Cleaning Market in the ‘Heart of India’

While Gujarat has been a focus for businesses over the last two years, another fast growing region that has been drawing attention in the ‘Heart of India’ is the North-Central region of India. The BIMAROU (Bihar, Madhya Pradesh, Rajasthan, Odisha and Uttar Pradesh) States have in fact attracted huge investments in infrastructure and industrial sectors, including automobile, manufacturing, food processing, cement, and others. This region, thus holds immense market potential for cleaning & hygiene, waste & pest management and FM-soft services. Suprita Anupam reports on the potential market of Madhya Pradesh.

The north-central (NC) region, which houses around 30% of the country’s cement plants, is fast becoming a hub for automobile, pharma, healthcare, hospitality, IT and other industries. Currently, 23% of large automobile plants and 16% of the auto and ancillary units are based in NC region. Over Rs.679,000cr investment plans for Madhya Pradesh over the next few years was announced at the
recently concluded Global Investment Summit 2014, Indore. With top companies having presence in the NC region and huge investments in the pipeline, the cleaning & hygiene industry is poised for a substantial boost with over 70% of the cleaning market still untapped.

The future scenario can better be understood by one example. NTPC and Reliance have been working on their Rs. 20,000cr and Rs.25,000cr investment plans in Madhya Pradesh; NMDC and NALCO too have announced to set up thermal power plants at a
cost of Rs.22,000 crore… These major investments itself is supposed to create a Rs.100cr business window for the cleaning segment.

The State offers a number of fiscal and policy incentives for businesses under the Industrial Promotion Policy, including
single window clearance policy.

Vibrant Base
• Major auto manufacturing base
• Largest producer of radial tyres in India
• Largest soya processing hub in India
• FMCG consumer electronics hub
• Hub for pharmaceutical and herbal products
• Rapidly growing textile and apparel hub
• A growing gems and jewellery centre

In 2013-14, the investments made in the State were to the tune of US$94.5 billion.

In 2014, while the Pharma Industry registered a growth rate of 10.9%, MP showed one of the highest at 19.3%. More than 300 medium and large scale companies and 12 mega projects are either running or are under construction phase.

Pithampur Industry Area
Total Companies: 2000 approx.
Running: 1386
M/L: 312
Mega: 12
Under Construction 143
M/L: 7
Mega: 11
Crystal IT Park Indore SSI: 10
Electronic Complex: 112
SEZ
Total: 66
M/L: 55
SSI: 10

Accounting 14% of the State production, MP is one of the largest producers of cement. The cement industry is also the second largest emitter of CO2. The cement industry is constantly under pressure to reduce the emission with better equipment installation and housekeeping services. Major players are Kymore Cement Works; Birla Vikas & Satna Cement Works; Cement Corporation of India Ltd- Nayagaon; Cement Corporation of India Ltd-Mandhar; Century Cement – Mahiar; Heidelberg Cement
India Ltd- Damoh; Jaypee Cement – Bela; Jaypee Cement – Rewa; Jaypee Cement – Bhilai (clk); Jaypee Cement – Sidhee; K. J. S. Cement Ltd; Prism Cement Ltd. – I & II and UltraTech- Vikram Cement Works.

Manufacturing a variety of products for the Indian Armed Forces, the State has six Ordnance Factories with four located at Jabalpur, Vehicle Factory, Grey Iron Foundry, Gun Carriage Factory and Ordnance Factory at Khamaria Katni and Itarsi.

Indore

Pithampur Special Economic Zone and Sanwer houses in Indore have leading large, medium and small scale manufacturing and service industries, ranging from Automobile to Pharmaceutical and from Software to Retail and from Textile trading to Real estate. Pithampur has a presence of over 2000 pharma units, including those of Ipca Laboratories, Cipla, Lupin, Glenmark and Unichem.

• Registered Industrial Units 12,726
• Total Industrial Units 12,726
• Registered Medium & Large Units 21

National level Real Estate Players such as DLF, Omax, Sahara, Parsvnath, Ansal API, Emaar MGF have big projects at Indore bypass. Among the regional players, Silver Spring, Kalindi and Milan Heights have also their projects in nearby areas.

IBM, Impetus, TCS and Infosys are among the top IT/ITeS firms having their campus in Indore.

A number of Industry clusters have been formed in the city to promote the segments in right balance.

Pharma Cluster
SPV: MPPMO Analytical & Research Centre, Indore
No. of functional units: 300
Turnover: 3200 crores
Employment: 20,000

Present status: About 105 units have complied with GMP Norms and registered an increase in production of 58%. Exports have increased appreciably from Rs.19.3 crores to 120 crores.

Readymade Garment
SPV: Malwa Apparel Park Ltd, Indore
No. functional units: 1475
Turnover: 850 crores
Employment: 60,000
Present status: SPV has been formed & Apparel training Centre established. Turnover increased from 600 crores to 850 crores and export has rose from 50 crores to 70 crores..

Namkeen
SPV: Indore Namkeen & Mishthan Cluster
No. of functional units: 350 Turnover: 450 crore
s
Employment: 12,000

Present Status – Soft interventions have been completed.SPV has been formed. It is selected as innovative cluster.

Rechargeable Torch Cluster
SPV: Rechargeable Torch (Kissan Torch) No. of functional units: 100
Turnover: 200 crores Employment: 9,000

Present Status: Soft interventions have been completed. SPV has been formed & DPR has been prepared by Nagar & Co Plastic Packaging SPV: HDPE Pipes, Woven Sacks, Films & Plastic Bags No. of functional units: 135 Turnover: 2500 crores
Employment: 31,000

Present Status: DSR has been prepared. SPV formation is under progress.

Gwalior
Gwalior is strategically located in MP with direct accessibility from both north and south India, is surrounded by large industrial areas of Sitholi, Banmore and Malanpur. Gwalior is now fast becoming a hub for dairy, chemical, manufacturing, and textile industries. Having forts and other historical places to visit, it is also tourists’ favourite destination.

• Registered Industrial
Unit No. 15455
• Total Industrial Unit No. 15455
• Registered Medium & Large
Unit No. 11
• Employment in Large and Medium Industries No 3318

Bhopal
The capital of MP also houses several industries.
• Registered Industrial Units 10989
• Total Industrial Units 12400
• Registered Medium & Large Units 19

Sectorewise:
Automobile & Engineering
• Largest producer of radial tyres in India
• Presence of an Indo-German tool room (an initiative between Govt of India and Federal Republic of Germany)
• Dedicated Pithampur-Indore Auto Cluster
• Strong presence of OEMs and auto parts manufacturers
• Building a world-class racing & testing track at Indore
• Availability of skilled manpower and robust infrastructure
• Regulatory support and special incentives for investment in automotive centre Some of the big players in these segments are Mahindra & Mahindra; Eicher Motors; Hindustan Motors; Tafe Tractors; Man Force Trucks Pvt Ltd; and CNH Industrial among others.

“It is articulated on the premise that the current enabling environment will be further strengthened and enhanced by encouraging private investment, by improving the legal and administrative systems and by promoting partnerships.”

– Shivraj Singh Chauhan
Chief Minister, MP

Advantage MP

Logistic Advantages
Procter and Gamble took a strategic decision in the year 2000-2001 to locate Central Warehouse at Bhopal for its entire FMCG products. In the year 2003-2004, the company was able to reduce the prices of its brands because of the Logistic advantage offered by its economical warehousing activities at Bhopal. Many FMCG Companies are now relocating their wares to Madhya Pradesh.

Fiscal Advantages
A promotional assistance equivalent to 50-75% of the Commercial Tax and Central Sales Tax deposited in the first year shall be given in the second year. This promotional assistance shall be given for 3-10 years depending upon the category of the district and the amount of investment shall not be more than the total investment of the installed unit.

Hotels & Hospitals
Being one of the top tourism destinations in India, leading hotels have their operations in Madhya Pradesh – Radisson Blu , Ramada, Radisson, Khajuraho, Usha Bundela, Baghela Resort, City Palace and Syna Tiger Resort among others. Big hospitals with world class facilities too are established in Dewas, Gadarwara, Gwalior, Hoshangabad, Indore, Jabalpur and Katni.

While Siesta Hospitality Service Ltd has planned to set up a hotel in Indore with capacity of 100, Ramee grand, 5-star hotel is also listed in Ramee Groups’s upcoming project in Indore.

Apollo Hospitals recently launched at Indore, a 125 bedded super-specialty hospital with over 50 specialties and super-specialties, “We are humbled with the opportunity provided by the State to help us serve them with advanced medical care and patient management that stands unparalleled till today. This is only the beginning of our journey in Madhya Pradesh and we are looking forward to adding more facilities in Indore and Bhopal,” said Prathap C Reddy, Chairman, Apollo Group of Hospitals.

IT-ITES
The IT-ITeS sector in MP has emerged as an important contributor of almost 27% of
State exports. Focus of the government in developing use of information technology for all round development as envisaged in the Madhya Pradesh’s IT vision is likely
to aid the growth of IT-ITeS sector within the state. The state has one of the highest optical fibre coverages in the country with more than 24,000km of optical fibre backbone covering all of its 313 developmental blocks across 45 districts.

The development of proposed IT-SEZ and IT parks, which would create essential infrastructure for the sector, is expected to fuel the growth in the state. Some of the proposed investments in the sector are enumerated below:

• 21 IT-SEZs have been permitted in the state

• Four Software Technology Parks (STP units) are proposed to be set up in Bhopal, Indore, and Gwalior.

• MOUs worth Rs.77bn with 20 companies for investment in IT sector in the state Mega State Projects

• Setting up an air cargo hub at Indore, for which 500 hectares of land would be acquired near existing Devi Ahilyabai Holkar

Airport.

• Reliance Anil Dhirubhai Ambani Group will enhance its integrated power plants in Madhya Pradesh at an investment of R.25000Cr.
• HUDCO to invest Rs.2,000Cr to strengthen urban water supply and urban infrastructure development schemes.
• MTech Metals & Mining has inked MoU to invest Rs.9,000Cr in an integrated steel plant and an auto park to be set up in Jabalpur division.
• Future Group plans to invest Rs.2,500Cr for an integratedfood park and to create jobs for 21,400 people.
• Vellore Institute of Technology plans to invest Rs.500Cr to set up a university in the state.
• Bharat Forge will invest Rs.1,880Cr to set up a steel plant at Shahdol and auto-component plants near Indore.
• Tata Consultancy Services will invest Rs 410Cr in Indore to create 12,000 jobs.
• Steel Authority of India Limited plans to invest Rs 5000Cr in an iron plant at Chhatarpur.
• Stem Learning Ltd plans to invest Rs.80 crore to train 20,
  000 students
• Rockland Hospital will invest Rs.300Cr in a super-speciality hospital.
• NTPC has inked an MoU to invest `9000Cr to set up a 1,200 MW thermal power station at Khargon.
• American Copper Limited plans to invest Rs.1856Cr in a 500 metric tonnes per annum copper plant in Balaghat Upcoming Infrastructure Projects.
• Apparel, Pharma and Food Processing cluster at Indore.
• Readymade Garment Park, Multi-Product Industrial and a Leather Complex at Gwalior.
• Food Processing Cluster at Shivpuri
• Plastic Park & Multi Product Industrial Area at Bhopal
• Flatted Industrial Complex and Convention Centre at Jabalpur
• Proposed Gems and Jewellery Park & Convention Centre at Indore
• 1000 MW Gas-based Power Plant at Guna by DMICDC

Investment opportunities

• Assembling and manufacturing of automobiles and auto components
• Setting up of centres of excellence like automobile design centre, R&D facilities, industry-specific training centres
• Infrastructure development in the form of Auto & Ancillaries Park and Machine Tools Park
• Auto financing and vehicle retailing.

 

With inputs from MSME-Development Institute,
investmp.com and ibef.org