual supply and

installation of waste collections points

▪ Value proposition is commitment to

recycling and multiple pick-up times

scheduled per day

▪ Key success drivers include cost

management, specialized equipment and

coordination with in-station cleaning

services (infrastructural property

management)


▪ May be procured together with station

cleaning services


128: INFRASTRUCTURE OPERATIONS – UTILITIES AND ENERGY PROVISION


this space, including Boom Waste

Treatment Company, MCC Qatar,

Aamal Services, Al Haya Waste

Management, Averda Qatar, OTS

Cleaning Qatar



experience



– 2012-2020: USD ~1 mn

– 2021-2032: USD ~2 mn

▪ Low



– Is required as a basic service for

the country

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Manufacture of interior replacements 135: ROLLING STOCK PROVISION – BODY

▪ Possibility to source major

components internationally and do

minor modifications in Qatar

▪ Existing furniture suppliers can enter

this space, including Jaidah

Furniture, Al Mana & Partners

▪ Long ramp-up time possible as

replacements of interiors not required

before mid 2020s

▪ Qatar has no proven expertise in

designing interiors, and no cost

advantage to manufacture

– High-end ergonomic designers

primarily based in Europe (eg.

TDI, Koshii Maxelum, Fenix

International)

– Cost-efficient alternatives in

China (eg. FCNT)

▪ Limited strategic value for Qatar

given:

– Does not create knowledge-

based job opportunities

▪ Manufacture and supply of rolling stock

interior replacements, including carpets,

upholstery, furniture fittings, door handles

▪ Opportunity to replace the interiors

originally supplied by OEM with minor local

customization of interiors from other

suppliers

▪ Possibility to extend services to all types of

domestic/region public transport operators

(train, metro, bus, ferry)


sales to Qatar Rail: USD ~3mn, all

incurred in 2021-2032 (only considers

interior replacement for rolling stock

procured in Metro phase 1)



▪ Possibility that OEM supplying rolling

stock will also supply interior

replacements


SOURCE: McKinsey

OPPORTUNITY

FOR EXISTING

BUSINESSES


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Rolling stock safety inspections 153: TRANSPORT OPERATIONS – ROLLING STOCK AND SPARE PARTS MANAGEMENT

▪ Qatari companies involved in vehicle

inspection could extend into this area,

such as Qatar Technical Inspection

Company Woqod Vehicle Inspection,

Qatar Airways

▪ Qatar Airways’ safety capabilities

should be leveraged as an example

▪ Potentially high risk due to difficulty in

ramping up capabilities from scratch

– which exposes project to risk

▪ Providing services only to Qatar Rail

may not provide sufficient scale for

business to be attractive

▪ Critical service needs to be up and

running before launch

▪ Medium strategic value given

– Opportunity for Qatari company

to provide similar services to

other regional railway operators

– Provides ongoing profitable

revenue stream

– Creates technical job

opportunities for engineers

(maintenance engineers,

technicians) is a knowledge

intensive sector

– Technical skills and equipment

can be used to cement Qatar

reputation for quality and safety

▪ Provision of safety inspection service to

ensure overall compliance with safety and

maintenance regulation

▪ Minimizing safety risk would require

partnership with established player until

local company is up and running

– Will require several years to build up

the necessary capabilities

▪ Key success drivers:

– Technical certification, including of

inspectors

– Rigorous operational processes

▪ Requires a joint venture with established

rolling stock safety inspection company at

least in initial 3-5 years



sales to Qatar Rail: USD ~ 35-40mn:

– 2012-2020: 3.5mn – 4mn

– 2021-2032: 30mn–35mn

▪ No revenue potential from sales to

other Qatar companies expected


across GCC: USD ~1.4mn

▪ Railway operators typically obliged to

outsource this service by law to get a

certificate of approval from

government authorities/regulator

▪ Suppliers either national bodies (e.g.

German Federal Railway Authority)

or private institutions, such as TÜV,

Dekra, Bureau Veritas, Intertek

▪ Private safety inspection companies

are often also involved in inspecting

automobiles



OPPORTUNITY

FOR NEW

BUSINESSES


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Maintenance and repair of rolling stock 154: TRANSPORT OPERATIONS – ROLLING STOCK AND SPARE PARTS MANAGEMENT


▪ Currently no capability for rolling

stock, but Qatar Airways’ maintenance capabilities can be

leveraged as an example

▪ Qatari companies currently providing

vehicle maintenance/repair service,

such as Al Mannai, could enter this

space

▪ Qatari company will require JV

agreement to ramp-up its capability

– Minimizing safety risk would

require partnership with

established player until local

company is up and running

– Will require several years to build

up the necessary capabilities

▪ Critical for Qatar Rail success

▪ Medium strategic value given

– Opportunity for Qatari company

to provide similar services to

other regional railway operators


revenue stream

– Knowledge intensive sector

which creates technical job

opportunities for engineers

(maintenance engineers,

technicians)

▪ Provision of maintenance and repair

services for rolling stock (including

workshops)

▪ Option to JV with OEM or with large

maintenance provider

– OEMs such as Siemens have entered

JVs with local providers

– Euromaint has used JVs with local

partners to expand outside Sweden

▪ JV could stipulate a gradual phasing out of

the OEM and replacement by local Qatari

company as expertise is built

▪ Key success drivers:

– Technical certification and expertise

– Cost control

– Rigorous operational processes



▪ Total revenue potential from Qatar

Rail: USD ~600 – 625mn:

– 2012-2020: 60mn – 65mn

– 2021-2032: 540mn–560mn




across GCC: USD ~20-25mn

▪ Services are typically either

performed by railway operator, OEM

and only sometimes by independent

maintenance company (NTV)

▪ Leading suppliers include Euromaint,

Deltarail, Nedtrain – but the market is

very fragmented

▪ Several European suppliers are

recently privatized maintenance units

of national railway operators

OPPORTUNITY

FOR NEW

BUSINESSES


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Rolling stock spare parts management 155: TRANSPORT OPERATIONS – ROLLING STOCK AND SPARE PARTS MANAGEMENT

▪ Qatari logistics and spare parts

distributors, could move into this

space

– For example an automobile

spare parts management

company such as Al Mannai can

additionally support rolling stock

parts

▪ But there is a high risk of operational

disruptions if supply chain is mis-

managed

▪ Opportunity for company to use Qatar

Rail as a nucleus before serving

other clients as a regional supply

chain management company

▪ Potential to serve regional railway,

airline and manufacturing companies

▪ Provides ongoing profitable revenue

stream

▪ Opportunity to leverage synergies

with Qatar Airways, car/machinery

maintenance companies

▪ Creates knowledge based jobs

(demand forecasters, supply chain

specialists)

▪ Management of rolling stock spare parts

inventory, including

– Order management

– Warehousing

– Storage and distribution

▪ Local supply chain service provider could

initially manage only low risk supply chain

requirements

▪ Customer will either be the maintenance

contractor or the railway operator

▪ Qatari company could use JV agreement

to ramp-up its capability in this space, with

either:

– Railway spare parts suppliers, such as

Alstom (FR)

– Global logistics provider, such as

UPS, DHL, DB Schenker (DE),

Kuehne + Nagel (DE)



sales to Qatar Rail: USD ~ 28-34mn:

– 2012-2020: 3mn – 3.5mn

– 2021-2032: 25mn – 30mn


other Qatar companies: USD ~60mn


across GCC: USD ~130mn

▪ Typically managed by the railway

maintenance service provider or

railway operator itself, with goods

supplied directly from OEM

▪ Integrated supply chain management

services agreement are increasingly

prevalent globally, with partnerships

between client and specialist service

provider, eg. UPS or DHL



OPPORTUNITY

FOR NEW

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Rolling stock cleaning service 156: TRANSPORT OPERATIONS – ROLLING STOCK AND SPARE PARTS MANAGEMENT

▪ High ease of capturing as several

Qatari companies are already

providing this service, such as

– Qatar Cleaning Company (QCC)

– Al Mutawassit

▪ Meeting Qatar Rail requirements

would not require significant

investment

▪ Low risk

▪ Low:

– Not knowledge intensive

– Limited opportunities to use

Qatar Rail as a nucleus for

growth beyond Qatar

– Low margin sector

▪ Providing daily cleaning service for rolling

stock fleet, including

– Interior cleaning/ sweeping

– Plumbing and sanitation services

– Body wash

▪ Potentially can be outsourced to the

company which currently provides janitorial

services to other public buildings ▪ Total revenue potential from initial

sales to Qatar Rail: USD 26-27mn

– 2012-2020: 1.7-1.8mn

– 2021-2032: 24-25mn



▪ Typically provided by janitorial

service provider companies which are

not specialised in the railway sector,

such as public locations, airports,

offices, etc.

SOURCE: McKinsey

OPPORTUNITY

FOR EXISTING

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Strategic value

Other considerations

Training academy for railway professionals

SOURCE: McKinsey

158: TRANSPORT OPERATIONS – PERSONNEL

▪ Qatar’s track record in education

would allow it to develop state-of-the-

art training facilities

▪ Potential synergies with Qatar-based

universities, including Texas A&M

and Carnegie Mellon, for sharing

classroom facilities, dorms, R&D labs

and libraries

▪ Challenge will be ensuring

international credibility – hence

importance of JV with OEM or global

training provider, eg. L3 MPRI

▪ High:


– Aligned with Qatar’s focus on

education

– Opportunity to establish Qatar as

regional hub for training specialist

technical professionals

– Opportunity to extend beyond rail

to serve other sectors

▪ Question is whether there will be

sufficient demand to justify creating

such an institution in the region

▪ Management of training academy for rail

professionals, including operators,

maintenance engineers and technicians,

signalling and telecom professionals,

electricians

▪ Academy would primarily serve Qatar Rail

employees, but over time would also have

from other operators

– Growing demand from rail operators in

the region for trained professionals,

new school opened in Egypt, several

hundred employees from KSA,

Bangladesh and Afghanistan sent to

North America each year for training

– Opportunity to partner with globally

recognized railway player, such as

DBI or Bombardier

▪ Academy should also offer certification for

new train operators, drivers, and

technical staff

Business opportunity Ease of capturing


sales to Qatar Rail: USD ~ 75-77 mn:

– 2012-2020: 20-22 mn

– 2021-2032: ~55 mn




across GCC in 2012-32:

USD ~80-85 mn

▪ Training is typically managed by the

railway companies internally, but with

key courses outsourced to specialist

providers such as Hydrex Training

(UK) or Rail Skills Training Centre

(AU)

▪ Examples of dedicated training

institutes include Norwegian Railway

Academy and CENACAF

▪ Training academy could also include a

regional centre for innovation, in

partnership with international

innovation players such as Siemens

Size of opportunity

OPPORTUNITY

FOR NEW

BUSINESSES




of this opportunity

http://www.railway-technology.com/contractors/professional/mtr_training/mtr_training4.html


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Provision of staffing solutions 159: TRANSPORT OPERATIONS – PERSONNEL


sales to Qatar Rail: USD ~110mn-

120mn:

– 2012-2020: 2.5mn – 3mn

– 2021-2032: 60mn – 65mn



▪ For all non-technical staff, including

customer services, ticketing officers and

passenger announcements

▪ Provision of end-to-end staffing services,

including

– Recruitment

– Staff deployment

– Training academy management

▪ Value proposition is for local Qatari

company to manage roster of customer

service employees that can be deployed

across portfolio of clients, eg. Hotels,

malls, etc.

– Opportunity to drive Qatar as a

regional hub for customer service

excellence

▪ Rail operators typically only

outsource short-term/specialist

requirements, eg. Teams of

specialist engineers for track

maintenance works

▪ Opportunity to extend services to

other customer-service companies in

the region, including:

– Public transport

– Airlines

– Hospitality

▪ Low:


– Some potential to become

regional innovator in staff

training and deployment

capabilities

▪ Relatively easy to capture:

– Replicating Qatar Airways model

for recruiting, training and

deploying flight attendants

▪ Qatar’s track record in education

would allow it to develop state-of-the-

art training facilities

– Opportunity to explore synergies

with Training Academy

▪ Potential commercial risk in being

able to source clients outside of Qatar

Rail

▪ Little/no competition risk

▪ Low risk for Qatar Rail

SOURCE: McKinsey

OPPORTUNITY

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SOURCE: McKinsey

Rail infotainment 160: TRANSPORT OPERATIONS – MARKETING AND SALES

▪ Qatar does not have the

technological capabilities to develop

the solution, but does have significant

capabilities in content generation

– Content generation could be

driven in partnership with local

partners, including Al Jazeera, to

provide customers with local

relevant themes and topics

▪ Low risk to Qatar Rail project

▪ Relatively low competition as this is

new industry and no ARAB/GCC

companies in this SPA


– Opportunity develop innovative

content and business model that

meets local requirements


– Opportunity to be first mover in

this space in Middle East

▪ Development of interactive onboard

entertainment media solutions, including

– Content generation

– Technology platforms and interface

– Maintenance

▪ Revenues generated by usage and/or

advertising sales

▪ Technology platform to be procured from

proven railway infotainment supplier, such

as Funtoro, Televic, Harman, content to be

procured from regional content producers,

such as Al Jazeera, MBC

▪ Key success factor is getting the content

right to attract local and expatriates, and

attracting right advertisers


sales to Qatar Rail: USD ~9 - 10mn,

all incurred in 2021-2032

▪ Additional revenue exports to GCC

region not taken into account

▪ Possible that Qatar Rail does this

internally or that it is outsourced to

QMedia


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SOURCE: McKinsey

Rail newspaper 161: TRANSPORT OPERATIONS – MARKETING AND SALES

▪ Requires minimal initial investment

and management

– Qatar already has printing press

capacity

– Opportunity for local broadsheet

newspaper, such as The

Peninsula, Qatar Tribune or Gulf

Times

▪ Only area requiring ramp-up is

advertising sales capabilities


▪ Low likelihood of competition

▪ Opportunity to export model to other

regional customers

▪ Does not diversify the economy or

create many knowledge based jobs

▪ Development of a newspaper specifically

tailored for passengers – designed to be

read in 20 minutes, broad appeal

▪ Newspaper is free, with revenues

exclusively generated by advertising sales

▪ Content is purchased from other media

outlets, and re-formatted/shortened to

ensure broad readership

▪ Business model has been successfully

launched across many cities, including

Dubai

▪ Can also be distributed outside Qatar Rail

– Malls

– Commercial buildings

– Offices



– 2012-2020: 3mn – 3.5mn

– 2021-2032: 15mn – 20mn



▪ Difficult model to get right

– No secure customer need to

build advertising relationship

from scratch

– Several free newspapers have

struggled financially

▪ Need to determine appropriate

language/format for Qatar


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Call center services 162: TRANSPORT OPERATIONS – MARKETING AND SALES

▪ To be cost competitive while

maintaining Arabic language

capability, call centre should be

located in Oman / Egypt / Jordan

▪ Call centre outsourcing requires

strong SLAs and reliable partners to

be successful

▪ Risk would be relatively low

▪ Medium:

– Low margin sector


▪ Potential to make Qatar the a

regional hub for customer service

excellence

– Opportunity to explore synergies

with Qatar Airways

▪ Management of inbound call centre for

passenger rail and metro customers to

handle

– Passenger questions and complaints

– Billing questions and top-ups

▪ Opportunity to manage an outsourced call

centre which serves both Qatar Rail and

other companies in the region, including:

– Public transport authority

– Airlines

– Hospitality

▪ Value proposition: meet local language

/cultural requirements while ensuring low

cost efficiency



– 2012-2020: 1.5mn – 2mn

– 2021-2032: 8.5mn-10mn



▪ When outsourced, call centres are

typically run from low-cost

destinations, such as India,

Philippines, Egypt and Jordan

▪ Qatar Airways has relocated part of

its Arabic call centre to Muscat,

Oman

SOURCE: McKinsey

OPPORTUNITY

FOR EXISTING

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Website services 163: TRANSPORT OPERATIONS – MARKETING AND SALES

SOURCE: McKinsey

▪ Qatar has limited track record in IT

software development

▪ Not critical for overall timeline – need

not be fully functioning before 2020

▪ Potential partnership with global

player and/or Qatar Airways IT

function to ensure overall technical

robustness

▪ No risk to Qatar Rail project but

commercial risk as this is competitive

sector

▪ Medium

– Could serve as basis for small

start-up to develop expertise to

serve other customers in future

– Creates knowledge-based job

– Aligned with Qatar’s aspiration to

become the region’s ICT hub


revenue stream through website

maintenance

▪ But creates few jobs (~10-50 FTEs)

▪ Design and management of online portal

which includes

– Train schedules

– Ticket purchases and top-ups

– Information of onboard services

▪ Does not include design and management

of back-end ticketing systems

▪ Qatar Rail to serve as platform for

company to design website with concept

adapted to Qatar

▪ Revenues from development of web

platform, and maintenance including

updates, upgrades, debugging, etc.



sales to Qatar Rail: USD ~4.5 - 5mn:

– 2012-2020: ~1mn

– 2021-2032: ~ 3.5 – 4mn


other Qatar companies: USD ~145 –

150mn


across GCC: USD ~30 – 32mn

▪ Typically rail operators manage

website internally, but outsource set-

up of interfaces between website and

ticketing systems with large

POS/eCommerce technology

companies, such as Siebel, IBM

▪ Increasingly boutique portal design

companies are handling these

requirements, such as CSI Media


OPPORTUNITY

FOR EXISTING

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SOURCE: McKinsey

Advertising management services 164: TRANSPORT OPERATIONS – MARKETING AND SALES

▪ Requires minimal CAPEX investment

▪ QMedia has capabilities in this space

already

– Expertise for advertising space

planning would need to be

brought in from established

agencies in developed cities

▪ Day-to-day management of

advertising sales can be run by Doha-

based company

– But to be profitable company

would need to quickly establish

itself beyond Qatar Rail and Qatar

▪ No risk for rail operations and little

start-up investment required

▪ Medium:

– Potential for Qatar to develop first

wholly dedicated, domestic

advertising sales agency focused

on public areas

– Opportunity for company to

develop innovative advertising

themes tailored to GCC culture

and demands ▪ Management of all in-station and on-board

advertising, including:

– Identification and fit-out of advertising

platforms, eg. billboards, screens, etc.

– Key account management / outbound

sales

– Pricing

▪ Opportunity to collaborate with Qatar Rail

on station design to optimize

advertisement point placement and

visibility



275mn:

– 2012-2020: 10mn – 15mn

– 2021-2032: 250mn-260mn



▪ Outside the Middle East advertising

sales are increasingly – but rarely

completely – outsourced to third party

agents, including PharPartnerships

(serving London Underground),

PubliGroupe, Lamar, Search Media,

Air Media

▪ No large, dedicated advertising sales

agency in Middle East – only

company with capability is ITP (UAE),

which only sells in media space

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SOURCE: McKinsey

PR and external communication services 165: TRANSPORT OPERATIONS – MARKETING AND SALES

▪ High

– Several Qatari communications

companies already exist,

including QMedia, GrowQatar,

Oryx Advertising Company,

AdaBisc

– Commercial risk is low as little

up-front investment required

– Competition is high as several

regional and international present

▪ Medium


– Reinforces Qatar’s positioning as

a regional marketing and

communications hub

▪ But creates few jobs (~10-50 FTEs)

and is relatively low value

▪ Provide external communications

management services to Qatar Rail,

including:

– Above the line campaigns (billboards,

TV ads, etc.)

– Below the line campaigns (direct

marketing, point-of-sale material

design, etc.)

– Corporate communications (press

releases, events, etc.)

▪ Value proposition to provide advertising

services sensitive to local culture


sales to Qatar Rail: USD ~5.5mn-

6mn:

– 2012-2020: 2.4mn – 2.5mn

– 2021-2032: 3mn-3.5mn



▪ Unclear if Qatar Rail will outsource

any communications

requirements/campaigns as it already

has a Public Relations Department

OPPORTUNITY

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Construction of energy efficient cooled walkways 167: TRANSPORT OPERATIONS – CUSTOMER SERVICES

▪ Qatar has no significant experience in

developing cool walkways

– But several construction

contractors have developed

conventional cooled walkways in

Doha, eg. Doha Airport

▪ Long time for ramp-up possible

because Qatar Rail can phase in

these cooled walkways in later stages

of station infrastructure development

▪ No risk to Qatar Rail but high initial

investment required

▪ Opportunity for Qatar Rail to trigger

development of innovative, energy-

efficient cooling technologies

▪ Size of Qatar Rail probably sufficient

to create business case for start-up

▪ Opportunity to use product

extensions for application in other

construction and infrastructure

projects

▪ Qatar has significant need for such a

solution for the Olympics

and World Cup

▪ Build cooled walkways linking stations to

nearby buildings

▪ Qatari company to build new partnerships

across variety of suppliers to integrate

proven energy efficient technologies and

products, such as:

– Shaded glass

– Insulation

– Renewable energy sources (e.g., solar

panels or PV cells in glass)

– Low energy use ventilators

▪ Opportunity for Qatar to

– Lock in global suppliers for projects

across region

– Drive integration of an energy efficient

solution specifically adapted to the

GCC climate



sales to Qatar Rail: USD ~135-160 mn

– 2012-2020: 55– 60 mn

– 2021-2032: 80–100 mn


other Qatar companies: USD ~40 mn


across GCC: USD ~135 mn

▪ Dubai and Kuala Lumpur have

several ongoing cooled walkway

construction projects

▪ Although there is still significant

opportunity to develop more energy

efficient designs and materials

▪ Will require additional research and

development beyond initial

installation

SOURCE: McKinsey

OPPORTUNITY

FOR NEW

BUSINESSES




of this opportunity


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Car-sharing services (Car 2 Share) 168: TRANSPORT OPERATIONS – CUSTOMER SERVICES

SOURCE: McKinsey

▪ Qatari entrepreneur is well placed to

capture opportunity but should focus on

successful partnership with municipality

and OEM and build capabilities in

operations

– Qatar traffic is growing rapidly

increasing the need for innovative

mobility solutions

– Car sharing could become integral

part of the transportation master plan

of MMUP (Central Planning Office)

– OEMs are likely to engage in

partnerships


– Congestion management is on top

op Qatar’s agenda (CPO) since

Greater Doha will grow rapidly and

see tremendous increase of visitors

due to WC 2022

– Sustainable and environmentally

friendly business concept, good for

Qatar’s image


to provide short term rental cars in the greater

Doha area

▪ Rent out small (electric) vehicles for short

distance trips in greater Doha area without

reservation on a per minute basis

▪ Targeted customers in Qatar are mid-income

Qatari residents and tourists

▪ Value proposition to customers is the

convenience (all-in-one payment, ease of

parking, flexibility of pickup), eco-friendliness

and the financial attractiveness of the solution


usage fees, registration fee (to cover costs),

advertisement income and value-adding

services (e.g. renting out navigation system)


▪ Initial revenue in 2020 is ~USD 2.4 mn

projected to grow to ~USD 21 mn by

2026 and afterwards with ~5% per

annum

▪ EBIT in “steady state” is ~USD 7 mn

growing with expansion of fleet,

representing a EBIT margin of ~25%

▪ Initial up-front investment is ~USD 4.1 mn

of which ~USD 1.2 mn needed for setup

organization, office space and

development of IT solutions and ~USD

2.9 mn for purchase of initial fleet

▪ Currently there is no competition in the

GCC, main players internationally are

Car2Go (Daimler, Europe), ZipCar

(US/UK, merged with Streetcar),

DriveNow (Sixt/BMW, Europe), Connect

(Hertz, Europe/US), Autolib (Paris)

▪ Barriers for entering the market are

mainly the upfront investment, local

knowledge and network, brand image

and capabilities, therefore giving first

mover big advantage


OPPORTUNITY

FOR NEW

BUSINESSES




of this opportunity


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SOURCE: McKinsey

Personal car transport services 169: TRANSPORT OPERATIONS – CUSTOMER SERVICES

▪ Medium:

– Requires specially adapted

freight wagons to be

made/imported

– But day-to-day management is

easy


▪ Medium to high commercial risk as

each wagon costs USD ~200k

▪ Strong competition expected from

local car rental companies

▪ Provision of personal car transportation

service for long distance rail passengers

(international connections)

▪ Value proposition is allowing passengers

travelling for long stays in different cities to

have their own car at destination

– Target segment: families on vacation

▪ Pricing should be:

– Competitive with local car rental

companies

– Coordinated with Qatar Rail to

maximize passenger flow (ie.

discounted ticket price for passengers

travelling with own car)

▪ Can also be used by local car distributors

to re-distribute stock due to country

specific requirements


sales to Qatar Rail: USD ~235 -

240mn, all incurred in 2021-2032




▪ Will not be relevant until rail links with

international cities are established

▪ Low:


– But creates few jobs (~10-50

FTEs) and is relatively low value

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SOURCE: McKinsey

Passenger security services 170: TRANSPORT OPERATIONS – CUSTOMER SERVICES

▪ High – Qatari companies are already

providing this service, such as

– Qatar Security Services

– Al Bateel Securicor

– Bin Arbaid Group

▪ Meeting Qatar Rail requirements

would not require significant

investment

▪ Low commercial risk because of

contract with Qatar Rail

▪ Medium to high competition

▪ Low:


– Limited opportunities to use

Qatar Rail as a nucleus for

growth beyond Qatar

▪ Provision of passenger security from theft,

vandalism and violence, includes

– Patrols

– CCTV monitoring

– Management of advanced recognition

software (which recognizes aggressive

behavior)

▪ Opportunity to provide integrated,

independent security services which

serves both Qatar Rail and other entities in

the region, including public buildings,

offices and residential areas

▪ Collaboration with Qatar Police Force

required



– 2012-2020: 6mn – 7mn

– 2021-2032: 30mn-35mn



▪ Security is typically provided by local

law enforcement agencies, but

different models existing, including

– Transport/rail-specific police

service

– Private companies

OPPORTUNITY

FOR EXISTING

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SOURCE: McKinsey

Bus feeder services (outside Doha) 171: TRANSPORT OPERATIONS – CUSTOMER SERVICES

▪ Easy to provide this service as there

are several private car and rental

companies already in Qatar with

large fleets of buses

– Competition is relatively high

▪ Commercial risk is low because

buses can be leased, reducing initial

capex investment required

▪ But optimal service requires early

coordination with Qatar Rail on:

– Station design (for bus stop to be

incorporated in the layout), as

well as scheduling and routing

▪ Low:


– Little opportunity to grow beyond

Qatar

▪ Provide bus services linking stations to

outlying areas and cities

– National/regional coach system - not

inner city bus system

– Does not compete with Mowasalat

▪ Value proposition is providing affordable

and convenient “last mile” service to rail

customers ▪ Total revenue potential from initial





▪ Unclear whether Mowasalat will

provide service, and thereby prevent

business opportunity

▪ Need to assess real demand for such

a service

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SOURCE: McKinsey

Onboard food & beverage services 172: TRANSPORT OPERATIONS – CUSTOMER SERVICES

▪ Medium

– Several Qatari catering

companies exist, Dallah

International Catering & Trading,

Friendly Food Qatar, Prestige

Restaurant and Qatar Airways

Catering

▪ Requires some ramp-up by local

player to serve trains – including

adapting supply chain and procuring

train-adapted onboard food storage

equipment


▪ Provision of on-board food and beverage

to passengers on long distance passenger

rail train including trolley service and on-

board restaurant

▪ Value proposition is the freshness of food

prepared locally, and customer service






▪ No ramp-up required for at least

another 5 years

▪ Low:



Qatar

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SOURCE: McKinsey

Luggage management and logistics services 173: TRANSPORT OPERATIONS – CUSTOMER SERVICES

▪ High:

– Already successfully provided by

Qatar Aviation Service/Doha

International Airport ground

service

▪ Low:


– No opportunity to grow beyond

Qatar Rail

▪ Opportunity to provide distinctive

service to Qatar Rail customers

▪ Provision of baggage management service

for long distance rail passengers,

including:

– Home pick-up/drop-off service

– In station porter service

– Baggage wagon

– Station baggage carousel






▪ Baggage wagons/carousels are

common in North American railway

stations

▪ Porter services are present in all

major train stations

▪ GCC airports typically provide

luggage services for business class

customers

Long-term possibility to have airline

check-in and baggage drop-off facility

integrated in station

OPPORTUNITY

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SOURCE: McKinsey

Limousine services 174: TRANSPORT OPERATIONS – CUSTOMER SERVICES

▪ High

– Several Qatari communications

companies already exist,

including Doha Limousine, Al

Watan Limousine, Fox Transport

▪ High competition from personal

chauffers, limousines and taxi

companies

▪ Low commercial risk ▪ Provision of passenger limousine pick-

up/drop-off service for rail passengers

to/from the station

▪ Value proposition is providing passengers

with additional comfort and luxury

customer experience

– Offering should be coordinated with

Qatar Rail to as an added value for

customers ▪ Total revenue potential from initial

sales to Qatar Rail: USD ~37-38mn,




▪ Qatar Rail may become the main

customer of this company in order to

provide its 1st class customers with

the free service, eg.

– Qatar Airways provides this

service to its First and Business

Class passengers on arrival in

most major destinations

▪ Low:



Qatar

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SOURCE: McKinsey

Rail freight operations 175: TRANSPORT OPERATIONS – FREIGHT SPECIFIC OPERATIONS

▪ Medium to low

– Freight forwarding companies

exist in Qatar

– Global freight operations benefit

from scale to negotiate good

rates and schedules with

transport operators

– Highly competitive sector

– Low risk for rail project

▪ Medium

– Creates (few) knowledge-based

jobs


a regional transport hub

▪ Management of end-to-end freight

services, including:

– Freight consignment

– Selection of transport service

– Scheduling / negotiating rates with

transport operators

– Paper administration (including

generating waybills, customs

clearance)

– Potential additional opportunity to

provide freight storage, final assembly

and packaging services

▪ May include the ownership/management of

independent freight wagons/locomotives

▪ Key success drivers will be strong relations

with regional rail operators, cargo airlines,

shipping companies, trucking, and

sea/airports, etc.

▪ Market is dominated by global

players such as Kuehne + Nagel, DB

Schenker, Geodis

▪ European Rail operators tend to have

their own freight forwarding

companies

▪ Independent freight operators not

likely to be set-up before several

years






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SOURCE: McKinsey

Freight services 176: TRANSPORT OPERATIONS – FREIGHT SPECIFIC OPERATIONS

▪ Qatari companies already providing

similar services at New Doha Port

and Airport

▪ Qatari company could have

partnership with existing freight

services company to build up

capability

▪ Commercial risk low as no additional

investment required

– With exception of shunting

▪ Last mile service can be provided by

local Qatari trucking companies

▪ Provision of in-terminal freight services,

including:

– On/off loading,

– Shunting services within yards,

– First/last mile truck transport between

terminal and pick-up/drop-off locations

▪ Key success drivers are speed and

efficiency to ensure freight handling time is

minimized ▪ Total revenue potential from initial





▪ Shunting and terminal services

typically managed by rail operator

directly

▪ Last mile typically managed by

specialized/trucking companies

▪ Medium


a regional transport hub

– Will ultimately drive value

proposition of freight rail vs.

trucking and shipping

OPPORTUNITY

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Contents










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SOURCE: McKinsey

Professional services (legal, insurances, etc.) 176: OTHER OPPORTUNITIES – BUSINESS SUPPORT

▪ Medium-high feasibility, depending on

the complexity of the required

services

▪ Existing companies include Al Misnad

& Rifaat (legal), Al Sayed Accounting

& Auditing (financial services), Qatar

Consulting Group (strategy consulting

and corporate finance), Albahiya

Qatar (IT support), as well as

numerous international companies



jobs (size of Qatar Rail company is

not significant)








– 2012 to 2020: USD 270mn

– 2020 to 2032: USD 360mn


professional services in Qatar and in



▪ Provision of professional services for Qatar

Rail, including

– Legal services

– Financial services

– Strategy consulting services

– IT support services

▪ Opportunity focuses on capturing value

during construction phase, although


OPPORTUNITY

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SOURCE: McKinsey

Supply of IT hardware and software

▪ High feasibility as supply of IT

hardware and software already done

in Qatar

▪ Existing suppliers include Family

Computers, AG Group, and Al Attiya

Computer & Technology WLL




not significant)








– 2012 to 2020: USD 150mn

– 2020 to 2032: USD 70mn


IT hardware and software in Qatar



▪ Supply of IT hardware and software to

Qatar Rail, including

– Computers and laptops

– Printers, scanners, copiers

– Conferencing and presentation

solutions

– IT software

– Accessories (keyboards, mouse,

speakers, cables etc.)

177: OTHER OPPORTUNITIES - BUSINESS SUPPORT OPPORTUNITY

FOR EXISTING

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SOURCE: McKinsey

Supply of office furniture and equipment

▪ High feasibility as supply of office

furniture and equipment already done

in Qatar

▪ Existing suppliers include Abmak

Qatar WLL, Gulf Office Solutions, and

Office Center




not significant)








– 2012 to 2020: USD 50mn

– 2020 to 2032: USD 30mn


office furniture and equipment in



▪ Supply of office furniture and equipment to

Qatar Rail, including

– Computer desks, workstations, and

chairs

– Conference room tables and chairs

– Reception furniture (floor mats, coat

stands, mailboxes etc.)

– Office accessories (lamps, clocks,

artifical plants, fans etc.)

– Stationery, paper, pens etc.

178: OTHER OPPORTUNITIES - BUSINESS SUPPORT OPPORTUNITY

FOR EXISTING

BUSINESSES


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Contents



– Breakdown of filtered out opportunities

– Selected examples of filtered out opportunities



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Breakdown of filtered out opportunities

Limited market

accessibility

Limited feasibility

due to technical

capabilities

coupled with size

of opportunity not

justifying

investments

# of opportunities filtered out

5

44

16

78

4

5

4

Opportunity to be captured by Qatar Rail

Opportunity already outsourced

Opportunity captured by utilities

company

Infrastructure provision

Rolling stock provision

Infrastructure operations

BACKUP

SOURCE: McKinsey team

1

2


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Contents



– Breakdown of filtered out opportunities

– Selected examples of filtered out opportunities



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Filtered out opportunities due to lack of accessibility for entrepreneurs

Utilities

Idea Description Rationale

▪ Provision of

electrical energy

▪ Provisioning of electrical energy

for stations and railway

operations

▪ Opportunity to use rail

investment to establish new

players but outside scope of

projects

▪ Provision of water ▪ Provisioning of water for

stations and railway operations




projects

▪ Provision of

cooling

▪ Provisioning of cooling for

stations and railway operations




projects

1


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SOURCE: McKinsey

Manufacture of pre-fabricated staff accommodations 057: INFRASTRUCTURE PROVISION – CONSTRUCTION SUPPORT SERVICES

▪ High feasibility as prefabricated

housing already produced in Qatar

▪ Existing companies include Qatar

Speed House and Prefab Qatar (on

the market since 2002 and 2006

respectively)

▪ Risk from regional (UAE, KSA) and

global (China, USA) competitors

exists, as prefabricated housing

components can easily be shipped

▪ Risk for project is low



▪ Potential for global champion is

limited as low cost producers exist in

e.g. China

▪ Medium potential for innovation, as

sustainability and recycling of

materials is becoming increasingly

important



– 2012 to 2020: USD 40mn

– 2021 to 2032: USD 30mn

▪ Additional revenues from offering

affordable housing in Qatar and in the



▪ QR must ensure that the working and

living conditions of workers are

acceptable (Qatar and the UAE have

previously been criticised in this area)

▪ Could provide an outlet for new

manufacturing capabilities, e.g. within

steel and aluminium

▪ Potential to integrate with supply of

labour force support services

▪ Provision of affordable housing for work

force at construction sites for Qatar rail,

including manufacturing of prefabricated

elements, onsite assembly of house and

installation of electricity and plumbing

facilities, and disassembly and re-use of

materials at other sites/projects

▪ Majority of components can be sourced in

Qatar (prefabricated concrete, steel,

aluminium, glass, and HVAC components)



the region for affordably housing is

expected to grow in the near future due to

growth in new constructions

Filtered out as this

opportunity was integrated

into opportunity # 53

“Labor force support

services”

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116 SOURCE: McKinsey

Design and manufacturing of cost efficient innovative insulation

materials


▪ Low feasibility

– Targeted technologies to be tested and

with proven effect

– Current Qatari players active in this

field include DicoTech and Qatar

Insulation Factory

– Potential development work to make

insulation material cost efficient to

produce and easy to install

– Researchers at QSTP potentially to

assist on technical development

– Time is critical, e.g. technologies need

to be tested at early stage


– Creation of product/technology with

high export potential

– Creation of high value-add jobs

– High innovation potential

– Potentially strong connection to Qatari

upstream polyethylene production

▪ Business opportunity to provide insulation

solution for stations by;

– Manufacturing material

– Designing in-station usage

– Installation of material

▪ Value proposition to reduce energy costs for

property owners by reducing the need for

cooling

▪ Key revenue streams generated through sales

and installation

▪ Expansion potential into other segments, e.g.,

residential and commercial property

development

▪ Several insulation materials available today

most of which are based on Polythurethane,

e.g., Polythurethane rigid panel, Polythurethane

spray foam

▪ Potential competitive advantage from

inexpensive supply of raw materials


▪ Medium revenue opportunity from sales to

Qatar Rail project

– 2012-2020: USD ~30 mn (TBC)

– 2021-2032: USD ~35 mn (TBC)

▪ Total market in 2011 of USD ~50 mn in

Qatar

▪ Total market in 2011 of USD ~500 mn in

GCC

▪ Market will grow as soon as energy

becomes more expensive

▪ International competitors include,

e.g., BASF (D)


Filtered out as

opportunity is not

feasible due to tight

timelines of rail

project

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Full service provision of ticketing system 112: INFRASTRUCTURE PROVISION – PASSENGER INFRASTRUCTURE

▪ Medium feasibility in JV setup

– High technical complexity can be

bridged with JV

– High financial impact of down-time

– The currently low skills in this field in

Qatar can be enhanced rapidly

▪ Low feasibility to expand operations in to

system design and engineering

– Lead time for local firm long and

feasibility low due to IPR issues, short

product life-cycles and industry

competition

▪ Ticketing system not critical for rail

operations, type of system still to be

decided upon by Qatar Rail

▪ Medium-high strategic value to Qatar

– Medium value potential creation as

Qatari partner focus on spare parts,

assembly and maintenance services

and JV partner performs the most value

adding activities

– High long-term innovation potential

both in software and hardware

technology e.g., e-ticketing / virtual

ticketing

– Potential to expand service and

maintenance business to other metro

systems


– Manufacturing of spare parts, assembly,

installation and maintenance of ticket vending

machines and ticketing gates for stations in

Qatar to be done in Qatar by the JV

– More advanced components sourced from

specialized suppliers abroad

– Established system manufacturer from

abroad to provide the software

▪ Cost advantage for spare parts from

inexpensive supply of raw material e.g., glass,

steel and aluminium

▪ Revenue from installation, maintenance and

selling of spare parts to QR

▪ Key customers are public transportation and

some airport applications

▪ Cost efficiency and high quality manufacturing

critical to success


▪ Medium revenue opportunity from sales to

Qatar Rail project

– 2012-2020: USD ~70mn

– 2021-2032: USD ~90mn

▪ Low revenue potential beyond Qatar Rail

and within the GCC

– Qatar 2012-2032: USD 0 (TBC if

potential for bus transportation)

– GCC 2012-2032: USD 30 mn (TBC if

27 new metro/rail projects in GCC will

take off and will need ticketing system,

e.g. Damascus/Jeddah)

▪ Industry dominated by players with global

presence providing turnkey solutions e.g.,

Scheidt & Bachmann (DE), Cubic (US),

Vics (AUS), and Indra (ESP)

▪ Negotiations on IPR clauses in contract

needed if local suppliers of spare parts

and maintenance are to step in


Filtered out due to

unclear need for

ticketing system by

Qatar Railways

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118


SOURCE: McKinsey

Provision of district cooling service using the metro infrastructure 130: INFRASTRUCTURE OPERATIONS – UTILITIES AND ENERGY PROVISION


▪ Low ease of capturing

– Suppliers of pipe infrastructure needed

are currently available in Middle East

– Potential redesign needed of

infrastructure to incorporate additional

weight, size and other characteristics of

pipes (e.g. wider elevated structures

and tunnels)

– Impact on rail safety and O&M aspects

to be assessed and weighted against

benefits

– Risk for metro operations low if

incorporated into design and build

plans

– Short lead time as cooling pipes would

be put in place as the rail network is

being built

▪ Medium strategic value for Qatar

– In line with Qatar’s desire to lower

carbon footprint

– Value add to Qatar mainly from

sourcing the pipes for the cooling

infrastructure from local suppliers

(e.g. polyethelene and steel)

▪ Total revenue opportunity from sales to

Qatar Rail project

– 2012-2020: USD ~14 mn

– 2021-2032: USD ~74 mn

▪ Total projected cooling market in 2013 of

USD ~95 mn in Qatar

▪ Total projected cooling market in 2013 of

USD ~1,200 mn in GCC

▪ Qatar Cool key player in Qatar

– Privately owned JV between

Tabreed (UAE) 44%, United

development Company (Qatar) 51%,

and other private investors 5%

– Currently supplies cooling to West

Bay and the Pearl

– Operates two cooling facilities with

capacity of ~200,000 refrigeration

tons (e.g. m3 H2O)

– Plans to build a third plant in WB

▪ Opportunity to leverage metro infrastructure

(e.g. tunnels and elevated structures) to provide

district cooling from cooling plant outside Doha

or from current plant to other parts of Doha

▪ Value add by being able to cost effectively

supply new customers in residential, commer-

cial and industrial facilities outside WB/ Pearl

– No/less need for arranging the

infrastructure (permits, digging)

– Reduced need for cooling facilities/plant in

other regions

– Lower costs due to cheaper infrastructure

(e.g. existing versus new), initial

investments include purchase and

installation of insulated pipe system

– Increased revenue due to accessibility of

more customers

▪ Qatarcool (QC) currently provides cooling only

to the Pearl and West Bay

▪ Key revenue streams for QR are concession

fees and/or rent for use of infrastructure, for

local entrepreneur in selling refrigeration tons

(e.g. m3 of cooled H2O)

Filtered out as feasibility is

unclear due to high technical

requirements (technical

feasibility study required)

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Design, installation and maintenance of solar energy generation

solutions

131: INFRASTRUCTURE OPERATIONS – UTILITIES AND ENERGY PROVISION


– High technical complexity but current

skill set in PV area is medium to high

▫ Company in production of key

input for PV panels, polysilicon,

present (QST)

– Technologies known and proved

– Low risk of impact on metro operation

▪ Medium-high strategic value

– In line with Qatar’s ambition to

decrease dependency on energy from

oil and gas sector and lower carbon

footprint

– Builds on the upstream capabilities in

polysilicon manufacturing

▪ Opportunity to provide solar energy generation

solutions for stations and elevated structures

including design, installation and maintenance

▪ Potentially enormous opportunity in providing

solar energy generation solutions in the desert

▪ Several technologies available of which the

most promising are;

– Standard crystalline

– Thin film (Si)

– Cadmium telluride (CdTe)

– Copper indium gallium selenide (CIGS)

▪ Value added by lowered environmental impact

from using renewable energy sources and by

enabling own energy production

▪ Key revenue streams from equipment sales,

installation and maintenance

▪ Major costs in equipment, to lesser extent in

worker salaries

▪ Key capability to design complete solution


▪ Total revenue opportunity from sales to

Qatar rail sums up to USD ~75 mn:

– 2012-2020: USD ~56 mn

– 2020-2032: USD ~19 mn

▪ Total market in 2011 of USD 28 mn in

Qatar (excl. QR)

▪ Total market in 2011 of USD 559 mn in

GCC (excl. QR)

▪ …


Filtered out due long

payback period (high

upfront CAPEX) and

limited relevance of rail

project as nucleaus

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120

Contents





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121

Potential additional opportunities with relevance for QF or QSTP

Infrastruc-

ture

provision


▪ Manufacture of

innovative/energy efficient light

sources, e.g. LED lighting

▪ Established players already

exist and unlikely that rail will

serve as a big enough nucleus

for investment; no competitive

advantage

▪ Tunnel thermo

insulation

▪ Innovative solutions to reject

heat getting into tunnels in

order to keep them cool

▪ No feasibility and rail does not

provide large enough nucleus

for investment in R&D

▪ Energy efficient

cooling

▪ Manufacture of

innovative/energy efficient

cooling solutions

▪ High cost of entry, very

competitive, insufficient scale to

break even

▪ Thermo insulation

materials

▪ Development of insulation

materials adapted to GCC

climate and needs

▪ Rail does not provide large

enough nucleus for investment

in R&D

▪ Advanced glass ▪ Testing and development of

applications of advanced glass

solutions, e.g. PV-film coating,

better insulation properties.

Probably in co-operation with

glass manufacturer

▪ Rail does not provide large

enough nucleus for investment

in R&D,

▪ Carbon fiber

rebars

▪ Manufacturing carbon fiber

rebars

▪ Energy efficient

lighting



break even


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122

Potential additional opportunities with R&D relevance (1/3)

Rail-related

innovation

▪ R&D and manufacturing of

state-of-the-art hybrid engines

for locomotives to reduce

energy consumption during

transport

▪ Manufacture of

hybrid engines for

locomotives




▪ Manufacture of

innovative braking

elements


state-of-the-art braking

elements to capture and reuse

energy during braking in order

to reduce energy consumption





state-of-the-art lithium battery

engines for locomotives to

reduce energy consumption

during transport

▪ Manufacture of

lithium battery

engines for

locomotives

▪ No feasibility and long-haul rail

does not provide large enough

nucleus for investment in R&D

Description Idea Rationale


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123


Rail-related

innovation

Idea

▪ Rolling stock

energy

optimization

▪ Development of technologies to

enhance produce/manage

energy required by rolling stock

(eg. rooftop solar panels)

▪ OEMs leading innovation in this

area, and incorporating directly

into rolling stock

▪ Plastic fastening

screws

▪ Manufacturing plastic rail

fastenings (screws, pad,

tension washer, rail clamp,

tensioning bolt, baseplate)

▪ Technology still being tested in

NA/Europe, insufficient scale to

break even

▪ Plastic sleepers ▪ Manufacture and supply of

plastic sleepers

▪ Technology still being tested in

NA/Europe, insufficient scale

▪ Advanced paint ▪ Manufacturing of advanced

paints that e.g. help with

insulation, fire prevention, and

structure inspections

▪ No competitive advantage (raw

materials imported) and rail

does not provide big enough

nucleus

Basic

materials

▪ Manufacture and supply of

carbon fiber interior/exterior

lining for rolling stock



break even

▪ CRM / Data

mining

optimization

▪ Carbon fiber lining

for rolling stock

▪ Enhanced CRM system and

data mining capabilities,

potentially through a

partnership with an airline

▪ No feasibility, no competitive

advantage – likely to be run by

Qatar Rail internally

Description Rationale


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124


▪ Manufacture of steel freight

cars and freight car parts

▪ Freight will only begin

operations in the long-term

future Rolling

stock

provision

▪ Established systems already

exist and unlikely that rail will

serve as a big enough nucleus;

no competitive advantage

▪ Passenger

information

system

▪ Provision of passenger

information system for stations,

including real-time updates of

train schedules and delays

Infrastruc-

ture

provision

▪ Automated

vending stores

▪ Provision of automated vending

stores with wide range of food /

groceries at stations

▪ Unlikely that passenger flow will

be large enough to provide

compelling business case; Low

cost of labour makes service

less attractive

Infrastruc-

ture

operations

▪ Specialized rail

cables

▪ Aluminium freight

cars

▪ Manufacture of LV, MV and HV

cables for rail

▪ Insufficient scale to make this

viable

Basic

materials

▪ Silicon ▪ Manufacture of silicone and

silicone grease

▪ No competitive advantage (raw

materials imported) and rail

does not provide big enough

nucleus


Qatar Rail · Appendix A Qatar Rail Civil Engineering Contractors Potential Business Opportunities...

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Transcript of Qatar Rail · Appendix A Qatar Rail Civil Engineering Contractors Potential Business Opportunities...