India’s robust and consistent economic growth over the past few years has accentuated the role played by small and medium enterprises in the development process of the country. In recognition of this contribution of SMEs, Dun & Bradstreet has launched the SME Awards 2008 and the accompanying publication, Emerging SMEs of India 2008. This initiative seeks to felicitate and document the achievements of the country’s emerging SMEs and create a forum for them to reach out to their potential customers.

Overall, 10 prominent SME intensive sectors were short-listed for the purpose of the awards and the publication. We classified the SME sector into two revenue segments, namely small and medium, based on turnover. The companies nominated themselves in their respective sectors and were classified under revenue categories based upon their net turnover for FY07. A proprietary financial model was used to arrive at the winners and runners up for the sectors, under each revenue category. Emerging SMEs of India 2008 profiles 58 companies that emerged winners and runners up across the 10 sectors. Other participants that submitted their nominations have been listed in the publication.

Of all the companies that responded with nominations, 289 were considered for analysis. The information provided in the nomination forms of these companies was collated and aggregated to arrive at key insights for these leading SMEs. For FY07, these companies reported combined annual net sales of around Rs 63.08 billion, net profit of Rs 3.94 billion and had strength of around 53,391 employees. Some other major highlights are as follows:

• Largest representation in the sample came from the engineering sector (18%) followed by plastics (16%).
• 33% of the total companies operate with more than one plant.
• The average capacity utilisation of all the companies stood at around 80%.
• 59% are equipped with one or more sector-specific quality certifications and standards.
• 11% of the companies are designated as EOUs.
• Net sales for medium-sized companies grew by 37% year-on-year in FY07, as compared to a 32% growth in net sale for small sized companies.
• However, in terms of net profit small sized firms turned out to be more resilient with 58% y-o-y
  growth as compared to 26% growth for medium sized firms.
• 76% of the small sized firms were involved in exports. Of these, around 44% earn more than 50% of their revenue from exports.

The growing domestic economy and globalisation is resulting into ever increasing business opportunities for SMEs, and they are expected to play a much larger role in sustaining India’s growth aspirations. D&B will continue to track SME related developments, and seek to support the growth efforts of this segment of the economy through our future endeavours.

Kaushal Sampat
Chief Operating Officer
Dun & Bradstreet India