SECTION IV: ABOUT THE COMPANY
INDUSTRY OVERVIEW

Except as otherwise indicated, the information contained in this section is derived from a report titled “Studying
the Automotive and Industrial Engineering Business in India” dated December 2020, prepared by CRISIL
Research. Neither we nor any other person connected with the Offer has independently verified this information.
Industry sources and publications generally state that the information contained therein has been obtained from
sources generally believed to be reliable, but their accuracy, completeness and underlying assumptions are not
guaranteed and their reliability cannot be assured. Industry publications are also prepared based on information
as of specific dates and may no longer be current.

GLOBAL ECONOMY

The global economy has been under turmoil ever since the first wave of the Covid-19 pandemic at the start of the
calendar year. Succeeding waves of Covid-19 infections are leaving the global economy gasping for air when it
resurfaces from the depths, as seen in April 2020. Economic activity has normalised faster than anticipated,
according to the International Monetary Fund (IMF), with support from government investment (China) and
transfers supporting household incomes as in the United States (US) and Europe. However, the global economy
continues to reel under the pandemic.

Reinfections in several regions, particularly Europe, have meant reinstated partial lockdowns or countries slowing
down their opening. Moreover, the recovery has not been uniform, with advanced economies generally doing
better than developing economies, where results have been mixed, as per S&P Global (October 2020). A strong
rebound, albeit partly mechanical, was seen in the third quarter, but the momentum has slowed in the fourth
quarter. Purchasing managers’ indices (PMI) showed firms in the US, euro area (EA) and China expanded output
in July and August. However, in September 2020, these indicators point to stronger activity in manufacturing, but
some slowdown in services, reflecting the increase in infections, stated the IMF.

GDP growth (q-o-q, annualised, %)

Q1-19 Q2-19 Q3-19 Q4-19 Q3-20
us | 31 21 21 5 33.1
UK* 06 y 0.3 ; : 8 NA
EArt 05 0.3 ; f 12.7
Japan 28 NA
China* 64 49

 

inpovenest ET ncaa

Note: #q-o-q, not annualised; *y-o-y; Years represent calendar year
Source: Statistical bureau, respective countries

The IMF expects the world gross domestic product (GDP) to drop 4.7% in 2020 from 2.42% rise in 2019. S&P
Global has kept its global GDP forecast for 2020 relatively unchanged at -4.1%, while raising forecasts for the
US and euro zone on the back of a stronger than expected rebound in the third quarter, and for China (where the
rebound took place in the second quarter). These improvements have been offset by a lower forecast for India as
well as for the United Kingdom (UK) and Japan.

 

GDP growth (%)
aE) | 2021P
US 22 39
Euro zone 1.3 6.1
India 4.2 10
China 6.1 : 6.9
Japan 07 (6.4) 33
World 2.4 (4.1) 5.3

Note: India outlook is for fiscal year, i.e., 2019 ~ FY20, 2020 ~ FY21 and 2021 ~ FY22
Source: S&P Global

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