Description
This is a documentation is about company analysis of Siemens.
SIEMENS - COMPANY ANALYSIS Industry Analysis: E.g. Energy Sector 1. Industry trends: Indian and Global perspectives, recent happenings ? India’s per capita energy consumption is estimated to be about 0.51 tons of oil equivalents (toe). The significantly low value indicates that there is huge potential in India for the growth of energy consumption. ? Result of various initiatives taken by the government, the area under exploration has increased to about 50% as against 11% prior to the implementation of NELP. This has given the boost in exploration & production activities in India. India has evolved as the fifth largest economy in the world in terms of refining capacity, with a share of 3% of the global capacity. By the end of the Eleventh Five Year Plan Period (2007-2012), the refining capacity is expected to reach 240.96 MMTPA. Demand for energy will be growing at a steady rate, so there are opportunities for companies to invest in the country. India has begun to induce various private sector companies including the foreign companies to venture in India. For last 6 years, the installed capacity increased at a CAGR of 5.60%, the peak electricity demand had increased to 109.8 GW in FY09 while the peak demand met increased to 96.7 GW in FY09. India is a nuclear nation after “123 agreement” with US. Now more companies will enter the nuclear power business through partnerships and joint ventures in business segments from equipment manufacturing to fuel supply to generation. Renewable energy business is equally important as India has the requisite resources and this segment is more environment-friendly, and ensures that companies can limit their emissions. GDP growth rate 8% is targeted during the Tenth Five-year Plan, the energy demand is expected to grow at 5.2%. There is need to conserve energy and reduce energy requirements by reducing demand and by acquiring more efficient technologies in all sectors.
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2. PEST Analysis: Political, economic, social and technical aspects related to the industry
PEST ANALYSIS OF ENERGY SECTOR Political: Energy consumption drives Economy and Population. From Industry to household, energy usage is indispensible. Government regulates them by loosening the import/export/tax policies and defining standards. Social: In ever increasing population of world energy usage has increased including industry and household usage. Energy safety is important. Economical: Energy is common need. Inflation rate and RBI’s monetary policies which impacts imports-exports also impacts energy sector. Government decides five year plan which gave importance to energy consumption and usage.
Technological: Energy creation and consumption is chemically inflammable and unstable, it needs skilled labor to handle and highly sophisticated instruments to store and process.
3. Competitor Analysis: Analyze pricing, quality, distribution and partnerships of the nearest competitor of the company ? ? ? ? ? ? Oil & Natural Gas Corporation Limited (ONGC) The Tata Power Company Limited Reliance Infrastructure Limited Bharat Petroleum Corporation Limited (BPCL) Hindustan Petroleum Corporation Limited (HPCL) Indian Oil Corporation Limited (IOC)
4. SWOT Analysis: Strengths, weakness, opportunities and threats faced by the industry
Strength: ? Developing economy: India has huge population, labor force is available. Economy is diversified. It has availability of skilled manpower. India has extensive higher education system, third largest reservoir of engineers. India has done rapid growth in IT and BPO sector. It also has abundance of natural resources ? Weakness: Political turmoil, with numbers of scams getting unfolded, it causes impact on economy and industrial growth. Around 1/3rd of a population is below the poverty line. India has poor infrastructural facilities causing issues in growth in all sectors of industry. Low productivity and huge population is leading to scarcity of resources Low level of mechanization. Opportunities: Energy demands in world and in India are ever increasing so related industry work Energy sector created new projects. India has allowed FDI and government is starting to loosen the policies to increase the profit for the economy. Large amount of India population is youth which can be used for the skilled manpower in the industry. Threats: Global recession has hit the world with European economy crisis. Also presidential election in US has impact on the world economy. Political turmoil creates instability in the industrial sectors.
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PART II Company Analysis: 1. Company description (a brief introduction regarding what businesses the company is into) Back in 1867, Werner von Siemens had personally promoted the founding of the first telegraph line between London and Calcutta. The first Siemens office was established in 1922, and its first assembly plant started operating in 1956. In 1957, Siemens was included as a company under the Indian Companies Act. Today, Siemens India has a sales and service network that covers the country, twenty manufacturing plants, 8 centers of competence and 10 R&D centers. ? It has overall 21 manufacturing plants. Siemens India has wide reputation of being world class solution provider with numerous Sales and Service offices all over India. Siemens India boasts around 1500 partners to serve for them. In India Siemens has performed in three sectors 1. Industry 2. Energy 3. Health Care.
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2. General information about the company: “Location of headquarter, year of founding, shareholding pattern, number of employees, top management, etc”. Company Name: Siemens Siemens is a German conglomerate company (Munich, Germany). It is the largest Europe-based electronics and electrical engineering company. It is organized into five main divisions: Industry, Energy, Healthcare, Infrastructure & Cities, and Siemens Financial Services (SFS). Statistics: ? Siemens has 360,000 employees spread across nearly 190 countries. ? Global revenue of Siemens had crossed approx 71 billion Euros for the year of 2011. ? It is listed on Frankfurt Stock Exchange, New York Stock Exchange since March 12, 2001. Siemens (India): Chairman:”Deepak S Parekh” Directors:“Darius C Shroff”, “Keki Dadiseth”,“Narendra J Jhaveri”,”Pradip V Nayak”. ? ? ? ? The company is active in the India since 1922. It started its first assembly office in Mumbai in 1956, and Siemens Ltd. was included in the following year. Siemens offers many solutions and services in India, where it’s Industry, Energy and Healthcare Sectors are giving high performance. In fiscal 2011, Siemens in India scored major successes in all three Sectors. Siemens currently has about ~18,000 employees in India. Siemens made Investments of EUR 250 million in India from 2010, for the construction of six new factories and manufacture of basic products.
3. Financial performance of the company: Sales, net profit, segment wise performance of the past 1 year ? Energy: 2011 Year ended for Siemens with milestone orders. During the year, new order intake was INR58.16b, down 24%. However, base orders grew 11%, excluding large orders received in Power Generation and Transmission.
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Siemens received several milestone orders. This includes a contract from Torrent Power to install a 1,100MW combined cycle power plant. It also launched a new wind turbine (SWT-2.3-113) for the Indian market. The company is investing INR6b in wind WTG manufacturing and aims to be a key player in India. Sales had grown 42% and profit from operations grew by 1%. Despite tough competition, the company was able to retain its leadership. Siemens is positive on the Energy sector and believes that the government is addressing the key issues of fuel production, linkages and environmental clearances. Siemens is well positioned to capitalize on the opportunities
4. SWOT Analysis: Strengths, weakness, opportunities and threats faced by the company
SWOT ANALYSIS OF ENERGY SECTOR Strength: 1.Diversified business in terms of business segment and geographical presence. 2. Strong research and development capabilities. 3. Reputation in the market. Weakness: 1. Share prices. Increasing debt to equity ratio. 2. Reliance on computer networks in today's risky internet zone. 3. Dependence on raw materials provider. E.g. crude petroleum etc.
Opportunity: 1. Acquisitions and joint ventures to increase growth and profit. 2. Acquiring/winning new contracts in the market. 3. Increase in the customer in energy, manufacturing, healthcare segments.
Threat: 1. Intense competition. 2. Government policies and Environmental regulations to be followed.
5. Various strategies employed by the company in the course of conducting business (in the form of alliances, joint ventures, product innovation/ Expansion strategies, acquisitions/ divestitures and any such strategies that you think may affect the business of the company) in past 2 years. (Make intelligent use of above points while trying to understand the strategies used by the company) a. Hierarchical: At the corporate level, business unit level and functional or department level of the firm b. Business Division: According to various products, divisions, markets, etc. c. Regional: Strategies devised as per regions, geographies, etc. Answer: ? ? Siemens has adopted an investment-led growth strategy in India. Its parent, Siemens AG has identified it as a key partner in its global footprint. In the annual report. Siemens India's Chairman, Mr Deepak Parekh says, "It is significant to note that the company's parent Siemens AG increased its stake from 55% to 75% earlier in the year through an investment of approximately 1 billion Euros. This is a clear message that Siemens Ltd and the Indian market will play a greater role in Siemens worldwide." Siemens India is emerging as a key partner in Siemens AG's global growth strategy. This is vindicated by growing investment by the Group in the country. Over the past 34 years, Siemens India has invested nearly INR10b and plans to invest an additional INR13b-14b over the next 3-4 years. Siemens India has meaningfully benefitted from ongoing infrastructure investments in the Middle East, particularly Qatar. It will continue to do so. Along with Siemens AG, it has bagged orders worth INR95b (Siemens India's share) from Qatar General Water and Electricity Corporation (Kahramaa), Qatar's monopoly power and water distribution company, and a project from Ezdan Real Estate QSC. The company is building on its SMART (simple-to-use, maintenance-friendly, affordable, reliable and timely-to-market) base-level product initiative. Nearly 70% of Siemens' addressable market is in the low and mid market segment, for which the company has developed the SMART strategy. It plans to launch 60 new products, of which 50-60% will be out in the market in the next 12-18 months. During FY11, Siemens launched 10 value-priced products.
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References:
www.dnb.co.in/IndiasEnergySector/Power_Gen.asp www.siemens.com/ www.wikipedia.org www.economictimes.indiatimes.com www.economist.com/node/16990709 www.business-standard.com www.scribd.com www.moneycontrol.com
doc_210811617.docx
This is a documentation is about company analysis of Siemens.
SIEMENS - COMPANY ANALYSIS Industry Analysis: E.g. Energy Sector 1. Industry trends: Indian and Global perspectives, recent happenings ? India’s per capita energy consumption is estimated to be about 0.51 tons of oil equivalents (toe). The significantly low value indicates that there is huge potential in India for the growth of energy consumption. ? Result of various initiatives taken by the government, the area under exploration has increased to about 50% as against 11% prior to the implementation of NELP. This has given the boost in exploration & production activities in India. India has evolved as the fifth largest economy in the world in terms of refining capacity, with a share of 3% of the global capacity. By the end of the Eleventh Five Year Plan Period (2007-2012), the refining capacity is expected to reach 240.96 MMTPA. Demand for energy will be growing at a steady rate, so there are opportunities for companies to invest in the country. India has begun to induce various private sector companies including the foreign companies to venture in India. For last 6 years, the installed capacity increased at a CAGR of 5.60%, the peak electricity demand had increased to 109.8 GW in FY09 while the peak demand met increased to 96.7 GW in FY09. India is a nuclear nation after “123 agreement” with US. Now more companies will enter the nuclear power business through partnerships and joint ventures in business segments from equipment manufacturing to fuel supply to generation. Renewable energy business is equally important as India has the requisite resources and this segment is more environment-friendly, and ensures that companies can limit their emissions. GDP growth rate 8% is targeted during the Tenth Five-year Plan, the energy demand is expected to grow at 5.2%. There is need to conserve energy and reduce energy requirements by reducing demand and by acquiring more efficient technologies in all sectors.
?
?
?
?
?
?
2. PEST Analysis: Political, economic, social and technical aspects related to the industry
PEST ANALYSIS OF ENERGY SECTOR Political: Energy consumption drives Economy and Population. From Industry to household, energy usage is indispensible. Government regulates them by loosening the import/export/tax policies and defining standards. Social: In ever increasing population of world energy usage has increased including industry and household usage. Energy safety is important. Economical: Energy is common need. Inflation rate and RBI’s monetary policies which impacts imports-exports also impacts energy sector. Government decides five year plan which gave importance to energy consumption and usage.
Technological: Energy creation and consumption is chemically inflammable and unstable, it needs skilled labor to handle and highly sophisticated instruments to store and process.
3. Competitor Analysis: Analyze pricing, quality, distribution and partnerships of the nearest competitor of the company ? ? ? ? ? ? Oil & Natural Gas Corporation Limited (ONGC) The Tata Power Company Limited Reliance Infrastructure Limited Bharat Petroleum Corporation Limited (BPCL) Hindustan Petroleum Corporation Limited (HPCL) Indian Oil Corporation Limited (IOC)
4. SWOT Analysis: Strengths, weakness, opportunities and threats faced by the industry
Strength: ? Developing economy: India has huge population, labor force is available. Economy is diversified. It has availability of skilled manpower. India has extensive higher education system, third largest reservoir of engineers. India has done rapid growth in IT and BPO sector. It also has abundance of natural resources ? Weakness: Political turmoil, with numbers of scams getting unfolded, it causes impact on economy and industrial growth. Around 1/3rd of a population is below the poverty line. India has poor infrastructural facilities causing issues in growth in all sectors of industry. Low productivity and huge population is leading to scarcity of resources Low level of mechanization. Opportunities: Energy demands in world and in India are ever increasing so related industry work Energy sector created new projects. India has allowed FDI and government is starting to loosen the policies to increase the profit for the economy. Large amount of India population is youth which can be used for the skilled manpower in the industry. Threats: Global recession has hit the world with European economy crisis. Also presidential election in US has impact on the world economy. Political turmoil creates instability in the industrial sectors.
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PART II Company Analysis: 1. Company description (a brief introduction regarding what businesses the company is into) Back in 1867, Werner von Siemens had personally promoted the founding of the first telegraph line between London and Calcutta. The first Siemens office was established in 1922, and its first assembly plant started operating in 1956. In 1957, Siemens was included as a company under the Indian Companies Act. Today, Siemens India has a sales and service network that covers the country, twenty manufacturing plants, 8 centers of competence and 10 R&D centers. ? It has overall 21 manufacturing plants. Siemens India has wide reputation of being world class solution provider with numerous Sales and Service offices all over India. Siemens India boasts around 1500 partners to serve for them. In India Siemens has performed in three sectors 1. Industry 2. Energy 3. Health Care.
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2. General information about the company: “Location of headquarter, year of founding, shareholding pattern, number of employees, top management, etc”. Company Name: Siemens Siemens is a German conglomerate company (Munich, Germany). It is the largest Europe-based electronics and electrical engineering company. It is organized into five main divisions: Industry, Energy, Healthcare, Infrastructure & Cities, and Siemens Financial Services (SFS). Statistics: ? Siemens has 360,000 employees spread across nearly 190 countries. ? Global revenue of Siemens had crossed approx 71 billion Euros for the year of 2011. ? It is listed on Frankfurt Stock Exchange, New York Stock Exchange since March 12, 2001. Siemens (India): Chairman:”Deepak S Parekh” Directors:“Darius C Shroff”, “Keki Dadiseth”,“Narendra J Jhaveri”,”Pradip V Nayak”. ? ? ? ? The company is active in the India since 1922. It started its first assembly office in Mumbai in 1956, and Siemens Ltd. was included in the following year. Siemens offers many solutions and services in India, where it’s Industry, Energy and Healthcare Sectors are giving high performance. In fiscal 2011, Siemens in India scored major successes in all three Sectors. Siemens currently has about ~18,000 employees in India. Siemens made Investments of EUR 250 million in India from 2010, for the construction of six new factories and manufacture of basic products.
3. Financial performance of the company: Sales, net profit, segment wise performance of the past 1 year ? Energy: 2011 Year ended for Siemens with milestone orders. During the year, new order intake was INR58.16b, down 24%. However, base orders grew 11%, excluding large orders received in Power Generation and Transmission.
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? ? ?
Siemens received several milestone orders. This includes a contract from Torrent Power to install a 1,100MW combined cycle power plant. It also launched a new wind turbine (SWT-2.3-113) for the Indian market. The company is investing INR6b in wind WTG manufacturing and aims to be a key player in India. Sales had grown 42% and profit from operations grew by 1%. Despite tough competition, the company was able to retain its leadership. Siemens is positive on the Energy sector and believes that the government is addressing the key issues of fuel production, linkages and environmental clearances. Siemens is well positioned to capitalize on the opportunities
4. SWOT Analysis: Strengths, weakness, opportunities and threats faced by the company
SWOT ANALYSIS OF ENERGY SECTOR Strength: 1.Diversified business in terms of business segment and geographical presence. 2. Strong research and development capabilities. 3. Reputation in the market. Weakness: 1. Share prices. Increasing debt to equity ratio. 2. Reliance on computer networks in today's risky internet zone. 3. Dependence on raw materials provider. E.g. crude petroleum etc.
Opportunity: 1. Acquisitions and joint ventures to increase growth and profit. 2. Acquiring/winning new contracts in the market. 3. Increase in the customer in energy, manufacturing, healthcare segments.
Threat: 1. Intense competition. 2. Government policies and Environmental regulations to be followed.
5. Various strategies employed by the company in the course of conducting business (in the form of alliances, joint ventures, product innovation/ Expansion strategies, acquisitions/ divestitures and any such strategies that you think may affect the business of the company) in past 2 years. (Make intelligent use of above points while trying to understand the strategies used by the company) a. Hierarchical: At the corporate level, business unit level and functional or department level of the firm b. Business Division: According to various products, divisions, markets, etc. c. Regional: Strategies devised as per regions, geographies, etc. Answer: ? ? Siemens has adopted an investment-led growth strategy in India. Its parent, Siemens AG has identified it as a key partner in its global footprint. In the annual report. Siemens India's Chairman, Mr Deepak Parekh says, "It is significant to note that the company's parent Siemens AG increased its stake from 55% to 75% earlier in the year through an investment of approximately 1 billion Euros. This is a clear message that Siemens Ltd and the Indian market will play a greater role in Siemens worldwide." Siemens India is emerging as a key partner in Siemens AG's global growth strategy. This is vindicated by growing investment by the Group in the country. Over the past 34 years, Siemens India has invested nearly INR10b and plans to invest an additional INR13b-14b over the next 3-4 years. Siemens India has meaningfully benefitted from ongoing infrastructure investments in the Middle East, particularly Qatar. It will continue to do so. Along with Siemens AG, it has bagged orders worth INR95b (Siemens India's share) from Qatar General Water and Electricity Corporation (Kahramaa), Qatar's monopoly power and water distribution company, and a project from Ezdan Real Estate QSC. The company is building on its SMART (simple-to-use, maintenance-friendly, affordable, reliable and timely-to-market) base-level product initiative. Nearly 70% of Siemens' addressable market is in the low and mid market segment, for which the company has developed the SMART strategy. It plans to launch 60 new products, of which 50-60% will be out in the market in the next 12-18 months. During FY11, Siemens launched 10 value-priced products.
?
?
?
References:
www.dnb.co.in/IndiasEnergySector/Power_Gen.asp www.siemens.com/ www.wikipedia.org www.economictimes.indiatimes.com www.economist.com/node/16990709 www.business-standard.com www.scribd.com www.moneycontrol.com
doc_210811617.docx