Growing urbanisation, coupled with retail boom and increased concerns regarding security of men, money and material has led to rise of organisation under the umbrella of private security segment in India.
The Indian security industry was INR 40,000 crore in 2014 and is expected to reach INR 80,000 crores by the year 2020. This growth is fuelled by creation of additional infrastructure like industrial complexes, public infrastructure, residential complexes and the humungous opportunity presented by government initiatives like ‘Smart Cities’ and ‘Make in India’.
The private security industry in India also provides employment to more than 70 lakh people, which is expected to rise manifold as the size of the industry increases.
The Indian security industry, which primarily comprised man-guarding is now witnessing a shift towards cash management and electronic surveillance.
Grant Thornton India LLP and FICCI, through this report bring to you an in-depth analysis of the Indian security industry along with a broad global perspective. The report also provides an analysis of the industry break-up of key players and their outreach. We hope this report will draw attention of its readers and policy makers towards sustainable development of security space in context of today’s India.
The sector seems to have a very positive outlook both from an organic and an inorganic growth perspective. Due to continued thrust on infrastructure development, the industry has a huge potential to grow organically since it is an ancillary service which is required both at infrastructure development stage and also at maintenance stage. On the inorganic growth front, there is a huge opportunity to consolidate the market as there are large number of small firms that present themselves as attractive targets. This will help capture bigger share of the pie of the industry. While valuation mismatch and concerns around corporate governance may be an obstacle to the domestic M&A, a few small firms may not be able to survive the increasing quality and transparency expectations from the customers. Funding domestic transactions might be a challenge, however pickup in alternate buy out financing by PEs will be a definite option.