I guess it was C. K. Prahalad who talked about opportunity in serving poorest of poor, bottom of pyramid. As India grows and per capita income increases, a huge opportunity lies in businesses who serve villages.

 

I feel this is one theme which seems coming true and this is one of the places where we can look for next multi-beggar. Biggies like ITC and HUL are already working on this front. However, I think it is obviously better to look at smaller companies who could take advantage of platform created by these two biggies.

 

Already some companies are being discussed here like Shriram city union by Devesh and Relaxo footware by Amit. I looked at Atlas cycle and Khaitan electrical but while looking at financials could not find enough to go for further review and posting at TED.

 

Other one which nicely fits in and widely discussed on TED is Hawkins cooker.

 

I suggest members could give their own list of small and mid size companies which could fit in this theme and those ideas can be explored further for collective benefit.

Edited by Monkey - 08/Jan/2010 at 12:53pm

Originally posted by basant Around 1.2 crore people get added to the consuming class each year by moving to above the poverty line. This is a huge number!

One has to think about things people above poverty line need:
1. Low cost housing-- sintex, hyderabad,visaka inds etc
2. TVs and satellite tv--dish only listed player, for tv, lots of competition
3. FMCG items-- lots of companies
4. Footwear and underclothing--relaxo,page,maxwell
5. Drinking water-- water tanks-- again sintex
6. Vehicles-- cycles and two wheelers (auto ancillary to two wheelers could be big bets-- might be cheap currently also)
7. Microfinance and banks-- smaller regional banks, nbfcs as mentioned earlier like shriram
8. Clothing-- cheap value for money clothing -- the one that immediately comes to mind is koutons-- it needs to prove itself.
9. Food-- Agri product companies catering to lower income group -- ?? non Basmati players-- lakshmi energy
10. Healthcare-- affordable healthcare--no players, but focus can be on domestic centred pharma player with good leading brands like alembic, fdc, ajanta pharma etc.

From the above topics I think the auto ancillaries specifically catering to two wheelers could be the best bet.

Exhaustive list but I have a slightly different thought here a person moving into the consumption basket will prefer cheap unbranded goods. For instance Koutons could be the second or third level change for him the first would be the roadside shop!

Husing finance is a good bet; FMCG like Nestle, GSK COnsumer, Two wheelers etc are good options.

I doubt whether he will suddenly start using jockey or buy jewellery from the Tanishq showroom or buy Fast track watches or sunglasses but surely he will graduate to that level in a few years in other words the person who broke into that league in 2000 is doing that right now so this is an evolving process but the raw material is comung from the 1.2 crore guys who can stand up each year and say "I am proud of myself".

The big theme would be urbanization and anything related to urban infrastructure! The development of several new Nasiks, Punes, Mangalores, Gurgaons and Noidas over the next decade is the big area of development.

Originally posted by hit2710 Originally posted by basant Around 1.2 crore people get added to the consuming class each year by moving to above the poverty line. This is a huge number! One has to think about things people above poverty line need: 1. Low cost housing-- sintex, hyderabad,visaka inds etc 2. TVs and satellite tv--dish only listed player, for tv, lots of competition 3. FMCG items-- lots of companies 4. Footwear and underclothing--relaxo,page,maxwell 5. Drinking water-- water tanks-- again sintex 6. Vehicles-- cycles and two wheelers (auto ancillary to two wheelers could be big bets-- might be cheap currently also) 7. Microfinance and banks-- smaller regional banks, nbfcs as mentioned earlier like shriram 8. Clothing-- cheap value for money clothing -- the one that immediately comes to mind is koutons-- it needs to prove itself. 9. Food-- Agri product companies catering to lower income group -- ?? non Basmati players-- lakshmi energy 10. Healthcare-- affordable healthcare--no players, but focus can be on domestic centred pharma player with good leading brands like alembic, fdc, ajanta pharma etc. From the above topics I think the auto ancillaries specifically catering to two wheelers could be the best bet.

Edited by basant - 08/Jan/2010 at 10:55am

Electricity is a big problem in rural areas. Affordable alternative enery products should do well. But is there any listed co. in this space??