Research Methodology - Market Definitions
Indonesia Industrial
Water and Waste Water Treatment market: It is defined as the
total value of projects announced for construction of industrial water and waste
water
treatment in power plants. It includes the EPC contracts, Operation and
maintenance, capacity addition and upgradation and equipment sales. It excludes
the revenue generated by Indonesian firms executing overseas contracts as well
as sewage treatment and municipal water treatment.
Indonesia Operation
and Maintenance Market: It is defined as th revenue generated by providing
third party operation and maintenance service for water and waste water
treatment in various private and government industry. It includes the cost of
labour supply , chemicals and others. It excludes the cost of treatment done by
companies themselves.
Indonesia EPC market
for Industrial water and Waste Water Treatment: It include the total
value of projects allocated in a particular year for construction of new
plants, upgradation of existing plants and capacity addition. It includes the
cost of engineering, construction, material supply and commissioning. It
includes both individual Industrial WTP
and Industrial Zone WTP. It excludes the water treatment projects for municipal
and sewage treatment.
Indonesia Industrial Water Treatment Equipment
Market: It is defines as the total price
paid by EPC contractors to OEMs and material suppliers in industrial water and
waste water treatment for supply of equipments to be installed and consumed
while construction of WWTPs.
Research Methodology - Consolidated Research
Approach
Hypothesis Creation: The research team has first framed a
hypothesis about the market through analysis of existing industry factors
obtained from magazines, journals, broker reports, investor presentations and
annual reports of major companies, Ministry of Environment and Forests, Ministry of Industry and Others.
Hypothesis Testing: The research team conducted computer assisted
telephonic interview (CATI) with several industry professionals including
decision makers in EPC and Equipment manufacturing companies. The industry
professionals included several management executives, and other higher level
authorities. Structured interviews were conducted through telecom with several
industry veterans including major decision makers from Metito, Concept
powertech, PT Nobel and other companies. The analyst at Ken Research collated
their insights on the market onboard and to seek justification to the
hypothesis framed by the team.
Sanity Checking @
Decision Tree Analysis: Data has
been collected and verified through cross-sanity checking the opinion and facts
received from interview with the hypotheses framed from public databases. The
team has verified the data by conducting both bottom-to-top and top-to-bottom
analysis.
Future Forecasting via
Poll Opinions and Statistical Tools: Multi-Factor regression was conducted on the
lag variables by identifying the independent and quantifiable variables
directly affecting the market. The forecasting was done by using SPSS
statistical tools. The variables were checked for multi-co-linearity and other
bias that could be present in the model. The conclusion from the regression was
then double-checked by conducting poll opinions.
Interpretation and
Proofreading: The final analysis will then be
interpreted in the research report by our expert team well versed with the
Water Industry.
Research Methodology - Market Sizing and
Limitation – Water and Waste Water Treatment Market
Market Sizing:
Ø Initially, we
identified all major EPC and equipment supplier water treatment companies
operating in the market. We then collated the order intake for current year,
revenue from sale of equipments and O&M contracts. This helped us in sanity
checking the current market size provided by industry veterans.
Ø We also collated the
information for entire water treatment industry size including Sewage
treatment, Municipal supply and industrial water treatment and then interviewed
industry professionals to seek their expert opinion on contribution of
industrial water and waste water treatment.
Ø We have conducted
multiple CATIs with industry experts and management of leading EPC companies
and equipment manufacturers to understand the market size, bidding system,
customer acquisition, and their views on future development. This helped us in
estimating revenue generated for the overall market and validating the future
growth in the market
Limitation:
Ø It can happen that
some of the projects may get caught up in legal battle or protest from local
bodies which can either delay the project or may even stop the project. It is
also possible that company exit the projects due to some technical or financial
issue.
Ø It might be possible
that some companies may have included equipment supply or construction cost in
their order book and other EPC players may have included the cost in their EPC
contract which may lead to over reporting or overestimation of the market.
Ø Market for O&M
was estimated based on opinion provided by industry experts, however it might
be possible that it may vary slightly with margin of error of 10% from original
market size considering that many companies opt for captive treatment rather
than outsourcing the O&M job and gauging such information was our research
constraint.
Research Methodology - Variables (Dependent
and Independent)
Variables Considered:
Ø Installed Capacity of Thermal Power plant in
MW:. Installed
capacity of thermal power plants play a very large contribution in water and
waste water treatment market as it is the biggest user of water in the
industry.
Ø Palm Oil
Production in Thousand Tons: Indonesia is the biggest producer of Palm Oil in
the world and the expansion and growth of this industry has a strongly positive
contribution to the water and waste water treatment market.
Forecast Modelling:
Ø The report applies
Correlation and Regression analysis methods to forecast the future of the
Industrial water and waste water treatment market. The capabilities of SPSS and
predictive analytics software have been leveraged to determine the relevant
indicators used for forecasting this industry. However, findings were not in
line with that of the industry experts
and our theory. So we took a weighted average of all the data available to us
through primary and secondary sources and found the results.
Ø In the present case,
water and waste water treatment market revenue has been taken as the dependent
variable and other variables such as installed capacity of thermal power plant
and palm oil production have been taken as independent variables.
Indonesia Water and Waste Water Treatment
Market Overview
Water
Utilization Key Takeaway:
• Total water
availability in Indonesia is ~ billion m3/year ( source: ADB Report, 2016)
• Total water demand
is 175 billion m3/year (source: ADB
Report, 2016)
• The total amount of
urban wastewater generated in approximately
~ billion liters per day out of
which only 1 percent is treated. (source: World Bank Report, 2013)
• There are 4
industrial regions in Indonesia- Java, Sumatera, Sulawesi and Kalimantan. These
regions require an average daily demand of ~ million m3/ day (Source: ADB
Report, 2016)
• Agro-industry, Food
& Beverages industry, Textiles, and Paper & Pulp industry are the water
intensive industries in Indonesia requiring a large level of water as input.
• Generation of Industrial Waste Water
• Major region in
Indonesia contributing to the market for industrial water and waste water
treatment industry include Sumatra (~%), Jakarta and Java (~%), Sulawesi (~%)
Kalimantan (~%), Maluku and Irian Java (~%)
Citarum river, once declared the world’s dirtiest
river by two nonprofit organizations, the New-York-based Blacksmith Institute
and Switzerland-based Green Cross, is now the target of a large project by the
government following a directive from Indonesian President Joko
"Jokowi" Widodo in Jan 2017. This was a reaction to the discovery
made in the 2013 study which said that an approximate 280 tons of toxic waste
is deposited in Citarum river every day.
Operation
And Maintenance Contracts (Past, Present and Future)
Its is expected that as
energy efficiency and environmental impact of effluent discharge gains more
importance the role of experts in O&M of WWT and WT will increase. Energy
consumption of equipments is expected to boost the overall value of contract.
Large scale industries and government owned enterprises whose primary business
is not related to water treatment are expected to continue or increase their
reliance on third party operators
Earlier the contracts for O&M form a part of EPC
contracts with period of contract extending much beyond three to five years.
Large companies outsource their water treatment facilities to same companies by
renewing the contract. Government companies use to issue long term O&M
contracts.
The market has become very competitive with many
active players in O&M. business. The contract for O&M become very cost
competitive due to increased competition. Criteria for selection is now based
on cost, prior experience, and adaptability and availability of local manpower.
The business is now slowly being captured by local companies in the area.
For more information on the research report, refer to
below link:
Related Reports
Contact Us:
Ken Research
Ankur Gupta, Head Marketing & Communications
sales@kenresearch.com
+91-9015378249
Ken Research
Ankur Gupta, Head Marketing & Communications
sales@kenresearch.com
+91-9015378249
