Market Report on Input based Power Distribution Franchisee Market in India

Brief Summary

Power Distribution Franchisee – evolving Public Private Partnership (PPP) model has picked traction since 2009 after successful demonstration by Torrent Power Ltd. at Bhiwandi, Maharashtra, which got operational in 2007.

The licensee (state utility) appoints a private company on the basis of rationale bidding for distribution of electricity in a specified area for specified years of contract. This Distribution Franchisee model stands midway between licensee and full PPP model and is considered as one of the major energy reforms in power distribution sector that has the potential to turnaround the sector and take electricity to rural areas as well.

Out of the variants available, ‘Input based Distribution Franchisee’ model has recently seen an increase, currently with five cities across India, out of which distribution in three cit

ies was handed over to private companies in 2011. Below shown is the indicative content of the report. Input based Distribution Franchisee, by far, has been mostly used operating model in urban areas.

Investments in this space are driven by the emerging nature of the ‘Input based Distribution Franchisee’ model which promises high returns, has low entry barriers, maintains proximity to end-consumers, involves high Capex with predictable cash flows and easy financial leverage when operating efficiently.

Various experts in power sector are of the opinion that in the coming 5 years, the Distribution Franchisee model is expected to grow manifold, thereby improving the power distribution scenario of the country.

pManifold's Market Research Report on 'Input based Power Distribution Franchisee' in India provides an insights into the current scenario of Power Distribution Franchisee and potential future trends.

Detailed Table of Contents

1. Terminology / Acronyms
2. Executive Summary of Power Distribution Franchisee
3. Power Distribution Scenario in India
• Energy Value Chain & Leakages
• Distribution Scenario
• Why Utilities are making Losses?
• Need for Reforms - Are the Issues with Utility Solvable?
• What is the right model of Utility Privatization?
4. Distribution Franchisee as a Business Model
• Types of Business Models
• Distribution Franchisee Segmentation and Applications
• Why Distribution Franchisee model is attractive over other Privatization models?
5. Input based Distribution Franchisee Market
• Key Drivers
• Distribution Franchisee Projects – Bid Won & Under Implementation
• Model Uptake - Existing Operators
• Competitive Landscape Assessment – Existing Operators
• Future potential: Opportunities & Growth
• Industry Analysis – Porters 5 Forces Model
6. Operating Model
• Stakeholders
• Stakeholders Analysis
• Typical Work Flow Map At Distribution Utility
• Key Challenges With Distribution Franchisee Roll Out
• Model Risks
7. Bid Process and RFP Analysis
• Bid Process
• Evolution of RFPs
8. Financial Model - Using Ujjain city as an example
• Introducing the base Model for Investment Analysis
• Assumed Capex Distribution
• Estimated Returns from base model
• Sensitivity to Input Bid Price
• Sensitivity to Capex
• Sensitivity to Opex
• Sensitivity to Tariff Growth Rate
• Sensitivity to Load Growth Rate
9. Past Bid Analysis
• Connections and Asset information from RFPs
• Customer Segmentation
• Winning Bid Comparison
10. Case Studies
• Bidding Analytics
• Bhiwandi, BSES, NDPL
11. Conclusions
12. References
13. Appendix
• DF Tenders - New and Old Awaiting Decision
• Suggested States for Distribution Franchisee Model by Shunglu Report
• Lists of Distribution Companies, SEB’s in India
• Recent Bid Analysis (Madhya Pradesh – Gwalior, Ujjain and Sagar)
• MP Bids Quick Characterization
• DF Attractiveness Matrix
• Connections and Asset Information from RFPs
• Customer Segmentation
• Utility KPIs

Key Highlights of the Report are

1. Current Market Scenario and Upcoming Opportunities of Distribution Franchisee
2. Key Functional Roles and Responsibility of Distribution Franchisee Operator
3. Key Roll Out Challenges for Distribution Franchisee Operator
4. Case Studies of already existing Operators
5. Competitive Landscape Assessment (CLA) of Distribution Franchisee Operator
6. Financial numbers derived using a base financial model for UJJAIN
7. Sensitivity to different parameters like CAPEX, OPEX, Tariff Rate, Load Growth Rate
8. Bid process description for distribution franchisees

Key Questions Answered

1. What is the potential of Distribution Franchisee model?
2. Which states are looking to adopt the model?
3. What are the key risks and challenges of the distribution franchisee model?
4. How is the bid process and how to analyze information in the RFP?
5. Typical Capex Distribution and Estimated Return?
6. How is the experience of current distribution franchisee operators?
7. How is the current competitive landscape in the distribution franchisee space?

Information Sources

1. Excerpts from industry experts
2. Opinions and Reviews of various reports in Distribution Franchisee sector
3. Inputs from Conferences and Workshops
4. Secondary Research

A Must Buy For

1. Potential New Entrants in Distribution Franchisee space to get up-to speed on the market
2. Existing Distribution Franchisee operators to train / update new hires and stay up to date on market trends
3. Research and Educational Institutes to learn about various aspects of the Distribution Franchisee market
4. Banks and Financial Institutions to learn about the sector and understand the financial implications of investing in distribution franchisee businesses
5. Consultants to upgrade their know-how in the distribution franchisee market space

Pricing:

Rs. 20,000/- (inclusive of taxes)

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