MIRA INFORM REPORT
|
Report Date : |
6th May 2006 |
IDENTIFICATION DETAILS
|
Name : |
BIG BAZAAR – PROPRIETOR-
PANTALOON RETAIL INDIA LIMITED |
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Registered Office : |
Knowledge House, Shyam
Nagar, Off Jogeshwari-Vikhroli Link . Road, Jogeshwari (East), Mumbai 400060 |
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Country : |
India
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Financials (as on) : |
30.06.2005 |
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Date of Incorporation : |
12TH
October, 1987 |
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CIN No.: |
U99999MH1987PTC044954 |
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Com. Reg. No.: |
11-44954 |
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TAN No.: (Tax Deduction &
Collection Account No.) |
MUMP16929D
/ CALP06339E |
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PAN No.: (Permanent Account No.) |
AAACP6317L |
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Legal Form : |
It
is a Public Limited Liability Company.
The company's shares are listed on the Stock Exchanges. |
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Line of Business : |
The
company engaged in manufacturing of Trousers of Synthetic Fibers, Shirts of Man-made
Fibers and Woven Fabrics of Synthetic Staple Fibers |
RATING & COMMENTS
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MIRA’s Rating : |
A |
RATING
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STATUS |
PROPOSED CREDIT LINE |
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56-70 |
A |
Financial &
operational base are regarded healthy. General unfavourable factors will not
cause fatal effect. Satisfactory capability for payment of interest and
principal sums |
Fairly Large |
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Maximum Credit Limit : |
USD 8500000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject
is a well established and reputed company in retail chain stores industry.
The company is progressing very well. Trade relations are reported as fair.
Business is active. Payments are always correct and as per commitments. The
company can be considered good for any normal business dealings. |
LOCATIONS
|
Registered Office / Corporate Office : |
Knowledge House, Shyam
Nagar, Off Jogeshwari-Vikhroli Link . Road, Jogeshwari (East), Mumbai 400060 |
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Tel. No.: |
91-22-56442200 |
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Fax No.: |
91-22-56442201 |
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Website : |
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Locations : |
1. Big Bazaar Kolkata ( VIP Road) Address: Parvati Vihar,
52/6 V.I.P.Road, Baguihati, Kolkata
Phone
no. (033)
25703651 / 3655 Store
Opening Date 11
Oct 2001 Space
: 25,000
- 30,000 sq.ft. 2.
Big
Bazaar Abid's Hyderabad Address Maheshwari Palace Mall,
Palace Talkies Compound, #4-1- 833, Abids, Hyderabad. Phone no. (040) 4758385/ 8376/ 8377 / 8378 Store
Opening Date 14 Oct 2001 Space 43,500 - 60200sq.ft. 3. Big Bazaar Bangalore: Address Salapuria Towers,#22 ,
Koramangala Industrial Layout,
Hosur Road, Bangalore. Phone no. (080) 25520889/25520751 Store
Opening Date 8 Nov 2001 Space 36,000 sq.ft. 4. Big Bazaar Mumbai
(Lower Parel) Address Phoenix
Mills Compound, 462, Senapati Bapat Road, Lower Parel, Mumbai-400
013. Phone
no. (022)
56626703 - 4 Store
Opening Date 13 July 2002 Space
40,000
sq.ft. 5. Big Bazaar Mulund
(Mumbai) Address C/O Runwal Arcade, Opp
Richardson Factory, LBS
Marg, Near Mulund(West), Mumbai 400 080 Phone
no. (022)
55550606 Store
Opening Date 19 April 2003 Space 56,000 sq.ft. 6. Big Bazaar Gurgaon Address: C/O Sahara India Commercial
Corporation Ltd., Sahara Mall, Main Mehrauli Gurgaon Road, Gurgaon. Haryana. Phone
no. (0124)
5003330 Store
Opening Date 1 June 2003 Space
: 45,000
sq.ft 7. Big Bazaar Nagpur Address: Landmark Dhantoli Wadi
Road, Nagpur Phone no. (95712) 25620201 Store Opening Date 18 Oct 2003 Space : 48,600 sq.ft. 8. Big Bazaar Ahmedabad Address:
Rudra
Point, Near Isckon Temple, Gandhi Nagar-Sarkhej Highway, Ahmedabad. Phone
no. (079)
55305300 Store
Opening Date 21 Feb 2004 Space
: 55,000
sq.ft. 9. Big Bazaar
Bhubaneswar: Address:
Forum, 89,
Kharavelnagar, Unit-III, Bhubaneswar-751001, Orissa. Phone
no. (0674)
3217780. Store
Opening Date 27 March 2004 Space
: 40,000
sq.ft. 10. Big Bazaar Nasik Address The Zone, College Road,
Nasik 422 005 Phone
no. (0253)
2318218 - 28 Store
Opening Date 19 June 2004 Space
26,000
sq.ft. 11. Big Bazaar Kolkata(Hiland Park) Address The Metropolis, 6 Hiland
Park, 1925 Chakgaria, P.S.Jadavpur, Kolkata. Store
Opening Date 4th December 2004 Space
26,000 sq.
ft. 12. Big Bazaar Ahmedabad (Kankaria) Address Ahmedabad City Mall, New
Cotton Mills Compound, Outside Raipur Gate, Opp. Arya
Seva Samaj Hall, Kankaria Road, Ahmedabad. Store
Opening Date 24th Dec 2004 Space
80,000
sq. ft. 13. Big Bazaar Gaziabad(EDM) Address EDM, Plot No .1 Kaushambi,
Gaziabad Phone
no. 0120
3001300/301 Store
Opening Date 25th Dec 2004 Space
60,000
sq. ft. 14. Big Bazaar Durgapur Address Durgapur City Centre, Durgapur. Pin
- 713216 Phone
no. (95343)
2543021 Store
Opening Date 5th April 2005 Space
16,000
sq.ft. 15. Big Bazaar Kandivali Address :Growel
Plaza, Akurli Road,Off Western Express Highway, Kandivali(E) Mumbai-400101 Phone no. Store
Opening Date May 14, 2005 Space 65,000 sq.ft. 16. Big Bazaar -Lake City Mall (Thane) Address Lake City Mall (Thane), Kapurbawdi Junction
,Ghodbunder Road, Thane (W), Mumbai-400080 Phone no. 022-2542 6644 Store
Opening Date May 14, 2005 Space 50,000 sq.ft. 17. Big Bazaar Banshankari Address 92/9, 80 Feet Road, BSK III Stage, Kathariguppa,
Banshankari Bangalore 560085 Phone no. 080-5514 9000 Store
Opening Date June 24, 2005 Space 94,120 sq. ft. 18. Big Bazaar Sangli Address New Pride Multiplex Near CircuitHouse, Madhav
Nagar Road Vakharbhag, Sangli 416416, Phone no. 0233-262 4141 Store
Opening Date June 29, 2005 Space 28,000 sq. ft. 19. Big Bazaar Inderlok Address Metro Mall, Inderlok, Delhi Phone no. Store
Opening Date July 1, 2005 Space 29,700 sq. ft. 20. Big Bazaar Lucknow Address Sahar Ganj, Shahnajaf Road Hazratganj, Lucknow Phone no. Store
Opening Date Nov 17, 2005 Space 60,000 sq ft 21. Big Bazaar Indore Address Treasure Island ,11 Tukoganj Main Road, Indore
452001 Phone no. 0731-3011300 Store Opening
Date Dec 23, 2005 Space 50,000
sq ft 22. Big Bazaar Pune Address Fun n Shop Building , Fatima Nagar, Solapur
Road, Pune Phone no. 020-5642 0500 Store Opening
Date Dec 17, 2005 Space 36,000
sq ft 23. Big Bazaar Vizag Address GV Manor, Beside Sangam Sharat Theatre, Station Road
Dwarkanagar, Vishakapatnam 533016 Phone no. Store Opening
Date October 5, 2005 Space 47,000
sq ft 24. Big Bazaar Pune Address Netaji Subhash Place, Metro Station, Ansal MGF
Metro Plaza Wazirpur 110034 Phone no. 011 -3952 8244 Store Opening Date
July 22, 2005 Space 35,000
sq ft 25. Big Bazaar at Citi Gold Multiplex, Ahmedabad Address Citi Gold Multiplex, Bapu Nagar, Ahmedabad Phone no. : Store
Opening Date : April
14, 2006 Space : 30,000 sq ft 26. Big Bazaar at Star & Sitara at Banshankari,
Bangalore Address Big Bazaar, 3rd Flr, Banshankari, Banglore Phone no. Store Opening Date April 20, 2006 Space 30,000 sq ft 27. Big Bazaar at Bharat Mall, Mangalore Address Bharath Mall, Kodialbail Village Phone no. Store Opening Date April 22, 2006 Space 6,715
sq ft |
DIRECTORS
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Name : |
Mr. Kishore Biyani |
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Designation : |
Managing Director |
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Date of Birth/Age : |
45
years |
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Qualification : |
B.Com, PGD in marketing |
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Experience : |
25
Years |
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Date of Appointment : |
01/06/1991 |
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Name : |
Mr.Gopikishan Biyani |
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Designation : |
Wholetime Director |
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Date of Birth/Age : |
60
Years |
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Qualification : |
B.
Com |
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Experience : |
29
Years |
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Date of Appointment : |
01/06/1991 |
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Name : |
Mr. Shailesh Harfbhakti |
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Designation : |
Director |
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Name : |
Mr. S. Doreswamy |
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Designation : |
Director |
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Name : |
Dr. Darlie Koshy |
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Designation : |
Director |
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Name : |
Mr. Anil Harish |
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Designation : |
Director |
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Name : |
Ms. Anju Poddar |
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Designation : |
Director |
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Name : |
Ms. Bala Deshpande |
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Designation : |
Nominee Director |
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Name : |
Mr. Shiraj Dej |
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Designation : |
Company
secretary |
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Name : |
Mr. Rakesh Biyani |
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Designation : |
Wholetime Director |
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Date of Birth/Age : |
33
Years |
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Qualification : |
B.
Com |
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Experience : |
11
Years |
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Date of Appointment : |
01/04/1997 |
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Name : |
Mr. Ved Prakash Arya |
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Designation : |
Director - Operations
& Chief Operating Officer |
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Date of Birth/Age : |
35
Years |
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Qualification : |
BE,
MBA |
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Experience : |
10
Years |
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Date of Appointment : |
29/03/2004 |
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Name : |
Mr.
Chinar S. Deshpande |
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Designation : |
Chief
Information Technology |
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Date of Birth/Age : |
36
Years |
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Qualification : |
BE,
MBA, MS |
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Experience : |
12
Years |
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Date of Appointment : |
17/05/2004 |
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Last Employment: |
Dodsal
Pvt Ltd. |
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Name : |
Mr.
Krishnakant Rathi |
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Designation : |
Head
Risk Management and Finance |
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Date of Birth/Age : |
43
Years |
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Qualification : |
ACA,
ACS |
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Experience : |
20
Years |
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Date of Appointment : |
17/01/2005 |
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Last Employment: |
H
and R Johnson India Limited |
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MAJOR SHAREHOLDERS
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Names of Shareholders |
No. of Shares |
Percentage of Holding |
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Promoters & their
Relatives |
9471619 |
43.06 % |
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Mutual Funds |
587628 |
0.14 % |
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Banks, Financial
Institutions |
30647 |
0.14 % |
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Foreign Institutional
Investors |
6478260 |
29.45 % |
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Non Resident Indians &
OCBs |
130433 |
0.59 % |
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Indian Companies |
1686985 |
7.67 % |
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Indian Public |
3578245 |
16.27 % |
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Clearing Members |
33919 |
0.15 % |
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Total |
21997736 |
100.00 % |
BUSINESS DETAILS
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Line of Business : |
The
company engaged in manufacturing of Trousers of Synthetic Fibers, Shirts of Man-made
Fibers and Woven Fabrics of Synthetic Staple Fibers |
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Products : |
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PRODUCTION STATUS
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Particulars |
Unit |
Licensed Capacity |
Installed Capacity |
Actual Production |
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Apparels |
Nos. in Millions |
NA |
300 Stitching
Machines |
2.865 |
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GENERAL INFORMATION
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Bankers : |
Ř
Bank of India Ř
UTI Bank Limited Ř
Syndicate Bank Ř
Oriental Bank of Commerce Ř
Andhra Bank Ř
UCO Bank |
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Facilities : |
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Banking Relations : |
Good
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Auditors : |
NGS
and Company Chartered
Accountants |
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Advocates and
Solicitors: |
Haresh
Jagtiani & Associates |
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Associates : |
1. Pantaloon Industries
Limited 2. Indus League Clothing
Limited 3. KB Mall Management
Company Limited 4. PFH Entertainment
Limited; 5. Mark Middle East,
L.L.C., Dubai! (For part of the year) 6. Manz Retail Private
Limited; 7. Idiom Design &
Consulting Limited 8. Nishta Mall Management
Company Private Limited 9. Niyaman Mall Management
Company Private Limited 10. Acute Realty Private
Limited 11. Dhruv Synthetics
Private Limited 12. Anchor Malls Private
Limited 13. Varnish Trading
Private Limited 14. Bansi Silk Mills |
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Subsidiaries: |
1. Home Solutions Retail
(India) Limited 2. Pantaloon Food Product
(India) Limited 3. Pan India Restaurants
Limited 4. PFH Investment Advisory
Company Limited 5. Pantaloon Retail
Technogies Limited. (For part of the year) |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
25000000 |
Equity Shares |
Rs. 10/-each. |
Rs. 250.000 Millions |
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Issued, Subscribed
& Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
21997736 |
Equity Shares |
Rs. 10/-each. |
Rs. 219.977 Millions |
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FINANCIAL
DATA
[all figures are in Rupees Millions]
ABRIDGED
BALANCE SHEET
|
SOURCES OF FUNDS |
30.06.2005 |
30.06.2004 |
30.06.2003 |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
219.977 |
191.374 |
181.800 |
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2] Share Application Money |
30.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
1965.275 |
757.529 |
495.000 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH
|
2215.252 |
948.903 |
676.800 |
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LOAN FUNDS |
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|
1] Secured Loans |
2561.700 |
2147.606 |
1413.200 |
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2] 10%Unsecured Fully
Convertible Debenture |
0.000 |
213.547 |
0.000 |
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3] Unsecured Loans |
300.379 |
0.082 |
42.300 |
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TOTAL
BORROWING
|
2862.079 |
2361.235 |
1455.500 |
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DEFERRED TAX LIABILITIES |
130.436 |
60.301 |
29.200 |
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TOTAL
|
5207.767 |
3370.439 |
2161.500 |
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APPLICATION OF FUNDS
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FIXED ASSETS [Net Block]
|
2137.417 |
1603.879 |
1073.100 |
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Capital work-in-progress
|
157.916 |
144.414 |
33.200 |
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INVESTMENT
|
319.155 |
52.623 |
52.600 |
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DEFERREX TAX ASSETS
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CURRENT ASSETS, LOANS & ADVANCES
|
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Inventories
|
2759.256
|
1575.974 |
1143.800 |
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Sundry Debtors
|
123.066
|
175.842 |
223.200 |
|
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Cash & Bank Balances
|
215.004
|
138.476 |
80.700 |
|
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Other Current Assets
|
4.608
|
0.000 |
0.000 |
|
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Loans & Advances
|
936.800
|
409.543 |
214.300 |
Total Current Assets
|
4038.734
|
2299.835 |
1662.000 |
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Less : CURRENT LIABILITIES & PROVISIONS
|
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Current Liabilities
|
1264.744
|
664.822 |
620.700 |
|
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Provisions
|
183.471
|
69.491 |
44.000 |
Total Current Liabilities
|
1448.215
|
734.313 |
664.700 |
|
Net Current
Assets
|
2590.519
|
1565.522 |
997.300 |
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MISCELLANEOUS EXPENSES
|
2.760 |
4.001 |
5.300 |
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TOTAL
|
5207.767 |
3370.439 |
2161.500 |
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PROFIT & LOSS ACCOUNT
|
PARTICULARS |
30.06.2005 |
30.06.2004 |
30.06.2003 |
Sales Turnover [including other income]
|
10882.875 |
6596.395 |
4453.200 |
|
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Profit/(Loss) Before Tax
|
531.208 |
244.119 |
141.700 |
Provision for Taxation
|
145.697 |
46.333 |
27.600 |
Profit/(Loss) After Tax
|
385.511 |
197.786 |
114.100 |
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Export Value
|
260.440 |
115.322 |
NA |
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Import Value
|
184.448 |
131.946 |
NA |
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|
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Total Expenditure
|
10351.668 |
6352.276 |
4074.300 |
KEY RATIOS
|
PARTICULARS |
|
30.06.2005 |
30.06.2004 |
30.06.2003 |
PAT / Total Income
|
(%)
|
3.54
|
3.00 |
2.56 |
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Net Profit Margin
(PBT/Sales) |
(%) |
4.88
|
3.70 |
3.18 |
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Return on Total Assets
(PBT/Total Assets} |
(%) |
8.60
|
6.25 |
5.18 |
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Return on Investment (ROI)
(PBT/Networth) |
|
0.24
|
0.26 |
0.21 |
|
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|
Debt Equity Ratio
(Total Liability/Networth) |
|
1.95
|
3.26 |
3.13 |
|
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|
|
|
|
Current Ratio
(Current Asset/Current
Liability) |
|
2.79
|
3.13 |
2.50 |
LOCAL AGENCY FURTHER INFORMATION
Fixed Assets
Ř
Land
Ř
Leasehold Land
Ř
Building
Ř
Plant & Machinery
Ř
Office Equipments
Ř
Computer Owned
Ř
Computer Leased
Ř
Furniture & Fittings
Ř
Electrical Instal.
Ř
Vehicles
Ř
Air Conditioner
Ř
Generator
Ř
Delivery Van
The Company is not required to obtain License under
Industries (Development and Regulation) Act, and therefore licensed capacity is
not applicable.
The Company having dealt in a large number of products
in several locations, the information required in terms of Schedule VI of the
Companies Act in respect of value of the products sold has been drawn up in
respect of major items namely Apparels and Household Items. The other items
have been grouped together as sales value in respect of each product is not
practical to ascertain.
Big Bazaar
From
Wikipedia, the free encyclopedia
Jump to: navigation, search
Big Bazaar is a chain of
shopping malls in India, owned by the Pantaloon Group
and which work on Wal-Mart type
economies of scale. They have had considerable success in many Indian cities
and small towns.
Though Kishore Biyani is the founder-CEO, it is alleged that the chain is
controlled by the fugitive Indian don Dawood Ibrahim.
In 2003 the workers at one of its outlets in a
store in Mulund, a Mumbai suburb caught a man shoplifting. It was alleged that the man
was bashed after having been caught stealing a razor worth Rs.80 (less than
$2). The man died shortly afterwards. [1]
Big Bazaar of Hyderabad is
located at MPM Mall, Abids, Opp. GPO, Hyderabad 5000001. Tel.:24758376 This is
a discount type department store. They have everything from household
appliances to clothing, toys, gifts, etc... It is very similar to the large
discount chain stores found in America. It also seems to have special volume
purchase items that may not always be available. It appears to be a local
favorite with durable comsumer goods and decoration goods of mass produce quality.
A place where a local may buy a new lunch box or clothing. It is set inside a
large complex that may include multiple building combined into a central court
yard. It is difficult to distinguish building boundries. Lining the courtyard
and embedded inside and outside of the courtyard a vast assortment of small
shops exist. These shops are varied from open faced sunglass or watch venders
to glass fronted specialty shops. One fine jewelery store is located inside and
is the jewelry department. A costume jewelery store is found outside and is a
separate business. Thus everything from very inexpensive trinkets to fine gold
and precious stones, including diamonds, can be found within and around the BIG
BAZAAR. As everywhere in Hyderabad, pearl shops abound. This is an older
location so the atmosphere is not sparkling clean or new. It may be classified
as a local's shopping area. There are food venders present. It is not a bazaar
in the strict manner of the open street or open grounds bazaar but price
negotiations or haggling may be acceptable, especially in jewelry shops. Having
someone local accompany you to engage in the bartering is recommended. From a
foreigner's perspective, it appears that questioning the workmanship and
quality is part of the negotiation. The surrounding streets are lined with
small shops. Most of the shops along the street appear to be well groomed and
lighted and comfortable. The outside appearance and surroundings may be less
attractive. The local area is classified as an older portion of town and during
times of cultural or religious tension, it is not recommended to visit the
older areas. Given the co-existance of Hindu and Muslim peoples of the area a
small event may turn riotous very quickly in such situations
External links
Pantaloon Retail India
Limited made Its foray into the retail industry by launching its flagship brand
Pantaloons which is today one of the largest retails store claims in the
country. The emphasis here was primarily apparel and lifestyle products.
With Big Bazar, Pantaloon
promise more for less addressing a winder range of product lines which are of
interest to the mass market. The high
service levels good ambience and implicit guarantees make shopping at Big Bazar
a worry free experience. Essentially this hypermarket concept it well on it’s
way to changing the very face of the Indian retelling industry.
What's
in store for you at Big Bazaar?
1,70,000 products at 6- 60 % discount.
At Big Bazaar, you will get : A wide range of products at 6 – 60 % lower than
the corresponding market price, coupled with an international shopping
experience.
If you deal in the
categories mentioned there's a big deal of success for you.
Ř
Apparel and Accessories for Men , Women and Children.
Ř
Baby Accessories.
Cosmetics
Crockery
Dress Materials Suiting & Shirting
Electrical Accessories
Electronics
Footwear
Ř
Toys
Home Textiles
Home Needs
Household Appliances
Household Plastics
Hardware
Home Decor
Ř
Luggage
Linens
Sarees
Stationery
Utensils & Utilities
EXPANSION PLANS
The
company has drawn up an aggressive expansion plan for the future. Total retail
space
at the end of 2004-05 stood at over 1.9 million square feet with around 1
million
square
feet being added in the year under review. The company will further step up the
pace
of expansion and based on the space currently signed, expects 3.5 million
square
feet
to be operational by June 2006 and 7 million square feet by June 2007
LINE OF BUSINESS –
Fashion Comprising
cose to 50 per cent of the total revenues of the company, fashion continues to
be the strength of Pantaloon. The antecedents of the company lie in garment
manufacturing and it is the ability to understand the fashion business backed
by years of experience that has been a key differentiator for Pantaloon. This
knowledge has enabled the company to come up with a robust private label
programme. Private labels have a crucial
roe
to play for any retailer and especially so for a fashion chain. Having its own
labels allows the company more control and flexibility in determining style,
fashion, fabric and inventory. And ultimately, private labels help in achieving
better margins. Pantaloon has over the years been able to create, develop and
sustain a large number of its own labels, targeting men, women, kids and
infants at different price points. These have created a strong equity for the
company and Pantaloon stores today are known for differentiated products but
with a value-formoney proposition. The company reaches out to customers in the
lifestyle segment, through Pantaloons and Central and in the value segment
through Big Bazaar and Fashion Station.
Category
Performance
The
various launches under different categories in Pantaloons stores have been
described below.
MEN'S
The
category witnessed the addition of ethnic and party wear to a strong existing
western
wear
collection. The company was able to capitalize on the trend of differentiated
dressing
for diverse occasions. The category witnessed the following initiatives:
Men's
Formats
JOHN
MILLER
By
periodically introducing technically superior products at competitive price
points,
the
John Miller label as an executive attire brand was strengthened further this
year.
LOMBARD
Lombard
is usually associated with cassic English formalwear with special focus given
to
fine tailoring. The collection under this label has been upgraded resulting in
a
sharper
brand identity. Lombard's summer range emphasized 100% linen shirts and a
new
tailored fit was introduced for customers desiring a slimmer look. The brand
was
extended
to ties, watches and sunglasses. Men's Casuals, party
& ethnic wear
BARE
DENIM
Bare
Denim; one of the most successful private brands was repositioned to target the
fashion
conscious 18-35 year age segment. The selection now includes fashion forward
denims
with contemporary fits
In
order to meet the fast growing demand for party and evening wear, Pantaloons
introduced
club and lounge wear through the 'F' brand. Products include shirts, t-Shirts
and
trousers and cater to the party going 16 to 30 year age segment.
Akkriti
Men's ethnic wear is undergoing a renaissance helped by the exposure
through
films
and television soaps. To meet this demand Pantaloons extended its popular
women's
ethnic wear brand akkriti to include men's wear as well. Men's Knits
AJILE
Ajile
was re-launched with the objective of making it a trendy sports wear label for
both
men
and women.
LADIES
The
category was dominated by the demand for western formal wear for both work and
leisure.
The company has two strong brands in this space, Honey - for young women
and
Annabelle - for mature women. Ethnic wear found favour for the corporate look
as
well
as for evening and leisurewear. Mix-nmatch was also a popular trend. The rising
awareness
for fitness resulted in a strong demand for sports wear and the existing
sports
private label Ajile was successfully extended to cover women. The other
milestones for this category in
2004-05
were:
akkriti
Indo
Western fusion wear is a growing category and with akkriti we have invested in
a
whole new product range. Two innovations carried out in this category were
Ghagroo
and
QAMIZ. Ghagroo is a long skirt inspired from rustic Indian folk, introduced by
the company, Ghagroo has now become a new genre in women's clothing in the
country. The everyday humble kameez (women's traditional shirt) was also given
a fusion twist, with longer
and
slimmer silhouettes and was christened as QAMIZ. MIX-N-MATCH
The
trend in Indian wear has moved fromensembles to buying separates over the last
few
years. There is a large potential for a brand in this category, and the reason
behind
the
launch of mix-n-match. This offering allows women to'create their own looks, by
offering
them
a Vast array of choices in salwars, dupattas and kurtas as separates.
TRISHAA
TRISHAA
was introduced, for women who prefer to get their salwar kameez stitched
according
to their own personal tastes, rather than purchase it off the rack.
LADIES WESTERN
ANNABELLE
The
existing women's western wear brand for working women, extended its offering
to
provide leisurewear (Annabelle Leisure) and evening wear (Annabelle Eve) for
social
occasions.These
offerings now fulfill the needs of young working women looking for stylish,
wellcrafted western clothing for all occasions.
HONEY
The
scope of the western wear brand for young girls was increased to include party
wear
and inner wear.
CHILDREN
A
new private brand was launched in infant wear called Chalk, the brand targets
the age
segment
3-10 and is positioned as a brand for fun loving and energetic kids. Bare 7214
was
launched for the age segment 7- 14 and is for young, urban fashionable kids.
Both the
labels
cater to girls and boys. Lines in party and ethnic wear were also introduced.
STRATEGIC
DIRECTION
The
company's objective is to position Pantaloons as the preferred fashion
destination for the age segment -15 to 35. To achieve this goal, Pantaloons
will churn out fresh fashion at regular intervals and will move on from the
traditional four seasons to seven seasons. This will ensure that stores display
fresh merchandise every 45 to 60 days. The company expects to everage its
strength
in private labels to implement the above plan; this is also expected to result
in
higher
stock turns at the same time reducing markdowns and inventory. The exercise
will
be an integrated one-backed by the appropriate accessories and marketing drive.
A
strong in-house design team has facilitated the regular launch of new labels
and re-vamp
of
existing labels, this is expected to gather steam in the future as the
company moves on
to
being a fashion centric private label driven chain. In the coming years,
regular dollops
of
fresh fashion keeping in mind the Indian perspective with the right mix of
accessories
focused
at the high spending and fast growing numbers of youth is expected to
drive
revenues. International fashion and sportswear are emerging as strong product
categories. As Indians travel the world over with increasing frequency, their
buying habits are being influenced by the latest trends in the west. There is a
small but growing segment of
customers,
which is keen to patronize international lifestyle brands. The company has
entered into a strategic joint venture agreement with speciality retailer
Planet Sports Private Ltd. to cater to this demand. A leading sports and
-fashion retailer with significant presence in South East Asia, Planet Sports
is the sole franchisee for the prestigious UK based retail chain - Marks &
Spencer in India. The company also has the exclusive distribution/licensing
rights for some of the world's best-known sports brands like Wilson, Puma,
Speedo and Converse. Planet Sports currently has 6 Marks & Spencer stores
and 25 Planet Sports stores in India. It also has
the
franchisee rights for well-known lifestyle stores like Guess, Gap, Next,
Debenhams etc. Pantaloon has acquired 49 per cent stake in Planet Sports and
expects to set up multiple stores under each of the above brands in select
cities. The second offering from Pantaloon in the lifestyle segment, Central is
a showcase, seam ess mall, - the first of its kind in India.
The
mall is designed in a manner that does away with in-between walls and shops
offering customers an unobstructed and a pure shopping experience. The revenue
model is based
on
the concept of space utilization; brands pay certain fixed charges based on the
retail
space occupied. Additionally, they also pay a certain percentage of monthly
sales.
These
parameters ensure a de-risked model with the downside being protected - at the
same
time ensuring that the company gains from any upside. Central has been
positioned as a destination where one can shop, eat and celebrate. On offer are
some of the best known national and international fashion brands, food courts,
fkie dining options, book & music stores, lifestyle accessories,
well-stocked food & grocery store and more. Location plays a key role and
Central is situated at the heart of the city. Prime positioning and an array of
different
facilities
are expected to cater to a large portion of the customer's shopping basket.
Pantaloon had launched the first Central in May 2004 in Bangalore; the
performance of the mall during the previous year indicated that Central has
made a strong impression on the citizens of the city. An active promotion
schedule ensured that the store became a much sought after and visited shopping
destination. At 216,000 square feet,
Hyderabad Central is the largest store belonging to the company. Six floors
house some of the best national and global brands in fashion, toys, books,
music, sports and lifestyle accessories. An entertainment zone, food court,
restaurants, music & book stores make Hyderabad Central an
irresistible destination. The store also inc udes a Food Bazaar. Pune Central
is located in the up market Bund
Garden
area, in one of the most rapidly expanding cities in India. The store occupies
over
135,000 square feet of space. In addition to strong fashion and accessories
collection, the store a so has a Food Bazaar, multi cuisine restaurants, food
court and a music store.
|
LOCATION |
DATE |
SIZE
(-SQ. FT.) |
|
Hi
Land Park, Kolkata |
November
2004 |
22,500 |
|
Kankaria,
Ahmedabad |
December
2004 |
66,000 |
|
East
Delhi Mall, Ghaziabad |
December
2004 |
50,000 |
|
Durgapur |
March
2005 |
26,000 |
|
Kandivli,
Mumbai |
May
2005 |
65,000 |
|
Thane,
Mumbai |
May
2005 |
42,000 |
|
Banashankari,
Bangalore |
June
2005 |
98,000 |
|
Sangli,
Maharashtra |
June
2005 |
24,000 |
|
Inderlok,
New Delhi |
July
2005 |
32,500 |
|
Wazirpur,
New Delhi |
July
2005 |
35,000 |
|
Vizag |
October
2005 |
45,000 |
Having
democratized shopping in India, Big Bazaar evolved from a discount store to an
experience catering to the aspirations of the family. This was a big change in
the
perception
of the format and with this; Big Bazaar was able to raise the emotional
quotient
with its customers. In terms of operations, fashion comprises the single
largest chunk and constitutes over 45 per cent of the revenues of a typical Big
Bazaar. The company has been able to leverage on its inherent strength in
fashion and create a strong value-for-money proposition for the Indian
consumer. This aspect highlights the uniqueness of the Big Bazaar model as
compared to traditional hypermarkets, which principally revolve around food,
groceries and general merchandise. It also helps in achieving better margins.
PRIVATE
LABEL PROGRAMME
The
highlight in 2004-05 was the growth of private labels. The share of private
label
revenue
at the commencement of the year was negligible, however during the year, the
category
was able to successfully develop in-house labels catering-to men, women and
children.
The current contribution from private labels as a percentage of the total
fashion
revenues
stands at over 40 per cent.
Highlights of the year
were:
>
Launch of STUDIO NYX, targeted at the disco, pub and club going male customers
in
the
age segment 20 to 40 .
>
Exclusive retailing of ruin tuf, the popular denimwear from Arvind Mills
at Biq Bazaar
outlets
Ř
Launch of Pink n blue for infants
Ř
Licensing
of Tarzan, the popular comic character from Disney for young boys and
girls
>
Launch of accessories under existing private labels Knighthood and
DJ&C
>
Launch of Haute n Spicy, denimwear targeted at college going and young
working
women
In
addition to the above initiatives, the growth in private label share is also
due to increased
revenues
from existing private labels that were launched towards the end of 2003-04. In
the
past year, these labels have managed to create a strong connect with the
customers.
STRATEGIC
DIRECTION
In
the year under review, Big Bazaar moved from being just another apparel store.
Propelled
by an ever-increasing array of private labels, it opened the doors into the
world
of fashion and took the first initial steps. In the coming year, the category
will
take
bold strides in that journey as it attempts to meet the growing fashion
aspirations of a
large
segment of India's population. Private labels are expected to continueto be at
the fore, the category will attempt to introduce labels to fill in the current
gaps. Men's wear and women's wear will be reinforced by the induction of
furtKer occasion specific clothing, at the same time
the
category will strengthen its presence in the kids and infants wear section. By
the end
of
the coming year, the category expects to derive more than half the total
fashion
revenues
from private labels. New categories will continue to be added as the category
strives to provide customers with a 'complete' look. The growing demand for
sports wear will be addressed with the induction of fashion-oriented sport
apparel through a mix of national, international and private labels. The
company has put in place a mechanism, which ensures that the fashion
requirements of each store are looked upon individually keeping in mind the
local
preferences. With trends being closely
monitored at each location, the company
expects
a reduction in inventory levels and markdowns. While, the addition of new
stores and
the
introduction of newer categories are expected to drive revenues, the margins
are expected to improve as the chain moves up the fashion ladder. The
company is all set to increase its share of fashion in the value segment. A
significant event in this direction was the launch of
Fashion
Station-the latest retail format addressing the value end at Pantaloon. A
thematic store, Fashion Station is an attempt to offer fashion forward products
to the mass market. With increasing media penetration and a proliferation of
television channels - some of which cover fashion extensively, the average
Indian is being steadily exposed to bolder and more contemporary fashion. The
result is that within the value market there is a segment that has attained
higher fashion aspirations and this segment is getting larger with time.
Fashion Station is positioned to meet the requirements of this growing number
of customers; it is an effort to take fashion a notch higher in the value
segment. The first Fashion Station opened in Mulund,
MumbaiinMarch2005.Spreadover32,000 square feet, the store houses a mix of
private
labels
sold in Big Bazaar and Pantaloons. These are backed by the requisite
fashion ccessories and appropriate
footwear, which lends an integrated feel to the store and meets the entire
fashion requirements of a customer. The second Fashion Station of 15,000 square
feet opened in Shipra Mall, Ghaziabad in October 2005.
STRATEGIC
DIRECTION
Ready
availability of private labels at different price points permit Pantaloon to meet
varying
customer
requirements. It also allows the product mix to be modified, altered and
finetuned
to
suit regional tastes and local buying power. The company expects Fashion
Station
to
provide customers with a sophisticated shopping experience and deliver better
margins
to its bottomline. The general merchandise business of the company is conducted
through the hypermarket discount chain - Big Bazaar and comprises of various
household requirements and other goods. The principal categories stocked in stores
are utensils, luggage,
plastics,
household & kitchen products, toys, gifts, crockery, sports goods,
stationary, furniture etc. The merchandise under each ategory consists of a mix
of national &
regional
brands as well as unbranded products; this gives consumers the option
of
choosing from different price points and helps the store to attract customers
from
varying
income segments. The wide product offering and multiple price points have made
the
general merchandise segment extremely popular with the consumers.
REVIEW
OF 2004-05
Pantaloon
was successful in increasing the product offerings in the year under review. At
the
commencement of 2004-05, the division primarily revolved around utensils,
plastics
and
luggage. This was enhanced with the introduction of certain other categories;
these
include white goods, furniture, crafts, kitchen appliances etc. The objective
of the
division
is to ensure that maximum products are converted into Volume Producing Items
(VPI's),
this happens when the volume of a product reaches a certain critical mass thus
enabling
the division to profit from benefits of scale. Sourcing is an extremely
critical aspect of the general merchandise business considering the vast
umbrella of products retailed and the
volumes
involved. The company was able to significantly build upon its vendor base in
2004-05,
thus ensuring that the future supply keeps pace with the aggressive expansion
plan.
As Pantaloon builds scale, it is able to source products cheaper, a phenomenon
that
was
in vogue in the past year. The company largely passed on the margin benefits to
the
customers-living
up to its reputation of 'isse sasta aur accha kahin nahin'. Apart from the
categories mentioned above, the company a so introduced new categories such as
auto accessories in 2004-05, and strengthened product diversity and depth in
footwear. Both are emerging product lines and are witnessing an increasing part
of the consumer's expenditure. In the footwear section, the company offers
products to men, women and children at reasonable prices to suit various
occasions, while two-wheeler and four-wheeler owners have an extensive array of
accessories to choose from in the auto accessories section.
The
policy of the company is to launch new best selling categories on a regular basis
in addition to the usual 'bread and butter' categories; this dovetails with the
overall objective of the company to capture the maximum possible, of the
customer's shopping basket.
STRATEGIC
DIRECTION
In
2004-05, Big Bazaar was able to add more categories to its existing line of
best
sellers;
this feature is expected to become a recurring part of the general merchandise
business.
The company will continue to create more categories and innovate in
order
to bring high priced products at low prices for the consumption of the masses.
Some
of the categories that will be in focus in the coming year include furnishings,
appliances,
consumer electronics, health and fitness products etc. This philosophy has also
enabled Pantaloon to embark on an ambitious value-engineering programme. The
company expects to use this tool to rationalize intermediaries and ensure
availability of affordable products to its consumers thus creating a
differentiated setting, one that will help attract customers to the store.
Finally, Big Bazaar is moving away from just being a price driven store. While
affordability will continue to be a key aspect, Big Bazaar is set to introduce
value-added
and
designed products to its consumers. This is in sync with the evolving lifestyle
of a large
segment
of India's population due to the steadily increasing aspiration levels. Housing
is one of the basic needs of human beings and is a significant indicator of the
degree of well-being and development of an individual. The progress of any
nation is measured by the quality of life attained by its people. Availability
of decent and safe shelter is an important component of the quality of life.
With the second highest population in
the world, India has an unfavorable landman ratio. As the country enters
an era of economic growth, the basic urge to own
a
home is being matched by the ability to afford one. A growing population,
increasing
urbanization
and burgeoning middle class in India have always ensured that a healthy
demand
for housing exists. This has been further spurred by the break up of the
traditional
large Indian joint family into small nuclear set ups. However, affordability
and
lack
of easy credit proved to be hindrances in the growth of the housing industry.
All
this was in the past, with an increase in job opportunities, relaxation in
interest rates
and
proliferation of home loan schemes from innumerable financial institutions and
intermediaries-there
exists an annual demand for over 30 million residential units and this is
expected to increase every year. However setting up a house in India remains a
cumbersome business. Since housing and its allied industries are largely
unorganized-consumers face problems from the very beginning - from the
selection of location till choosing the appliances, from buying the right
building materials to getting the matching paint-consumers have to scout all
over without any certainty regarding the price and quality. These drawbacks
provide
Pantaloon
with an opportunity to leverage its retail expertise through new products and
services and increase the company's share of the customer's shopping basket.
Entering the vast untapped home solutions market estimated at between Rs.
70,0000 to Rs. 80,0000 Millions is a logical expansion of the company's
business. Due to its presence in the value & lifestyle segments through
different established formats, Pantaloon has sufficient experience in
understanding the diversity of the Indian consumer's requirements across
geographies in tier 1, 2 and 3 locations. The company has been retailing
furniture, home furnishings, appliances and consumer electronics through Big
Bazaar stores and has built up considerable experience in these areas. A strong
sourcing base has been created through strategic relations with some
of
the top vendors in the above categories. Pantaloon has utilized its expertise,
supply chain, systems, operational ability and customer insight to set up a
subsidiary, Home Solutions Retail (India) Limited (HSRIL), which will cater to
the requirements of different income segments through existing and new formats.
The proposed manner in which, HSRIL will meet the home solutions requirement
is: In the value segment, the company will dedicate between 7,000 to 10,000
square feet in each Big Bazaar to sell furniture, furnishings and appliances.
The lifestyle demand for these products will be met through Centrals where the
company will earmark between 20,000 to 30,000 square feet of space for this
purpose. HSRIL is also setting
up
stand-alone stores dealing exclusively in these products to meet the
requirements of
lifestyle
customers. In addition to all of the above, the company is in process of
rolling out flagship stores called Home Town. Spread between 100,000- 150,000
square feet, each store will comprise of the following product categories; home
furniture, home furnishings, home building materials, home consumer
electronics, home appliances and home services (architects, designers,
financial products etc.) Home loans, building materials, sanitary ware,
white
goods, furniture, furnishings etc will all be available under one roof. The
wide product offerings will be backed by multiple options across different
price points-all at the best possible rates to attract customers from different
income segments into the store. Home Town is being positioned as a onestop-
shop, consumers would be able to stroll into the store and emerge with a
housecomplete with all the fittings and amenities. The company has already
signed up property in four locations-Bangalore, Gurgaon, Thane and Noida. The
first Home Town is
expected
to be operational in Gurgaon by the end of the 2005-06. Mr. Raghu Pillai, the
ex-CEO of the retail business of the RPG Group heads HSRIL. He is credited with
having built the group's retail businesses namely Food World, Spencer's &
Music World. As basic necessities get fulfilled, middle class India longs to
quench its thirst for leisure and entertainment. Still at a nascent stage, the
industry is expected to witness rapid growth as a result of the changes in
demographic and economic factors. Increasing urbanization and rising disposable
incomes
are characteristics that are common in emerging economies like India. Estimates
suggest
a growth in urban consumption at potentially 20% per annum in nominal terms for
at least the next 5-7 year period. The total number of middle- to high-income
households is projected to reach 105 million by 2010, thereby adding a large
number of people to the consuming class. There are 100 million 17-21 year olds
in India, and six out of ten households have a child that was born in the
post-liberalization era and has grown up with no guilt of consumption. These
demographic trends point towards an increasing wallet spend on leisure and
entertainment activities. Leisure and entertainment currently account for over
six percent of the aspirational consumer spend and this share is increasing
quickly. With the number of malls multiplying rapidly all over the country,
there is a heavy demand for quality entertainment options. The company has
identified this field as one of the potentia high growth areas. Its exposure to
consumers from various income segments and regional tastes have enabled it to
understand consumer behaviour well. The company expects to build on this
knowledge and come up with food courts, restaurants and family entertainment
centers for diverse income groups with value-for-money deals. As a start,
Pantaloon has acquired 15.73 per cent stake in Galaxy Entertainment Ltd. An
emerging player in the entertainment business,
Galaxy
has strong brand equity in Mumbai where it owns and operates Bowling Co.,
Sports Bar, Brew Bar, and Rain restaurant. This acquisition provides Pantaloon
an entry into one of the largest markets in India. The company is working on
launching different models to tap this segment in the future.
SUPPLYCHAIN MANAGEMENT
The
company's s'upply chain cell ensures the smooth and safe passage of merchandise
to
various stores. This cell is also responsible for assuring quality, vendor
management,
transportation
and managing factory outlets. Pantaloon's retail formats require a supply
chain
that is flexible enough to meet their diverse requirements, e.g. in case of
fashion
the
time to market is paramount, while in general merchandise, the cost to market
is
crucial.
Keeping these varied requirements in mind, the company set up its own supply
chain
and logistics model and this model has evolved with time and circumstances.
SUPPLY CHAIN AT
WORK IN PANTALOON
The
company's supply chain design revoves around a central warehouse and city
warehouses. The central warehouse is located at Tarapur, a suburb of Mumbai,
there are 13 regional warehouses located at different cities across the
country. The company follows different mechanisms for different products under
various formats. In case of fashion in lifestyle retailing, the entire stock is
delivered to the central warehouse. The merchandise is then allocated to
different stores by the respective category teams. For first time merchandise,
the allocation is done based on studies carried out by category, which include
multiple parameters, the store's racking capacity is also considered. For
existing merchandise, replenishment orders
are
generated by the Auto Replenishment System, which takes into account the sales
of the product in the store, the stock levels amongst other factors to forecast
replenishment requirements. In addition to central buying, there is also
restricted local buying. A unique aspect of the Pantaloons supply chain is the
factory outlet. It is the last link in the supply chain model and helps remove
unsold merchandise from the stores. Factory outlets ensure that merchandise
moves only in one direction, it is also a profitable way of divesting unsold
stock. In Big Bazaar, the merchandise is delivered directly from the
manufacturer/vendor to
different
city warehouses. When the store requires any merchandise, it calls for the
same. The goods can also be distributed amongst the stores based on the
allocation done by the category manager. In Food Bazaar, most of the products
are sourced locally by each store. Perishable
products
are sourced directly from the APMC. Non-perishables are supplied directly by
the suppliers. Food Bazaar uses the supply chain infrastructure (warehousing
& transportation)
only
for replenishment of its Private Label products from suppliers located in
different
parts
of India. The company outsources inter city transport of goods to third
parties. The intra city movement of goods from the warehouse to the stores is
handled by the company's own
fleet
of vehicles. B2B connectivity was established during the year with the top
vendors; with this the company will be able to work with vendors as a single
entity eliminating duplication.
In
addition to introducing more clarity and transparency with regard to vendor
relationship, it has also increased the efficiency of the procurement process
and brought down the procurement cost. The company was able to create a costing
cell within the organization; the purpose of this cell is to arrive at the
correct cost and mark up structure for different suppliers with the objective
of ensuring savings for the consumers and fair prices for suppliers. The
cell
is equipped with specialists from each business line.
STRATEGIC
DIRECTION
The
company is in the midst of upgrading the IT set up with the first step being a
strategic
relationship
with SAP, the world's leading business software solutions provider. The company
expects to implement my SAP Business Suite, SAP Advanced Planning Tool for
Merchandise Planning and SAP Apparel and Footwear Solutions. Currently, rnySAP
Business Suite is considered to be one of the premier business solutions
providing functionality, integration, scalability and collaboration. Pantaloon
is in the process of installing CCTV's at stores, using the VPN, live feeds from
the CCTV's will be relayed to the HO and the zones for interactive sessions
between the category and the store. This will compliment the video conferencing
facility that afready exists between the stores and the HO. To enable quicker
decision-making
and
reduce the ag time, different needs of different users are being addressed
through the creation of a personalized 'dash-board'. Individua users will be
able to receive alerts based on their
profiles and categories on various aspects related to stock, sales etc. Graphs
pertaining to key performance areas will be generated enabling better control
and informed decision-making.
The
company has begun to implement fully integrated transaction system, which would
accumulate
accurate real time data as each key function of the organization performs its
day-to-day
operations, this would include merchandise management, procurement,
manufacturing,
warehousing, logistics, inventory management, store operations and
customer
management. A data warehouse and Business Intelligence Tool are in the
process
of being installed, advanced corporate planning tools that facilitate decision
making in budgeting, forecasting, space planning and inventory planning are
being put in place.
In
order to improve visibility of data across the value chain, an enterprise
portal is being set
up.
This will be integrated with the company's core transaction system providing a
common
interactive
interface to share information with all stake holders; which includes vendors,
warehouses,
stores, customers and other business partners. The company's fast
paced expansion has led to an increase in the total employee strength from 3500
in 2003-04 to over ?;000 in 2004-05. Given the pace of expansion, the company
expects the total number of
employees
to more than double by the end of the coming year. Since the sector is in its
infancy,
retail based education has yet to take off in India. To create quality
personnel
equipped
with the skills and know how to manage this growth, Pantaloon has put in
place
certain initiatives that are expected to help the company in future
recruitment.
2004-05 vs. 2003-04
• The company reported the
Operating Income of Rs. 1084.01 Millions during 2004-05, an increase of 65 per
cent over the previous year.
• Profit before interest, depreciation
and tax increased from Rs.57.14 Millions in 2003-04 to Rs.90.84 Millions in
2004-05, while profit after tax rose from Rs. 19.78 Millions to Rs.38.55
Millions during the same period.
• Profit before interest,
depreciation and tax increased by 59 per cent and Profit after tax increased by
95 per cent over the previous year.
SURPLUS
MANAGEMENT
• The company generated a
cash profit of Rs.518.8 Millions as compared to Rs 285.7 Millionss in the last
year, registering the growth of 82 per cent. The cash outflow on account of
proposed dividend is Rs.62.7 Millions. The balance amount is ploughed back into
the business to fund the growth.
MARGINS
• Net margins improved from
3.00 per cent in 2003-04 to 3.56 percent in 2004-05.
CAPITAL
EMPLOYED
• The capital employed in
the business increased by Rs.176.84 `s in 2004-05. This is reflected in the
liabilities side of the balance sheet through an increase in borrowings by Rs.
500.9 Millions and an increase in equity by Rs. 1267.5 Millions. The ratio of
sales-to-average capital employed improved from 2.42 in 2003-04 to 2.59 in
2004-05.
CAPITAL
STRUCTURE
• The company's has
authorized capital (equity) of Rs.250.0 Millions comprising 25.0 Millions
equity shares of Rs. 10/- each.
• The paid up equity of
Rs.191.3 Millions as on 30/6/04 increased by Rs.28.6 Millions to Rs.219.9
Millions following the conversion of 2,13,547 10% Unsecured Fully Convertible
Debentures of Face Value Rs.1000/- in two tranches (on 10th October, 2004 and
15th April 2005) into 9,53,335 Equity Shares per tranche of Rs.10/- each at a
premium of Rs 102/- per share. Besides the company has also made the
preferential allotment of 9,53,653 Equity Shares of RslO/- each to Bennett,
Coleman and Company Limited at the premium of Rs 724.02/- per share
LOAN
PROFILE
• Loans increased from
Rs.2361.2 Millions in 2003-04 to Rs.2862.1 Millions in 2004-05.
• The Debt-equity ratio
(Term Debt to Net Worth) stood at 0.89 in 2004-05 as compared to 1.29 in
2003-04.
• The Debt-equity ratio
(Total Debt to Net Worth) stood at 1.29 in 2004-05 as compared to 1.85 in
2003-04.
CAPITAL
EXPENDITURE
• During 2004-05, the
company incurred a capital expenditure of Rs.695.5 Millions (including addition
in WTP). The capital expenditure incurred during the year is primarily on
account of opening of new stores and modification of the existing stores
INVESTMENT
• During the year,
investment in equity shares comprised of Rs. 318.8 Millions in subsidiaries,
associates and joint ventures.
The company has liquidated
long term investments for Rs.64.0 Millions
INTRA-GROUP
TRANSACTION
• The company buys fabric
from Pantaloon Industries Limited, a group company. The pricing of the fabric
is done at the prevailing market rates. The relationship between Pantaloon
Industries Limited and the company is professional and all dealings are
conducted at arms length.
GROSS
BLOCK SIZE AND NATURE OF ASSETS
• The company's gross block
(including capital work in progress) increased from Rs 1991.5 Millions 2003-04 to Rs 2669.0 Millions in 2004-05.
• Work in progress of Rs
157.9 Millions represents on-going projects
pending completion as on 30/06/05.
• The ratio of sales-to-gross
block-has improved from 3.56 in 2003-04 to 4.32 in 2004-05.
FOREIGN
EXCHANGE EARNINGS
• Foreign exchange earnings
have increased to Rs.260.4 Millions
in 2004-05 against Rs. 115.3 Millions
in 2003-04. This amount includes Rs. 145.7 Millions on account of indirect foreign exchange earned
through credit cards certified by Bankers.
• The foreign exchange outgo
was Rs. 260.5 Millions in 2004-05 against Rs. 169.5
Millions in 2003-04. A major increase
in the foreign exchange outgo was on account of import of Capital good (Rs.
86.8 Millions). The company expects
foreign exchange outgo to increase further in line with growth plans.
RATING
• The company's Commercial
Paper has been assigned "Fl (ind)" (F one ind) by Fitch Ratings India
Private Limited.
OUTLOOK
• The outlook for the company is buoyant. With two new
line of businesses home and leisure and entertainment Pantaloon will be able to
address in excess of 60% of the customer's wallet. Besides, with more than 10
million square feet of retail space signed, the company is on for an aggressive
roll out. The company has also expanded its formats by acquiring 49%
stake in Planet Sports Private Limited and
introducing, Fashion Station, aLL and Mela. With the AMC business through PFH
Investment Advisory Company Limited, Pantaloon is participating in the property
space. The consumer sentiment in India is rising by the day, this is reflected
in same store growth of around 30% in value retailing and around 19% in
lifestyle
retailing in August 2005 and that is encouraging. As a
company we are confident than ever before and want to make the most of the
first mover advantage.
THE
YEAR IN RETROSPECT
NEW
RETAIL CONCEPTS
Fashion Station Fashion ka
big bazaar The company during the year launched "Fashion Station" a
new format in Value Retailing. It deals with fashion categories of Big Bazaar
& some private lables of Pantaloons. It stocks private labels apparel of Big
Bazaar stores and
other private label of
fashion merchandise will be developed over a period of time. First store of
this kind was opened in Mulund, Mumbai. The store is positioned between Big
Bazaar & Pantaloons that caters to the 'Youth' wanting affordable fashion.
The store will be developed as smaller big bazaar for fashion merchandise. The
store is a higher store margin than Big
Bazaar and will be competing
with other departmental stores in fashion merchandise. The company has
aggressive roll out plan for Fashion Station.
STRATEGIC
INVESTMENT
PLANET
SPORTS PRIVATE LIMITED
Pantaloon, formed up a
strategic Joint Venture Agreement (JVA) with the renowned speciality retailer
Planet Sports during the year. The company has subscribed to 49 per cent
equity in Planet Sports
Private Ltd. Supreme Tradelinks Private Limited a wholly owned
subsidiary of Planet Sports
Private Limited is the sole franchisee of the prestigious UK-based retailer :
Marks and Spencer in India. It also has the exclusive distribution/ licensing
rights for well-known brands
including Wilson, Puma, Speedo, Converse, Guess & Planet Sports, among
others.
GALAXY
ENTERTAINMENT CORPORATION LIMITED
PRIL has taken 15.73 % stake
in Galaxy Entertainment Limited through preferential allotment. Post
subscription, Pantaloon is likely to come out with a mandatory 20 per cent open
offer to the shareholders of Galaxy Entertainment Limited. The draft offer
letter is pending before SEBI for their approval as on the date. Galaxy owns
and operates Sports Bar, Bowling Co. and Rain
Restaurant in Mumbai. Growth
in entertainment, food & beverages, leisure business will be facilitated by
the strong presence and availability of prime space that Pantaloon has in malls
across the country. Galaxy Entertainment Corporation Limited will also gain
from the management bandwidth that Pantaloon has.
FOOTWEAR
JOINT VENTURE
The company is proposed to
enter into Joint Venture with Liberty Shoes Limited for setting up a chain of
stores for retailing of footwear and other accessories. The proposed Joint
Venture will combine the retail expertise of the company and design sourcing
and merchandising expertise of Liberty Shoes Limited. This will provide a
focused attention to footwear category, which commands a sizeable portion of the
consumer spending. The company will hold
51% and Liberty will hold
49% stake in the new company.
TIE
UP WITH EDUCATIONAL INSTITUTIONS FOR CREATING
STRONG
MANAGEMENT BANDWIDTH FOR THE FUTURE
Retail is still in a nascent
stage in the country and professionals with expertise in this field are few.
With a view to creating a strong management base, the company has tied up with
some renowned educational institutions like Somaiya Institute of Management
Studies & Research &
Welingkar Institute of
Management Development & Research. Under an exclusive tie up with PRIL,
these institutions admit using stringent admission procedures candidates from
all across the country. These candidates are then exposed to quality academic
inputs from the institutions and practical on the job experience from PRIL. At
the end of the duration of the course all candidates are expected to be
absorbed by the company. The first such batch
of 35 students will be
inducted into PRIL management ranks during the course of this financial year. In
the coming years, the number of students coming through these courses is
expected to increase
significantly.
ISSUE
OF PREFERENTIAL EQUITY DURING THE YEAR
Your Company had made a
preferential allotment of 9,53,335 equity shares of 10/- each at premium of Rs.
102 /- per share on 26th October 2004 to promoters and associates on
conversion of first tranche
of 10% 2,13,547 unsecured fully convertible debentures of Rs. 1000/- each
issued on llth November 2003. Company had made a preferential allotment of 9,53,653
equity shares of Rs. 10/- each at a premium of Rs. 724.02 per share to Bennett,
Coleman & Company Limited on llth February 2005. The second tranche of
conversion of unsecured fully convertible debentures into 9,53,335 equity
shares of Rs. 10/- each at a
premium of Rs. 102/- per
share to promoters and associates was made on 15th April 2005.
RIGHTS
ISSUE
The Board of Directors in
their meeting held on August 24, 2005 approved rights issue of one equity share
for every five shares held by shareholders in the company at price of Rs.500/-
per share. A total of Rs. 2240.5 Millions will be mobilized through the issue
will be utilized for the expansion plans of the Company.
I
MAGE AWARDS 2005 FIXED DEPOSITS
Image Awards ceremony is
held every year to recognize the companies that have made a significant impact
in the Indian retailing environment both from the consumer and industry
perspective. This year your
cortfpany has won five awards. The categories in which the awards were won are
as follows: a) Retailer of the Year: Food & Grocery- Food Bazaar b)
Retailer of the Year: Value Retailing- Big Bazaar c) Most Admired Retailer of
the Year- Pantaloon Retail (India) Limited d) Retail Launch of the Year-
Central e) Retail Face of the Year- Kishore Biyani
THE
FUTURE
The company has drawn up an
aggressive expansion plan for the future. Total retail space at the end of
2004-05 stood at over 1.9 million square feet with around 1 million square feet
being added in the year
under review. The company will further step up the pace of expansion and based
on the space currently signed expects 3.5 million square feet to be operational
by June 2006 and 7 million square feet by June 2007.
SUBSIDIARY
COMPANIES
During the year the
following companies became subsidiaries of the Company. a)Home Solutions Retail
(India) Limited was incorporated on October 4, 2004 to offer solutions in home
furnishings, furniture, consumer durables, etc. The company has 66.66% stake in
Home Solutions Retail (India) Limited. b) PFH Investment Advisory Company
Limited was incorporated on December 31, 2004.The main business of PFH
Investment Advisory Company Limited is to carry on the business of providing
financial investment advisory services, management and facilitation services.
The company has-76.00% stake in PFH Investment Advisory Company Limited.
c) PAN India Restaurants
Limited was incorporated on February 7, 2005. The main business of PAN India
Restaurants Limited is to carry on the business of quick service restaurants
and food courts through restaurants, food court, hotels, eating house etc. The
company has
98.46% stake in PAN India
Restaurants Limited.
d) Pantaloon Food Product
(India) Limited was incorporated on April 13, 2005. The main business of supply
of Food products. The company has 100.00% stake in Pantaloon Food Product
(India) Limited.
|
NAME OF SUBSIDIARY COMPANY |
% OF HOLDINGS AS ON 30/06/2005 |
|
Home Solutions Retail (India) Limited |
66.66% |
|
Pantaloon Food Product (India) Limited |
100.00% |
|
Pan India Restaurants Limited |
98.46% |
|
PFH Investment Advisory Company Limited |
76.00% |
INTERNET
ACCESS: WWW.PANTALOON.COM
The website of the Company contains all relevant
information about the pantaloon family. The Annual Reports, Shareholding
pattern, unaudited quarterly results and all other material information are
hosted in this
CMT REPORT [Corruption, Money laundering & Terrorism]
The
Public Notice information has been collected from various sources including but
not limited to: The Courts, India Prisons Service, Interpol, etc.
1] INFORMATION
ON DESIGNATED PARTY
No exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.
2] Court
Declaration :
No records exist to suggest that subject is or was the
subject of any formal or informal allegations, prosecutions or other official
proceeding for making any prohibited payments or other improper payments to
government officials for engaging in prohibited transactions or with designated
parties.
3] Asset
Declaration :
No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.
4] Record
on Financial Crime :
Charges or conviction registered
against subject: None
5] Records
on Violation of Anti-Corruption Laws :
Charges or investigation registered
against subject: None
6] Records
on Int’l Anti-Money Laundering Laws/Standards :
Charges or investigation registered
against subject: None
7] Criminal
Records
No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.
8] Affiliation
with Government :
No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.
9] Compensation
Package :
Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.
10] Press Report :
No press reports / filings exists on the subject.
CORPORATE
GOVERNANCE
MIRA
INFORM as part of its Due Diligence do provide comments on Corporate Governance
to identify management and governance. These factors often have been predictive
and in some cases have created vulnerabilities to credit deterioration.
Our
Governance Assessment focuses principally on the interactions between a
company’s management, its Board of Directors, Shareholders and other financial
stakeholders.
CONTRAVENTION
Subject
is not known to have contravened any existing local laws, regulations or
policies that prohibit, restrict or otherwise affect the terms and conditions
that could be included in the agreement with the subject.
FOREIGN
EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US
Dollar |
1 |
Rs. 44.93 |
|
UK
Pound |
1 |
Rs. 83.82 |
|
Euro |
1 |
Rs. 57.35 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
64 |
This score
serves as a reference to assess SC’s credit risk and to set the amount of
credit to be extended. It is calculated from a composite of weighted scores
obtained from each of the major sections of this report. The assessed factors
and their relative weights (as indicated through %) are as follows:
Financial condition (40%) Ownership background (20%) Payment record (10%)
Credit history (10%) Market trend (10%) Operational
size (10%)
RATING
|
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely
sound financial base with the strongest capability for timely payment of
interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate
working capital. No caution needed for credit transaction. It has above
average (strong) capability for payment of interest and principal sums |
Large |
|
56-70 |
A |
Financial &
operational base are regarded healthy. General unfavourable factors will not
cause fatal effect. Satisfactory capability for payment of interest and
principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is
considered normal. Capable to meet normal commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable &
favourable factors carry similar weight in credit consideration. Capability
to overcome financial difficulties seems comparatively below average/normal. |
Small |
|
11-25 |
Ca |
Adverse factors are
apparent. Repayment of interest and principal sums in default or expected to
be in default upon maturity |
Limited with full
security |
|
<10 |
C |
Absolute credit risk
exists. Caution needed to be exercised |
Credit not recommended |