Insurance

To provide insurance, insurance companies charge a premium, which is the price for the insurance.
These premiums are the money the insurance company receives from its customers.
Typically, the maximum amount the insurance company will pay is stated in the policy. These payouts
represent expenses to the insurance company.
Work on concept of Shared Risk
Because claims are not filed on any sort of regular timetable, there are times when the insurance
company will have more cash come in reserve than it needs to pay claims.
This money is not profit. Is is simply being held to pay expenses later.
An insurance company's reserves are not held in a savings account. Rather, the insurance company
invests those reserves. If the insurance company makes a positive return on those investments, then
that money would be a profit.
The combination of charging profitable premiums, plus making money on invested reserves, is how an
insurance company makes money.

Healthcare

Public sector spending 25%

Private sector 75%
Drivers of growth for the Healthcare Sector

Demographic factors:
Increase in Population: Expected increase in population from about 1.1 billion in 2009-2010 to 1.4
billion by 20264
Shift in demographics: 60 percent of the population in the younger age bracket and an expected
increase of geriatric population from current 96 million to around 168 million by 2026. This represents a
huge patient base and creates a market for preventive, curative and geriatric care opportunities
Rise in disposable income: Households in the above INR 200,000 per annum bracket can benefit
from an increase in disposable income from 14 percent in 2009-2010E to 26 percent in 2014-2015P
making healthcare more affordable
Increase in incidence of lifestyle-related diseases: There is likely to be a marked increase in the
incidence of lifestyle-related diseases, such as cardiovascular, oncology and diabetes, when
compared to the communicable and infectious diseases
Rising Literacy: Growing general awareness, patient preferences and better utilisation of
institutionalised care as a result of increase in literacy rates7
Economic factors:
Tax benefits: Lower direct taxes, higher depreciation on medical equipment, income tax exemption
for 5 years to hospitals in rural areas, etc. are being provided by the Government to the sector8
Medical Tourism: India emerging as a major medical tourist destination with medical tourism market
expected to reach USD 2 billion by 2012
Insurance coverage: Increase in health insurance coverage with a number of private players and
foreign players entering the market to cater to increased demand. The sector is expected to see and
increase in the penetration from the current 10 percent-15 percent to almost 50 percent at a CAGR of
24 percent.
Revenues
An average corporate hospital takes a minimum of 18 months in the making and a
minimum of three to five years to break even.
Company executives point out that even in a hospital set up around 75 percent of revenue is finally
made from the surgeries
Sources of revenue
1. Surgeries
2. OPD consultation
3. Day care
4. Emergency care
5. Diagnostics (X ray etc)
6. Medicines
7. Ayurveda and wellness services
Cost factors:
1. Capital assets (hospitals have high capital investment requirement)

2. Salaries and fringe benefits

3. Delayed payments
4. Maintenance
5. Electricity and Fuel
6. Charity activities (free care for some patients)
7. Opportunity cost of un-used beds

Cost factors (another source):

Performance indicators
1. ALOS (Average length of stay) - The lower the value, the more efficient a hospital is
2. % Time that hospital beds are occupied

Pharma
The Indian pharmaceutical market is one of the fastest growing markets in the world; sales increased by
17.5% to $7.3 billion in 2006.
Overall, the domestic pharmaceutical industry is highly fragmented; more than 10,000 firms collectively
control about 70% of the market. Only three foreign multinationals rank in the top 10 companies, as
measured by sales, and collectively they have only 11.9% of the market between them. But many of the
local players are generics producers specializing in anti-infectives, and as the illnesses of affluence and
age increase, the demand for innovative new pharmaceuticals will rise.

Strengths
India's key strengths such as low-cost manufacturing, high process chemistry skills, manufacturing facilities
and increasing number of drug master filings (DMFs) are expected to drive growth in bulk drug exports.

Growth Drivers
Increasing drug R&D costs in compared to India
Enhanced healthcare investments in developing countries
Healthcare reimbursement issues in the U.S. and Europe
Scientific breakthroughs in genomics and proteomics
Increasing cost and commercialization pressures in other nations
WTO patentend forcements, and several other industry dynamics

Costs
Fixed costs: Land, plant and machinery, maintenance
R & D costs
Variable costs: Raw materials, distribution costs (Medical reps) + Doctor incentives, labor costs, cost of
purchasing patents
Barriers to Entry
:: economies of scale - manufacturing, R&D, marketing, sales
:: distribution product differentiation - established products, brands and relationships
:: capital requirements and financial resources
:: access to distribution channels: preferred arrangements
:: regulatory policy: patents, regulatory standards
:: switching costs - employee retraining, new equipment, technical assistance
Alternate Revenue Sources
1. Contract research
2. Bio pharma
3. Contract manufacturing
4. New drug development

Airlines

 Passenger load factor- a measure of the amount of utilisation of the total available capacity
of a transport vehicle.
Aircraft Utilization: The most basic metric for an airline is aircraft utilization. This is a
measure of the average number of hours that each aircraft is flying in each 24 hour period.
Variable costs would include aircrew salaries, fuel, landing fees, and passenger refreshments.
Most factors that affect the profitability of airlines are fairly stable, except for fuel costs
Airlines can lease airplanes, airport gates and other property. The capital investment in
airways and airport infrastructure is borne by governments. As a consequence airlines have
lower fixed costs, but higher variable costs.The cost of operating a flight will be the same
whether the flight is full of passengers or empty, but the income from that flight is
proportional to seats sold. This leads to overbooking and highly discounted seats if several
remain unsold in the days before the flight as a money losing fare is better than no fare at
all.
Costs include flight operations (fuel, pilots), maintenance (parts and labor), station expenses
(handling passengers, luggage and freight at terminals), promotion (advertising, reservations
and travel agent commissions), passenger services (food and entertainment), administration,
equipment depreciation and amortization and transport related (delivery trucks).
Airline revenue comes from carriage of passengers, cargo, mail, and contracting services. To
maximize the number of passengers on each flight airlines utilize complex computer
programs that try to forecast discount versus full-fare ticket demand.
80% of Indian traffic in domestic segment

 Business travel is important to the commercial airline industry for two major reasons. First, it
commands a much higher average ticket cost, approximately 5 times higher than the average
leisure fare. Second, business travel is less elastic changes in macro-economic trends than
leisure travel
Growth Drivers: High GDP growth, Lower oil prices, untapped domestic markets, Rise in
tourist travelers, Rise in high value imports and exports
FMCG
Definition
FMCG items are those which generally get replaced within a year. Examples of FMCG commonly include
a wide range of repeatedly purchased consumer products such as toiletries, soap, cosmetics, oral care
products, shaving products and detergents, as well as other non-durables such as glassware, bulbs,
batteries, paper products, and plastic goods. FMCG may also include pharmaceuticals, consumer
electronics, packaged food products etc.
Growth Drivers
1. With a median age of 25 years, increasing numbers are joining the Indian workforce. Income in the
hands of younger consumers with a higher propensity to spend, is providing optimism to the economy
while opening up new categories in the FMCG space.
2. India is under changing phase as more women are joining India's workforce, FMCG players are finding
opportunities to introduce products in the convenience and health foods segments. While spending on
women's personal care products is also becoming far more acceptable.
3. Distribution of smaller pack sizes, innovations like single use sachets to reach out to the rural and
lower section of the economy is gaining demand. Innovative products to cater to regional or local tastes
and the needs of niche consumers is also benefiting in growth of the industry.
Key growth drivers to the Industry are as follows:
1. Robust growth in Indias GDP
2. Growing urbanization
3. Evolving consumer life style
4. Increased income in rural areas
5. Spending Pattern
6. Changing Profile and Mind Set of Consumer

Cost Factors
1. Raw Materials - 15%
2. Packaging - 15%
3. Manufacturing - 24%

4. Logistics - 6%
5. TDC margin - 40%
Financial Services- Retail Banking, Credit Cards, Insurance
Automotives

Media

Metrics used within the Digital Media Performance Measurement Framework will primarily be
quantitative but will also employ other inputs to contextualize audience success
Selling and purchasing news- revenues and costs
Five Standard Metrics
Unique individuals: An individual, identified by a visitor ID, username, subscriber ID, etc. counts as a
unique individual only once in the reporting period, no matter how many times he accessed the content
within that timeframe.
New individuals : The number of unique individuals (i.e. visitors, players, viewers, etc.) who consumed
content for the first time during the reporting period.
Sessions: The number of times a unique individual accessed content during the reporting period. A
single session generally lasts until the user stops accessing the content by closing an application, closing
the browser or navigating to another page, turning off the game console, etc.
Downloads, Streams, Video Starts, User Actions, Page Views :The number of times an individual
viewed, downloaded, streamed, played, or took another action to advance content.
Time Spent: The total time spent consuming content by a unique individual across all sessions and all
content segments within the reporting period.
Key Performance Indicators (KPIs)
KPIs related to reach:
Percentage of total audience
Percentage of new users
KPIs related to consumption (usage): Consumption is the total number of combined interactions with
content over a given period of time.
Average content consumption per session: The average amount of content an individual consumes
within a single session. This may be measured by page views per visit (website), video starts per visit,
streams per visit, downloads per unique individual, etc.
Average time spent per session: The average amount of time (usually minutes) an individual spends
consuming content within a single session. A project may increase consumption by encouraging users to
spend more time per session consuming (and engaging with) content.
Goal completion rate:The average number of times an individual took an action to begin consuming
content expressed as a percentage of the number of times a user could have consumed content.
Latency (days before first goal completion): The time (in days) an individual accesses the content
delivery method before taking an action to consume content. Low latency (users consuming content the
first time they access the content delivery method) is an indicator of more engaging content, signalling
higher levels of consumption.

Recency (days since last session):The time (in days) between an individuals last two accesses to the
content delivery method(assuming they are accessing the same content delivery method). High
recency is an indicator of more engaging content, signalling higher levels of consumption.

IT
Real Estate
Mobiles
Public Utility

Telecom:
Heavy barriers to entry and exit: Entry- Capital Requirement; Exit- Specialized
Equipment, difficult to liquidate. Moreover, these equipments become obsolete rapidly
EBITDA used as an indicator of a company's financial performance. EBITDA provides a
way for investors to gauge the profit performance and operating results of telecom
companies with large capital expenses. Many companies have little or no earnings to
speak of. Hence, removing depreciation gives a good indicator of company health
Churn Rate: The rate at which customers leave for a competitor. Largely due to fierce
competition, the telecom industry boasts - or, rather, suffers - the highest customer
churn rate of any industry.
Average Revenue Per User (ARPU): Used most in the context of a telecom operator's
subscriber base, ARPU sometimes offers a useful measure of growth performance - have
gone down significantly due to price wars and tariff cuts
Telephone density or teledensity is the number of telephone connections for every
hundred individuals living within an area.
MOU(Minutes of usage): Average communication time per one month per one user
Subscriber acquisition cost is a metric that is primarily used by companies that offer
some sort of subscription based service, like telecommunications companies or cable
television providers.
Termination charge: Mobile termination charges are paid by the mobile operator on whose
network the call originates to the operator on whose network the call terminates.

Department of Telecommunications has divided India into various cellular zones such
that within each zone, the call is treated as a local call, while across zones, it becomes a
long-distance call. A cellular zone (or telecom circle) is normally the entire state, with a
few exceptions

 On account of high prevalence of the multiple-SIM phenomenon and high churn rate in
urban areas, it is estimated that the urban regions, especially the metros, have a much
higher proportion of inactive subscriber base than the industry average
Growth Drivers: Favorable factors such as policy moves of the government, tax
incentives offered, a large talent pool in R&D and low labor cost all provide a strong
impetus to the industry, newer telecom technologies like 4G services, better devices,
changing consumer behaviour and the emergence of cloud technologies.
The market share of the telecom companies reflects the fragmented nature of the
industry, with as many as 15 players. While the private operators hold 88.60 per cent of
the wireless market share (based on subscriber base) BSNL and MTNL, the two PSU
operators capture 11.40 per cent of the pie.
India today- ~ 900 million wireless subscribers (700 million active subscribers- a number
that receives or makes one voice call a month)
GSM/CDMA Number of telecom towers in India ~ 5 Lakh

Retail
Costs : Main cost is COGS.
Fixed start-up Costs: Mortgage or Lease Deposit, Inventory, Insurance, Store Fixtures, Signs &
Equipment, Office Supplies & Store Use Items, Professional Fees (Legal &Accounting), Licenses,
Permits & Registration Costs, Utilities Deposits/Connection
Monthly operating costs: Rent/Mortgage Payment, Inventory (warehouse etc), Loans, wages,
advertising/ marketing, insurance, equipment lease, utilities, transportation.
Revenue: Sales, memberships
The key metrics for retail business are as follows:
Sales increase How much sales increase for the same store from one month to next
and year over year. In retail businesses this is also known as sales comp (comparison of
sales)
Gross Margin Total revenue minus purchase cost (COGs or amount paid to purchase
the merchandise). The gross margin shows how much price premium you are able to get
from customers as well as how cheaply you can buy your goods.
Inventory turnover Shows how fast you are selling the goods. It is calculated as
total sales for the year divided by average inventory. For example, if your total annual
sales is $500,000 and average inventory is $100,000; the inventory turnover will be 5;
which means you are turning over your inventory five times a year. Higher inventory
turnover is desired for retail business.
Repeat Customers High repeat customer count shows that your customers like what
you are selling and they keep coming back to your business for more. You can show this

metrics either as % of total sales from repeat customers or % of total customers that are
repeat.

Growth drivers: Changes in demographics, Rising income levels, Changes in consumer needs,
attitudes and behaviour, Increased credit friendliness, Increasing awareness of Indian
consumers
Growth in Indian retail has been driven by the country's economic fundamentals over the past
few years. Increasing number of nuclear families, easy financing options, increase in the
population of working women and emerging opportunities in the service sector during the past
few years have been the key growth drivers of the organised retail sector in India. Consumers
are now showing a growing preference for organised retail, resulting in increased penetration.
The retailing sector is at an inflexion point where the growth of organised retailing and growth
in consumption by the population is expected to take a higher growth trajectory. Going
forward, we believe that accretion to income levels of the rising Indian middle class
(represented by the financially independent young population) and the consequent rise in
disposable incomes will fuel growth of the retailing sector.

In retail, sales per unit area is a standard and usually the primary measurement of store success.

Cement:
Annual Indian demand ~ 200 million tonnes - from housing, infrastructure, commercial
construction, industrial demand; housing constitutes 60%. Within infrastructure (25%),
major part is for roads (33%)
Barriers to entry- high capital requirements, long gestation period, availability of raw
material
Raw material government regulated- long time for issuance of licenses
50Kg bad costs ~ Rs 250
Process: Limestone and clay blasted from quarries -> Manufacturing process -> Stored in
silos -> Packed in bags -> Shipped through rail, road or sea
Has a business cycle of 7-8 years
Costs- The cement industry is dependent on three major infrastructural sectors of the
economy coal, power and transport. The inputs from these three sectors account for
roughly 50 percent of the cost of cement. Coal availability and quality is a main problem. On
account of sufficient reserves of raw materials such as limestone and gypsum, the raw
material costs are not very high. One additional external influencer of the cement industry
performance is the taxes imposed by central and state governments. cement industry is a
very capital intensive industry.This also account for the huge depreciation and interest costs
that accrue on the plant and machinery. Moreover the labour employed is essentially semiskilled, excluding the top management, which brings down labour costs.

Cement being a high volume low value commodity results in high freight costs, which makes
cement imports economically unfeasible
Growth Drivers- Govt boost to infrastructure development, demand from housing segment

Infrastructure
The Planning Commission has projected that investment in infrastructure would almost
double at US$ 1,025 billion in the Twelfth Five Year Plan (2012-17), compared to US$ 514
billion in the Eleventh Plan. Of the US$ 1,025 billion, 50 per cent is expected to come from
private sector, whose investment has been 36 per cent in the Eleventh Plan.
Includes Aviation, Ports, Power, Real Estate, Roads, Railways
Aviation: From 2012, FDI (upto 49%) from foreign airlines allowed in aviation; Growth
drivers- boom in tourism; 16 per cent CAGR during 2010-2013; The total number of airports
or airfields recognisable from the air is 352; Buoyed by the success of implementation of
public private partnership (PPP) model in airport development, the Government plans to
invest US$ 30 billion in next 10 years with more existing airports being opened up for
modernisation.The capital expenditure is funded through private equity, borrowings, and
internal resources of joint venture companies
Ports: About 95 per cent by volume (more than 1 billion tonnes) and 70 per cent by value of
the country's international trade is carried on through maritime transport. India has a total
of 187 minor ports and 13 major ports spread across the nine maritime states;In the 12th
Five Year Plan the Government of India has proposed to invest INR 73,793.95 crore for
development of various projects in port sector
Power: Initiatives include increasing installed electricity infrastructure, the New Exploration
and Licensing Policy for increasing the production of oil and gas, and the nuclear sectors
recent embrace of international companies to provide equipment and related services; The
electricity sector in India had an installed capacity of 207.85 Gigawatt (GW) as of September
2012, the world's fifth largest.[1] Captive power plants generate an additional 31.5 GW.
Thermal power plants constitute 66% of the installed capacity, hydroelectric about 19% and
rest being a combination of wind, small hydro, biomass, waste-to-electricity, and nuclear.
Railways: third largest railway network in the world with 7,083 railway stations; Railways
operates 19,000 trains each day, comprising 12,000 passenger trains and 7,000 freight
trains; It currently has 1.36 million employees; Aims is to add 25,000 route km to the
railway network; 34 of the total 65,000 km route length is electrified
Roads- India has about 4.2 million kilometres of road network, which is the second largest
in the world. About 65 per cent of freight and 85 per cent passenger traffic is carried by the
roads; National Highway Development Project- Golden Quadrilateral; North South & East
West Corridor;

Steel: