MIRA INFORM REPORT

 

 

Report Date :

08.04.2008

 

IDENTIFICATION DETAILS

 

Name :

TTK PRESTIGE LIMITED

 

 

Registered Office :

11th Floor, Brigade Towers, 135 Brigade Road, Bangalore 560025, Karnataka

 

 

Country :

India

 

 

Financials (as on) :

31.03.2007

 

 

Date of Incorporation :

22.10.1955

 

 

Com. Reg. No.:

001750

 

 

CIN No.:

[Company Identification No.]

U31909KA1955PLC001750

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

CHET00535D

 

 

PAN No.:

[Permanent Account No.]

AAACT6503G

 

 

Legal Form :

It is a public limited liability company. The company’s shares are listed on the Stock Exchanges.

 

 

Line of Business :

Manufacturing and Marketing of Pressure Cookers & Pans, Cookware Items, Sterilizer, Wheel Skin, Weighing Scales, Barbecue, Idli Stand, Personal Care Products and Kitchen Knives

 

 

RATING & COMMENTS

 

MIRA’s Rating :

A

 

RATING

STATUS

PROPOSED CREDIT LINE

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

 

Maximum Credit Limit :

USD 2200000

 

 

Status :

Good

 

 

Payment Behaviour :

Regular

 

 

Litigation :

Clear

 

 

Comments :

Subject is a well established and reputed company. Trade relations are fair.  Business is active.  General financial position is satisfactory.  Payments are reported as usually correct and as per commitments.

 

The company can be considered normal for business dealings at usual trade terms and conditions.

 

 

LOCATIONS

 

Registered Office :

11th Floor, Brigade Towers, 135 Brigade Road, Bangalore 560025, Karnataka, India

Tel. No.:

91-80-22217438/39

Fax No.:

91-80-22277446

E-Mail :

ks@ttkprestige.com

Website :

www.ttkprestige.com

 

 

Factory 1 :

78 Old Madras Road, Dooravaninagar, Bangalore – 560 016, Karnataka, India

 

 

Factory 2 :

82 & 85, Sipcot Industrial Complex, Hosur Dharmapuri District, Tamilnadu – 635 126, India

 

 

Branches :

Located at :

Ahmedabad, Bangalore, Chennai, Cuttack, Delhi, Ernakulam, Ghaziabad, Guwahati, Hyderabad, Indore, Jaipur, Kolkata, Ludhiana, Mumbai, Patna, Pune, Trichy and Vijayawada.

 

 

DIRECTORS

 

Name :

Mr. T. T. Jagannathan

Designation :

Chairman

 

 

Name :

Mr. S. Ravichandran

Designation :

Director

 

 

KEY EXECUTIVES

 

Name :

Mr. K. Shankaran

Designation :

Company Secretary

 

 

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

 

[As on 31.12.2007]

 

Names of Shareholders

No. of Shares

Percentage of Holding

Individuals / Hindu Undivided Family 

1317724

11.61

Bodies Corporate

14800

0.13

Partnership firm through partners

6880440

60.63

Mutual Funds/UTI

222658

1.96

Financial Institutions / Banks

3379

0.03

Foreign Institutional Investors

162011

1.43

Bodies Corporate

349431

3.08

Individuals-

i. Individual shareholders holding nominal share capital up to Rs. 0.100 Million

1599848

14.10

ii. Individual shareholders holding nominal share capital in excess of Rs. 0.100 Million

658046

5.80

Any other specify

2100

0.01

Non Resident Indians

114407

1.01

Clearing Members

23480

0.21

 

 

BUSINESS DETAILS

 

Line of Business :

Manufacturing and Marketing of Pressure Cookers & Pans, Cookware Items, Sterilizer, Wheel Skin, Weighing Scales, Barbecue, Idli Stand, Personal Care Products and Kitchen Knives

 

 

GENERAL INFORMATION

 

No. of Employees :

769

 

 

Bankers :

Bank of Baroda

Corporate Banking Branch, HJS Complex, 1st Floor, No. 26, Richmond Road, Bangalore – 560 025, Karnataka.

 

 

 

Banking Relations :

Good

 

 

Auditors :

 

Name :

S. Viswanathan

Chartered Accountants

Address :

27/34, II Floor, Nandi Durg Road, Jayamahal Extension, Bangalore – 560 046, Karnataka, India

 

 

Memberships :
  • Confederation of Indian Industry

 

 

Subsidiaries:
  • Manttra Inc., USA

 

 

Associates:
  • KIWI TTK Limited
  • London Rubber Company (India) Limited
  • Peenya Packaging Products
  • Prestige Housewares India Limited
  • RAS Transformation Technology (Private) Limited
  • Softel Machines Limited
  • T T Industries & Textiles Limited
  • T T K Pharma Limited
  • TT Kitchenwares Limited
  • TT Krishnamachari & Company
  • TTK Healthcare Limited
  • TTK LIG Limited
  • TTK Services (Private) Limited
  • TTK Services Private Limited
  • TTK Tantex Limited
  • TTK Textiles Limited

 

 

 

CAPITAL STRUCTURE

 

Authorised Capital :

No. of Shares

Type

Value

Amount

15000000

Equity Shares

Rs. 10/- each

Rs. 150.000 Millions

 

Issued, Subscribed & Paid-up Capital :

No. of Shares

Type

Value

Amount

11333884

Equity Shares

Rs. 10/- each

Rs. 113.338 Millions

 

 

 

FINANCIAL DATA

[all figures are in Rupees Millions]

 

ABRIDGED BALANCE SHEET

 

SOURCES OF FUNDS

 

31.03.2007

31.03.2006

31.03.2005

SHAREHOLDERS FUNDS

 

 

 

1] Share Capital

113.300

113.300

113.300

2] Share Application Money

0.000

0.000

0.000

3] Reserves & Surplus

437.700

359.900

322.900

4] (Accumulated Losses)

0.000

0.000

0.000

NETWORTH

551.000

473.200

436.200

LOAN FUNDS

 

 

 

1] Secured Loans

469.200

461.500

531.400

2] Unsecured Loans

266.100

111.000

118.000

TOTAL BORROWING

735.300

572.500

649.400

DEFERRED TAX LIABILITIES

0.000

0.000

0.000

 

 

 

 

TOTAL

1286.300

1045.700

1085.600

 

 

 

 

APPLICATION OF FUNDS

 

 

 

 

 

 

 

FIXED ASSETS [Net Block]

295.700

243.200

249.300

Capital work-in-progress

62.600

9.300

1.300

 
 

 

 

INVESTMENT

181.200

181.200

151.300

DEFERREX TAX ASSETS

0.000

0.000

0.000

 

 

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

 

 

 

Inventories
739.000

572.900

554.200

 

Sundry Debtors
413.200

277.000

322.200

 

Cash & Bank Balances
67.400

92.600

86.300

 

Other Current Assets
0.000

0.000

0.000

 

Loans & Advances
179.200

138.800

133.500

Total Current Assets
1398.800

1081.300

1096.200

Less : CURRENT LIABILITIES & PROVISIONS
 

 

 

 

Current Liabilities
574.800

423.900

388.100

 

Provisions
78.300

47.700

27.800

Total Current Liabilities
653.100

471.600

415.900

Net Current Assets
745.700

609.700

680.300

 

 

 

 

MISCELLANEOUS EXPENSES

1.100

2.300

3.400

 

 

 

 

TOTAL

1286.300

1045.700

1085.600

 

 

PROFIT & LOSS ACCOUNT

 

PARTICULARS

 

31.03.2007

31.03.2006

31.03.2005

Sales Turnover

2932.500

2318.300

1893.700

Other Income

6.600

7.500

31.900

Total Income

2939.100

2325.800

1925.600

 

 

 

 

Profit/(Loss) Before Tax

166.000

120.000

38.400

Provision for Taxation

48.300

48.900

0.300

Profit/(Loss) After Tax

117.700

71.100

38.100

 

 

 

 

Expenditures :

 

 

 

 

Raw Materials

1616.400

1188.600

1019.000

 

Excise Duty

118.500

99.300

86.600

 

Power & Fuel Cost

29.200

29..000

25.800

 

Other Manufacturing Expenses

42.300

29.300

23.800

 

Employee Cost

178.300

165.400

150.500

 

Selling and Administration Expenses

732.900

572.800

437.900

 

Miscellaneous Expenses

39.500

38.500

67.500

 

Interest & Financial Charges

80.500

66..200

72.900

 

Depreciation

22.000

18.900

18.700

 

Stock Adjustment

[86.500]

[2.200]

[15.500]

Total Expenditure

2773.100

2205.800

1887.200

 

 

QUARTERLY RESULTS

 

PARTICULARS

 

30.06.2007

30.09.2007

31.12.2007

Type

1st Quarter

2nd Quarter

3rd Quarter

Sales Turnover

757.100

881.800

987.700

Other Income

5.600

1.800

0.100

Total Income

762.700

883.600

987.800

Total Expenditure

683.400

793.100

889.100

Operating Profit

79.300

90.500

98.700

Interest

22.000

19..900

18.500

Gross Profit

57.300

70.600

80.200

Depreciation

6..600

7.400

8.000

Tax

6.900

8.200

9.100

Reported PAT

42.800

52.300

62.400

 

KEY RATIOS

 

PARTICULARS

 

31.03.2007

31.03.2006

31.03.2005

Debt-Equity Ratio

1.36

1.45

1.79

Long Term Debt-Equity Ratio

0.80

0.78

0.91

Current Ratio

1.49

1.50

1.47

Fixed Assets

5.12

4.38

3.45

Inventory

4.47

4.11

3.46

Debtors

8.50

7.74

5.73

Interest Cover Ratio

3.06

2.81

1.45

Operating Profit Margin(%)

9.16

8.85

6.58

Profit Before Interest And Tax Margin(%)

8.41

8.03

5.60

Cash Profit Margin(%)

4.76

3.88

2.74

Adjusted Net Profit Margin(%)

4.01

3.07

1.75

Return On Capital Employed(%)

21.77

18.08

9.64

Return On Net Worth(%)

24.51

16.86

8.36

 

 

LOCAL AGENCY FURTHER INFORMATION

 

The company is in trade terms with :

 

 

 

REVIEW OF PERFORMANCE 

 
The Company continued to travel on the aggressive growth path both in terms of volume and value. During the year ended 31st March 2007, the Company registered 26.5% growth in sales. The Company could have achieved a higher growth, but for the industrial unrest that affected the Hosur manufacturing complex of the Company during November 2006 to March 2007.

Though the Company had made alternative arrangements, certain specific items and export models could not be manufactured, thus affecting the sales and profits to an extent. The Company achieved a Pre-tax profit of 166.000 Millions thus registering a growth of 38% while the Post tax Profit registered a growth of 66% from Rs. 71.100 Millions to Rs.117.700 Millions. Earnings per Share grew from Rs.6.27 to Rs.10.37. 

MANAGEMENTS' DISCUSSION AND ANALSYIS 

A. INDUSTRY SCENARIO 

The buoyancy seen in the economy in the last few years continued during 2006-07. Notwithstanding a higher rate of inflation affecting the disposable income of the people, the consumer off take was encouraging. 

The Company operates in the kitchen appliances segment with a wide range of product categories consisting of Pressure Cookers, Non-stick Cookware, Gas Stoves and Domestic Kitchen Appliances. The key product category of the Company is Pressure Cookers which is shared amongst organized national branded players, regional players and unorganized players. The market is equally divided between organized branded players and others. In the other product categories also, the market structure is similar but the share and role of regional brands and unorganized players is quite high. 

B. OPPORTUNITIES, THREATS AND COMPANY'S RESPONSE  

The Company has been building upon its core strengths of brand, manufacturing, designing, distribution, sourcing and service capabilities.

These strengths and the buoyancy in the domestic economy over the past four years have been presenting interesting opportunities and the Company has been taking advantage of the same wherever viable besides creating opportunities for itself. Thus the Company has been able to firmly establish its brand over several product categories travelling beyond pressure cookers and earn the recognition for Prestige as the Super Brand in the kitchen appliance category. Such exploitation of opportunities has made possible the achievement of a compounded average growth rate of over 25% in the last four years. As mentioned in the last report, it will be the Company's endeavour to pursue continuous introduction of new products, expansion and consolidation of its exclusive retail chain Prestige Smart Kitchen', tapping the emerging large and medium retail formats, rural and export markets. 

The threats continue to be from unorganized players and regional brands that compete with unviable low pricing strategies. The Company has been adopting different strategies to stay above such competition and has also been growing at a pace faster than the industry average. Competition from China continues to be a threat in the export markets. 

C. ANALYSIS OF PERFORMANCE: 

a. The company operates in a single segment-Kitchen Appliances. The products include Pressure Cookers, Non-stick Cookware, Kitchen Electrical Appliances and Gas Stoves. The turnover of these product categories is given in the following table. 

b. Domestic Sales registered a growth of 28.75 % while exports remained at the same level. The industrial unrest in the last four months of the year under report affected sales especially against export orders. 

c. The growth in non-traditional product lines like kitchen electrical appliances and gas stoves has been very impressive at 79% and 40% respectively. 

d. In spite of severe cost push due to high aluminum and steel prices, the Company was able to improve its EBIDTA/Sales ratio to 8.75% through operational efficiencies. 

e. The Company's new products including Prestige Nakshatra are well received in the market. The number of new products launched was 89 in 7 categories. Selective introduction of Modular kitchens is showing encouraging response. 

f. Expansion of exclusive Prestige Smart Kitchen retail net work was carried out at a greater pace than budgeted. The number of outlets as at the end of 31.3.2007 was180 (Previous Year 80). The network now covers 11 States and 111 towns. The network contributes to nearly 15% of domestic sales. 

g. The increase in absolute interest burden was directly as a result of increased level of borrowing caused by higher investments in working capital and ongoing capital expenditure programmes. However interest as a ratio to Sales has been coming down steadily and stood at 2.3%. 

D. OUTLOOK 

The opportunities that are available to the Company and the strategy to exploit them have already been detailed in the preceding sections. During the year 2007-08 the Company will focus on consolidation, improvement in revenue realizations and asset productivity. 

AS PER WEBSITE DETAILS:

 

PRESS RELEASE

 

TTK Prestige implementing total transformation process

 

TTK Prestige Limited, the pressure cooker major is on the path of bringing about total transformation encompassing all its facets and thus bring about enhancement in long term shareholder value. The company has engaged external management consultants to bring about organisational transformation and to build up long range plan which amongst others involves substantial expansion of the product range in the domestic appliances segment and extension of the Prestige brand across the product category. The company has already extended “Prestige” brand to Flasks and Gas Stoves which are being well received in the market. The other products in the range of domestic appliances are being actively examined.

The transformation process includes the following:

For the year ended 31st March, 2000 the company has achieved a total income of Rs.1400 Millions as compared to Rs.1470 Millions in the previous year.

 

 

 

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. 39.93

UK Pound

1

Rs. 79.34

Euro

1

Rs. 62.55

 

 

SCORE & RATING EXPLANATIONS

 

SCORE FACTORS

 

RANGE

POINTS

HISTORY

1~10

8

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

8

--LEVERAGE

1~10

8

--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

YES

--EXPORT ACTIVITIES

YES/NO

YES

--AFFILIATION

YES/NO

YES

--LISTED

YES/NO

YES

--OTHER MERIT FACTORS

YES/NO

YES

TOTAL

 

67

 

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 EXPLANATIONS

 

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.

 

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

NR

In view of the lack of information, we have no basis upon which to recommend credit dealings

No Rating

 

 

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions