| Dun & Bradstreet's publication series, titled 'Emerging SMEs of India', is the first of its kind and will focus on various important sectors of the Indian economy. The six sectors selected for this series are auto components, textiles, pharmaceuticals, engineering, chemicals and food processing. The publication series will provide informative and reliable reference guides to the emerging SMEs in these segments as six separate publications. |
| Mr. David Emery, President, International Partnerships & Asia Pacific, Dun & Bradstreet, said, "Recent research at the World Bank has re-established that Inability to access finance may be one of the reasons why we do not see a robust correlation between SME prevalence and economic growth. Therefore, the increasing strength of the financial system in the country will help Indian SMEs continue on their growth path. Another important aspect in this journey would be to ensure enhanced global visibility to these SME firms. D&B is confident that this publication series Emerging SMEs of India will go a long way towards achieving this goal. |
| Mr. N Balasubramanian, Chairman & Managing Director, SIDBI and Chairman, SMERA, averred, "The huge size of the SME sector and their occurrence in clusters make cluster based initiatives effective in achieving widespread impact in a shorter span of time. The benefits by banks to offer cluster based financing approach includes lower transaction and monitoring costs through reduction in costs of data, standardization and reduction of documentation; identification of common risk elements and their mitigation; better inter-firm comparison; improved outreach; and design of cluster specific products/interventions." |
| Dr Manoj Vaish, President & CEO - India, Dun & Bradstreet, said "Owing to several factors, SMEs are not able to generate visibility in global markets. This prompted D&B, with support from SMERA, to undertake this exercise of identifying small and medium enterprise and profiling them in a publication that would be distributed through its Worldwide Network. Through the Emerging SME Series, we aim to provide a platform for SMEs in the respective sectors to showcase their strength." |
| Mr. Rajesh Dubey, CEO, SME Rating Agency of India Ltd (SMERA), said "SMEs the world over tend to grow in clusters and India is no exception. In India, there are over 350 clusters besides many minor clusters. Indeed, in order to reach out to the SMEs in the clusters, the need to adopt a "cluster based approach" in financing has been well recognized by banks. Risk profiling of clusters is a step towards enabling cluster based financing by banks. SMERA has taken the initiative and studied risk profile of 4 SME Clusters. The reports would be useful to the commercial banks in their cluster-based financing approach." |
| Excerpts from Dun & Bradstreet 's book on "Emerging Auto Component SMEs of India" |
| The Indian auto component industry is one of the few sectors in the economy that has a distinct competitive advantage in terms of cost and quality. An average cost reduction of nearly 25-30% has attracted several global automobile manufacturers to set base since 1991. Today, India has become the outsourcing hub for several global automobile manufacturers. |
| This unique publication is in recognition of this significant contribution made by the SMEs to India's industrial development. Estimates state that SMEs account for almost 90% of industrial units in India and 40% of value addition in the manufacturing sector. They contribute 35% to India's merchandise base exports. |
| The book profiles 370 companies with a turnover of less than Rs 100 crore. Of the 370 companies profiled, 160 companies are small-scale firms with investments in plant and machinery of less than Rs 5 crore, and with a sales turnover in the range of Rs 5 crore to Rs 53 crore. The remainder are medium scale companies with a sales turnover not exceeding Rs 100 crore. |
| This book provides some rich insights into India's Auto Component SMEs: |
| Companies profiled in the book have been recording robust annual sales growth at an average rate of 35% |
| The most preferred source of funding among the profiled companies was public sector banks. Nearly 66% of the companies preferred banking with public sector banks (PSBs), followed by private banks and cooperative banks. Only 1% of the profiled Auto Component SMEs banked with MNC banks. Approximately 4% of the profiled companies did not borrow at all, preferring to fund their business through internal resources. |
| Only 35% of the companies profiled sold their products under a brand name. This shows that marketing and brand building by Auto Component SMEs will require greater focus in the days ahead. |
| Only 11% of the companies profiled in the sample have entered into joint ventures or collaborations, either with domestic or international companies. Over 50% of the collaborations were for technical purposes, the rest being marketing, production and financial tie-ups. Infrastructure and institutional assistance were cited by the profiled SMEs as two areas that need further improvement. Interestingly, companies from Eastern region cited marketing as their biggest hurdle to growth. |
| An overwhelming 68% of the companies have indicated future plans for diversification, capacity expansion, modernisation and marketing, underlining the confidence of the sector. |
| About Dun & Bradstreet (D&B): D&B (NYSE:DNB), the world's leading provider of global business information, knowledge and insight, has enabled customers to Decide with Confidence for over 160 years. D&B's proprietary DUNSRight™ quality process provides customers with quality information whenever and wherever they need it. D&B manages the world's largest and most valuable commercial database of over 100 million companies. This database updated more than 1.5 million times a day is the foundation of D&B's solutions. |
| Customers use D&B Risk Management Solutions to mitigate risk, increase cash flow and drive increased profitability, D&B Sales & Marketing Solutions to analyse markets, locate prospects and increase revenue from new and existing customers; D&B Export Marketing Solutions to gain significant insight into overseas markets and increase sales; D&B Financial Education Solutions to facilitate professional growth and excellence among their executives and D&B Economic Analysis Group to derive pragmatic and solution-oriented analysis of strategic economic and business developments, thereby aiding informed decision making. For more information, please visit www.dnb.co.in |
| About SMERA "� SME Rating Agency of India Ltd. [SMERA] has been promoted by SIDBI, Dun & Bradstreet, CIBIL and several banks in both public and private sector. The objective of SMERA is to create an enabling environment for availability of quality credit to SMEs by providing transparent, independent third party rating to SMEs. |
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