MIRA
INFORM REPORT
|
Report Date : |
23.07.2011 |
IDENTIFICATION DETAILS
|
Name : |
ZODIAC CLOTHING COMPANY
LIMITED |
|
|
|
|
Registered
Office : |
Apte Properties,
10/76, Off |
|
|
|
|
Country : |
|
|
|
|
|
Financials (as
on) : |
31.03.2010 |
|
|
|
|
Date of
Incorporation : |
14.06.1984 |
|
|
|
|
Com. Reg. No.: |
11-033143 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs.83.927
millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
L17100MH1984PLC033143 |
|
|
|
|
TAN No.: [Tax Deduction &
Collection Account No.] |
MUMZ01061E MUMZ00986G MUMZ01166E |
|
|
|
|
PAN No.: [Permanent Account No.] |
AAACZ0151A |
|
|
|
|
Legal Form : |
Public limited liability company. Company’s shares are
listed on the Stock Exchanges. |
|
|
|
|
Line of Business
: |
Manufacture and Distribution
of Men's Clothing, including Shirts, Ties, Socks and Trousers. |
|
|
|
|
No. of Employees
: |
3500 (Approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
A (64) |
|
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 5594000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a well established and reputed company and a part of Zodiac
Group. Directors are reported as experienced and respectable businessmen.
General financial position is good. Trade relations are reported as fair.
Business is active. Payments are reported to be regular and as per
commitments. The company can be considered good for normal business dealings at
usual trade terms and conditions. |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – April 1, 2010
|
Country Name |
Previous Rating (31.12.2009) |
Current Rating (01.04.2010) |
|
|
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
LOCATIONS
|
Registered/ Corporate Office : |
Apte Properties,
10/76, Off |
||||||||||||||||||||||||||||
|
Tel. No.: |
91-22-66677000 |
||||||||||||||||||||||||||||
|
Fax No.: |
91-22-66677279 |
||||||||||||||||||||||||||||
|
E-Mail : |
|||||||||||||||||||||||||||||
|
Website : |
|||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||
|
Factory 1 : |
Yelahanka, |
||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||
|
Factory 2 : |
|
||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||
|
Factory 3 : |
Bommasandra, |
||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||
|
Factory 4 : |
Koramangala, |
||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||
|
Factory 5 : |
A-1, 181/1, GIDC,
Umbergaon, Valsad - 396 171, |
||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||
|
Factory 6 : |
C/2/7, GIDC,
Industrial Area, Umbergaon, Valsad - 396 171, |
||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||
|
Factory 7 : |
Plot No. 411, Unit
II, GIDC Umbergaon, Valsad - 396 171, |
||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||
|
Factory 8 : |
A to Z Industrial
Area, Lower Parel, Mumbai - 400 011, |
||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||
|
Retail Stores : |
Located at:
|
||||||||||||||||||||||||||||
|
|
|
DIRECTORS
As on 31.03.2010
|
Name : |
Mr. M. Y. Noorani |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Dr. S. Abid
Hussain |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. M. L. Apte |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Bernhard
Steinruecke |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. S. M. Datta |
|
Designation : |
Director |
|
|
|
|
Name : |
Dr.
Heinrich-Dietrich Dieckmann |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Deepak Parekh |
|
Designation : |
Director
(Alternate to Dr. Heinrich Dieckmann) |
|
|
|
|
Name : |
Mr. S. R. Iyer |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Y. P. Trivedi |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. A. Y. Noorani |
|
Designation : |
Vice Chairman and
Managing Director |
|
|
|
|
Name : |
Mr. S. Y. Noorani |
|
Designation : |
Managing Director
and President |
KEY EXECUTIVES
|
Name : |
Mr. Shivatosh
Chakraborty |
|
Designation : |
Company Secretary |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 30.06.2011
|
Category of Shareholder |
No. of Shares |
Percentage of Holding |
|
(A) Shareholding of Promoter and Promoter Group |
|
|
|
|
|
|
|
|
1,724,381 |
13.45 |
|
|
1,545,156 |
12.05 |
|
|
3,269,537 |
25.50 |
|
|
|
|
|
|
187,550 |
1.46 |
|
|
4,206,510 |
32.81 |
|
|
4,394,060 |
34.27 |
|
Total shareholding of Promoter and Promoter Group (A) |
7,663,597 |
59.77 |
|
(B) Public Shareholding |
|
|
|
|
|
|
|
|
442,986 |
3.46 |
|
|
75 |
- |
|
|
2,161,957 |
16.86 |
|
|
2,605,018 |
20.32 |
|
|
|
|
|
|
834,975 |
6.51 |
|
|
|
|
|
|
842,434 |
6.57 |
|
|
533,122 |
4.16 |
|
|
341,918 |
2.67 |
|
|
325,918 |
2.54 |
|
|
137 |
- |
|
|
15,863 |
0.12 |
|
|
2,552,449 |
19.91 |
|
Total Public shareholding (B) |
5,157,467 |
40.23 |
|
Total (A)+(B) |
12,821,064 |
100.00 |
|
(C) Shares held by Custodians and against which Depository Receipts
have been issued |
- |
- |
|
|
- |
- |
|
|
- |
- |
|
|
- |
- |
|
Total (A)+(B)+(C) |
12,821,064 |
- |
(1) Indian
Individuals / Hindu Undivided Family
Individual shareholders holding nominal
share capital up to Rs.0.100 million BUSINESS DETAILS
|
Line of Business : |
Manufacture and
Distribution of Men's Clothing, including Shirts, Ties, Socks and Trousers. |
||||||||||||||||
|
|
|
||||||||||||||||
|
Products : |
|
PRODUCTION STATUS (AS ON 31.03.2010)
|
Particulars |
Unit |
Licensed
Capacity |
Installed
Capacity |
Actual
Production* |
|
Garment and
Accessories |
Pcs |
N. A. |
6,182,000 |
4,277,474 |
|
|
|
|
|
|
* Includes 821,408 Pcs
manufactured by outside parties on behalf of the Company.
GENERAL INFORMATION
|
No. of Employees : |
3500 (Approximately) |
||||||||||||||||||
|
|
|
||||||||||||||||||
|
Bankers : |
v IDBI
Bank, Mittal Tower, C-Wing, Nariman Point, Mumbai – 400 021, v Dena Bank,
Industrial Finance Branch, v Central
Bank of v ABN Amro
Bank N.V., 74, Sakhar Bhavan, Nariman Point, Mumbai -400 021, v Citi
Bank N.A., Citi Tower, 61, Dr. S. S. Rao Road, Parel, Mumbai-400012,
Maharashtra, India v
State Bank of v
Citi Bank N.A., Citi Bank Centre, Bandra –
Kurla Complex, Bandra (East), Mumbai – 400 051, v
The
Royal Bank of |
||||||||||||||||||
|
|
|
||||||||||||||||||
|
Facilities : |
|
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Statutory Auditors : |
|
|
Name : |
Deloitte Haskins
and Sells Chartered
Accountants |
|
Address : |
12, |
|
|
|
|
Internal Auditors : |
|
|
Name : |
Bhandarkar and
Kale Chartered
Accountants |
|
Address : |
Lentin Chambers,
Fort, Mumbai, |
|
|
|
|
Solicitors : |
A.H. Parpia and
Company Address: 203/204
Prabhat House, 2nd Floor, 92, Kanga and Company Address: |
|
|
|
|
Subsidiaries : |
v
Multiplex
Collapsible Tubes Limited v
Zodiac
Clothing Company S.A. ( v
Zodiac
Clothing Company (UAE) LLC v
Zodiac
Clothing Company Inc. v
Zodiac
Properties Limited (Subsidiary w.e.f. 22nd November, 2009) |
|
|
|
|
Other Related Parties : |
v
Zodiac
Private Limited v
Miraj
Marketing Company Private Limited v
Zodiac
Metropolitan Clothing Gmbh v
v
Metropolitan
Trading Company v
Montage
Corporation v
Munraz
Enterprises v
Mariambai
and Haji Noor Mohamad Noorani Foundation Trust v
Mustang
Manufacturing Company v
Mashal
Enterprises v
Elite
Clothing Company Private Limited v
Euro
Global Holdings Pte Limited v
Onward
LLC |
CAPITAL STRUCTURE
After 10.08.2010
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
20000000 |
Equity Shares |
Rs.10/- each |
Rs.200.000 millions |
|
|
|
|
|
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
12821064 |
Equity Shares |
Rs.10/- each |
Rs.128.211
millions |
|
|
|
|
|
As on 31.03.2010
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
20000000 |
Equity Shares |
Rs.10/- each |
Rs.200.000 millions |
|
|
|
|
|
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
8392676 |
Equity Shares |
Rs.10/- each |
Rs.83.927
millions |
|
|
|
|
|
Notes:
1) Of the above,
i) 1,156,313 Shares are
allotted as fully paid-up pursuant to the scheme of amalgamation of Mayfair
Limited with the Company;
ii) 4,181,313 Shares
are allotted as fully paid-up by way of bonus shares by capitalisation of share
premium account; and
iii) 30,050 Shares
are allotted as fully paid-up on exercise of Employee stock options under
Zodiac Clothing Company Limited Employee Stock Option Plan 2006
2) Particulars of
options on unissued share capital
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
83.927 |
83.865 |
83.862 |
|
|
2] Share Warrant |
0.000 |
17.600 |
17.600 |
|
|
3] Reserves & Surplus |
1314.553 |
1093.143 |
1066.483 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
1398.480 |
1194.608 |
1167.945 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
320.702 |
246.061 |
231.490 |
|
|
2] Unsecured Loans |
0.000 |
0.000 |
0.000 |
|
|
TOTAL BORROWING |
320.702 |
246.061 |
231.490 |
|
|
DEFERRED TAX LIABILITIES |
18.678 |
17.950 |
16.539 |
|
|
|
|
|
|
|
|
TOTAL |
1737.860 |
1458.619 |
1415.974 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
505.402 |
485.852 |
402.337 |
|
|
Capital work-in-progress |
90.687 |
33.963 |
22.694 |
|
|
|
|
|
|
|
|
INVESTMENT |
128.738 |
128.738 |
299.008 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
499.598
|
468.247 |
472.006
|
|
|
Sundry Debtors |
221.446
|
219.259 |
180.436
|
|
|
Cash & Bank Balances |
207.083
|
104.796 |
27.354
|
|
|
Other Current Assets |
0.000
|
0.000 |
0.000
|
|
|
Loans & Advances |
472.162
|
474.958 |
383.679
|
|
Total
Current Assets |
1400.289
|
1267.260 |
1063.475 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
160.800
|
155.822 |
168.413 |
|
|
Other Current Liabilities |
148.045
|
224.688 |
132.791
|
|
|
Provisions |
78.411
|
76.684 |
70.336
|
|
Total
Current Liabilities |
387.256
|
457.194 |
371.540 |
|
|
Net Current Assets |
1013.033
|
810.066 |
691.935 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
1737.860 |
1458.619 |
1415.974 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
|
|
SALES |
|
|
|
|
|
|
|
Sales |
2666.457 |
2667.010 |
2282.346 |
|
|
|
Other Income |
206.064 |
193.489 |
201.496 |
|
|
|
TOTAL (A) |
2872.521 |
2860.499 |
2483.842 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Increase/ Decrease
in Stocks |
(31.551) |
(18.699) |
(47.028) |
|
|
|
Raw Materials
Consumed |
743.067 |
777.778 |
755.536 |
|
|
|
Purchase of Trading
Materials |
229.701 |
169.951 |
139.181 |
|
|
|
Operation and
Other Expenses |
1108.128 |
1206.867 |
894.741 |
|
|
|
Payments to and
Provision for Employees |
424.914 |
418.761 |
369.137 |
|
|
|
Prior period
expenses (net) |
0.341 |
1.399 |
1.226 |
|
|
|
TOTAL (B) |
2474.600 |
2556.057 |
2112.793 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
397.921 |
304.442 |
371.049 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
23.944 |
23.699 |
24.028 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
373.977 |
280.743 |
347.021 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
46.024 |
41.497 |
35.980 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE TAX
(E-F) (G) |
327.953 |
239.246 |
311.041 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
115.089 |
87.874 |
109.122 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
212.864 |
151.372 |
201.919 |
|
|
|
|
|
|
|
|
|
|
Short Provision for
Income Tax of earlier years |
2.375 |
0.071 |
0.343 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
714.606 |
649.584 |
534.282 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Dividend for the previous year |
0.000 |
0.002 |
0.000 |
|
|
|
Proposed Dividend |
58.749 |
54.512 |
54.510 |
|
|
|
Corporate Dividend Tax thereon |
9.984 |
9.265 |
9.264 |
|
|
|
Transfer To General Reserve |
22.500 |
22.500 |
22.500 |
|
|
BALANCE CARRIED
TO THE B/S |
833.862 |
714.606 |
649.584 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Exports of Goods
on FOB basis |
1421.419 |
1437.744 |
1139.519 |
|
|
|
Royalty Income |
16.810 |
17.317 |
13.429 |
|
|
|
Others (Freight
& Insurance Receipt) |
46.540 |
34.248 |
29.672 |
|
|
TOTAL EARNINGS |
1484.769 |
1489.309 |
1182.620 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials
(includes accessories) |
319.961 |
331.268 |
279.804 |
|
|
|
Stores & Spares |
0.240 |
1.815 |
1.679 |
|
|
|
Capital Goods |
2.485 |
7.628 |
5.203 |
|
|
|
Traded Goods |
46.642 |
37.737 |
0.000 |
|
|
TOTAL IMPORTS |
369.328 |
378.448 |
286.686 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
|
|
|
|
|
|
- Basic |
25.10 |
18.04 |
24.09 |
|
|
|
- Diluted |
24.72 |
17.14 |
23.83 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2010 |
30.09.2010 |
31.12.2010 |
31.03.2011 |
|
Type |
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
4th
Quarter |
|
Net Sales |
707.500 |
727.800 |
792.800 |
742.100 |
|
Total Expenditure |
635.600 |
643.300 |
714.300 |
725.800 |
|
PBIDT (Excl OI) |
71.900 |
84.500 |
78.500 |
16.300 |
|
Other Income |
7.900 |
7.900 |
6.500 |
7.000 |
|
Operating Profit |
79.800 |
92.400 |
85.000 |
23.300 |
|
Interest |
1.300 |
1.300 |
1.100 |
1.300 |
|
Exceptional Items |
0.000 |
0.000 |
86.000 |
0.000 |
|
PBDT |
78.500 |
91.100 |
169.900 |
22.000 |
|
Depreciation |
12.100 |
13.300 |
12.500 |
14.300 |
|
Profit Before Tax |
66.400 |
77.800 |
157.400 |
7.700 |
|
Tax |
23.500 |
26.200 |
24.700 |
4.800 |
|
Provisions and contingencies |
0.000 |
0.000 |
0.000 |
0.000 |
|
Profit After Tax |
42.900 |
51.600 |
132.700 |
2.900 |
|
Extraordinary Items |
0.000 |
0.000 |
0.000 |
0.000 |
|
Prior Period Expenses |
0.000 |
0.000 |
0.000 |
0.000 |
|
Other Adjustments |
0.000 |
0.000 |
0.000 |
0.000 |
|
Net Profit |
42.900 |
51.600 |
132.700 |
2.900 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
PAT / Total Income |
(%) |
7.41
|
5.29 |
8.13 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
12.30
|
8.97 |
13.63 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
17.21
|
13.65 |
21.22 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.23
|
0.20 |
0.27 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.51
|
0.59 |
0.52 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
3.62
|
2.77 |
2.86 |
LOCAL AGENCY FURTHER INFORMATION
HISTORY
Subject was promoted by Mr. M. Y. Noorani and
others. It was originally incorporated
as a private limited liability company. It
became a deemed public limited liability company in December, 1993 and went
public in January, 1994.
It set up a 100% Export Oriented Unit at Umbergaon,
In the late eighties, the company also started
exploring the sophisticated markets of western Europe. Three companies Zodiac Textiles and Apparels,
Export, Multiplex Packaging and Bangalore Knitwear were amalgamated with the
company. To upgrade production techniques
and to meet the exacting quality standards of West European makers, the
company, re-designed and modernised its entire plant with technical assistance
from a leading European company in 1989.
The company went public with its maiden issue in June, 1994 at a premium
of Rs.100 per share to dilute the promoters’ holdings to 75%.
It has installed a new production facility in
During 2002-03,
It has acquired the whole business of Metropolitan
Trading Company, a manufacturing readymade garment on a going concern
basis. The company entered into a
technical agreement with Zodiac UAE LLC,
DIRECTORS’ BIOGRAPHIES
Mr. M. Y. Noorani
Chairman
Mr. M.Y. Noorani, is the founder of ZODIAC and the founding father of
the Clothing industry in
Dr. S. Abid Hussain
Director
Dr. S. Abid Hussain (Padma Bhushan, 1988) is a retired I.A.S. officer
and the former Secretary, Government of India, Ministry of Commerce and
Ministry of Heavy Industry. He was also a member of the Planning Commission and
the Ambassador of India to the
Mr. M. L. Apte
Director
Mr. M. L. Apte, former Sheriff of Bombay is also the former President of
Maharashtra Chamber of Commerce, Bombay Chamber of Commerce, Cricket Club of
India, Indian Sugar Mills Association, Member of the Indian Cotton Mills
Federation and former Chairman of the Textiles Committee. He is currently the
Chairman of Dr. Writer’s Food Products Private Limited and a Director of Apte
Amalgamations Limited, Grasim Industries Limited, Tata Asset Management
Limited, Bajaj Hindustan Limited, Standard Industries Limited, The Bombay Burmah
Trading Corporation Limited, The Raja Bahadur International Limited and
Kulkarni Power Tools Limited.
Mr. S. M. Datta
Director
Mr. S. M. Datta is the former Chairman of Hindustan Lever Limited. He is
also the former President of
Mr. Bernhard Steinruecke
Director
Mr. Bernhard Steinruecke is the Director General of Indo-German Chamber
of Commerce. He was the Managing Partner on the Board of ABC Bank GmbH,
Dr. Heinrich-Dietrich Dieckmann
Director
Dr. Heinrich-Dietrich Dieckmann is a retired German diplomat whose
entire career was focused mainly on international economic affairs. During his
illustrious career he has served as the German Ambassador to
Mr. Deepak Parekh
Director
Mr. Deepak Parekh (Padma Bhushan, 2006) is a Fellow of the
Mr. Y. P. Trivedi
Director
Mr. Y. P. Trivedi, a member of the Rajya Sabha, is the former President
of Indian Merchants Chamber, The Chamber of Income Tax Consultants,
Indo-African Chamber of Commerce, a member of the Managing Committee of Indian
Merchants’ Chamber. He is currently the Chairman of Trivedi Consultants Private
Limited, Zandu Pharmaceuticals Works Limited and Sai Service Station Limited
and also a Director of Reliance Industries Limited, Birla Power Solution
Limited, Metro Exporters Private Limited, Supreme Industries Limited, Colosseum
Sports and Recreation International, Monica Travels Private Limited, Seksaria
Biswan Sugar Factory Limited, New Consolidated Construction Company Limited,
Birla Cotsyn (India) Limited. Mr. Trivedi has also served as a Director of
Central Bank of India, Dena Bank and Central Bank Executors and Trustee Company
Limited.
Mr. S. R. Iyer
Director
Mr. S.R. Iyer retired as Managing Director of the State Bank of
Mr. A. Y. Noorani
Vice-Chairman and Managing Director
Mr. A.Y. Noorani joined the House of Zodiac in 1968 and after
successfully developing its export business and scaling up its overall
operations, became Managing Director of the organisation in 1980. He completed
the Advance Management Programme at
Mr. S. Y. Noorani
Managing Director and President
Mr. S. Y. Noorani joined the House of ZODIAC in 1982. He was responsible
for setting up the company’s state-of-the-art manufacturing facilities and
international marketing operations in
BUSINESS:
Turnover and Profits – During the financial year ended 31st March 2010,
the income of the company on a standalone basis was virtually flat at
Rs.2872.500 millions vs. Rs.2860.500 millions in the previous year. The profit
before tax increased by 37.12% to Rs.328.000 millions vs. Rs.239.200 millions
in the previous year, while the net profit after tax for the financial year
ended 31st March 2010 increased by 39% to Rs.210.500 millions, vs.
Rs.151.400 millions in the previous year. The net profit of Rs.210.500 millions
is impressive even when compared to 2007-08’s (a great year) profit of
Rs.201.600 millions.
The different business segments, i.e. the design driven international
business from India as well as the branded business and the company’s own
retail, have performed reasonably well, considering the turmoil in the
international markets and the subdued consumer sentiment, both internationally
and in India. What is noteworthy is the company’s focus on profitability has
yielded results, which are visible, both in the PBT and PAT rising sharply.
Although the top line across the business segments was flat, this in
itself was an achievement despite the situation described above, and by the
fact that the company did not discount its products in any of the segments. The
revenue pattern during the year has been sporadic, with periods showing revival
of growth in consumer demand across markets, and other periods where demand
reverted to the pattern seen during the lows between November 2009 and March
2010.
During the year, the company opened 8 new stores and renovated 3 stores
(all stores are company- run, not franchised) in keeping with its strategy of
investing in the growth potential of retail. 4 unviable stores were closed
during the year. Despite the sporadic nature of sales during the year, the
company firmly believes that the return to sustained growth is palpable, and
consequently continues to vigorously pursue its target of profitable growth
(increasing the retail presence being a vital ingredient of this target) with
financial discipline, cost control, global sourcing and conservative hedging of
its forex exposure.
RATING:
During the year, ICRA (an associate of Moody’s Investor Service) has
reaffirmed the Company’s rating of A1 + for its short term fund based/non fund
based facilities, which have been enhanced from Rs.452.500 millions to
Rs.515.000 millions. The company has also been assigned an A1 + rating for its
issue of commercial paper for Rs.200.000 millions.
A1 is the highest credit quality rating assigned by ICRA to short term
debt instruments, which carry the lowest credit risk in the short term. Within
this category, certain instruments are assigned the rating of A1 + to reflect
their relatively stronger credit quality.
CAPEX
Capex was incurred predominantly on the new company run Stores
(Rs.46.700 millions), balancing machinery and equipment (Rs.24.000 millions),
refurbishing of the Corporate Headquarters, as well as energy conservation
(Rs.39.800 millions) and pollution control equipment (Rs.14.800 millions),
besides rental deposits (Rs.92.500 millions).
During the year, the Capex aggregated Rs.125.400 millions (as against
Rs.141.400 millions last year) on a standalone basis and Rs.137.100 millions
(as against Rs.270.800 millions last year) on a consolidated basis.
LIQUIDITY:
The Debt equity ratio as on 31st March 2010, was 0.17 on a
consolidated basis. They maintained sufficient care to meet the strategic
objectives from internal accruals, which have adequately covered the
requirement of funds. The cash and bank balances (consolidated) were Rs.292.200
millions in March 2010 as against Rs.271.100 millions last year.
INCREASE IN SHARE CAPITAL:
During the year, the paid-up share capital of the company has increased
from Rs.83.865 millions to Rs.83.927 millions as a result of allotment of 6150 shares
of Rs.10.00 each under the ESOP Scheme.
BRANDING:
In the prevailing business environment the company’s competitors’ brands
weakened considerably due to their being aggressively discounted. By
comparison, the Zodiac and z3 brands, strengthened considerably vis-ŕ-vis the
competition, to a large extent because none of the three brands, i.e. Zodiac,
ZOD! and z3 were discounted. This, while resulting in a subdued top line,
contributed to the brands’ enhanced strength as well as the strong bottom line.
The product extension of suits and shoes to the Zodiac brand has received most
encouraging response from the consumers.
MANAGEMENT DISCUSSION AND ANALYSIS
OVERVIEW:
In the present scenario, where cotton yarn, and consequently fabric
prices have risen significantly, the competitiveness of
The clothing industry, unlike the spinning and weaving industries, is
not able to pass on the increase in costs to their customers. This is because
of competitive pressures, where
With the competitor countries getting fullest co-operation from their
respective governments, they are able to grab market share from
With the clothing industry being capable of fulfilling the important
objectives of the government, i.e. being the second largest generator of
employment after agriculture, the industry is an important tool for achieving
inclusive growth as well as being able to provide gender sensitive employment.
The vitally important role of this sector needs to be acknowledged and needs
addressing – immediate action could be either reining in cotton markets by
intervention or adequately reimbursing taxes paid on inputs by increasing duty
drawback appropriately.
The volatility of the forex rates (Rs.52 to Rs.45 per USD during April
‘09 to March ‘10) has not made matters any easier. Besides, the industry’s cost
of funds is much higher than that of its competitors.
The TUFS scheme, which seeks to address the needs of the industry
somewhat, has also been found wanting. Reimbursement of subvention under this
scheme from July 2009, i.e. nearly one year, is still outstanding. The
industry’s request that the banks be directed to charge net interest to the
industry under TUFS has also fallen on deaf ears.
The company’s design driven International business has ended flat, with
average unit value realization as well as profitability having improved, which
is creditable in the prevailing situation.
The branded business in
(a) The economy segment - the bottom of the pyramid, has been growing
modestly, almost consistently, since July, and,
(b) The premium segment, in which the growth has been sporadic/erratic
with some months showing handsome gains and other months continuing to show
lack of the feel good factor. The target consumer for this segment has the
money, but due to the lack of the feel good factor, prioritising of expenses on
big ticket items, as well as discounting by brands in this segment that were in
distress, have all resulted in a flat to modest growth for brands that had not
been discounted. The brands that were discounted have shown a slightly higher
increase in their turnover, but have incurred losses again in FY 2009-10.
ZCCL, without discounting, has ended the year with a modest increase in
turnover and a more than pro rata increase in branded margins.
INDUSTRY STRUCTURE AND DEVELOPMENT:
There are reports in the press of the strong likelihood of a
Bilateral/Free Trade Agreement between the EU and
SEGMENT WISE/PRODUCT WISE PERFORMANCE
Segments have been identified in line with the Accounting Standard on
Segment Reporting, taking into account the organization structure, as well as
the differential risk and returns of these segments. The company operates
mainly in the clothing and accessories segment and has no reportable business
segment, which exceeds 10% of the total turnover.
OUTLOOK
Despite the sporadic pattern of sales during the different months of the
year, the Company firmly believes that the return to sustained growth is
palpable and consequently continues to vigorously pursue its target of
profitable growth (increasing the retail presence being a vital ingredient of
this target), with financial discipline, cost control and global sourcing.
The design driven international business, though profitable, can show further
growth as well were the cost disabilities addressed, especially with
COMPANY’S FINANCIAL PERFORMANCE
Turnover and Profits:
During the financial year ended 31st March 2010, the turnover of the
company was flat from Rs.2667.000 millions in the previous year to Rs.2666.500
millions. The net profit before tax stood at Rs.328.000 millions as against
Rs.239.200 millions in the previous year. The net profit after tax for
financial year ended 31st March, 2010, stood at Rs.210.500 millions
as against Rs.151.300 millions in the previous financial year.
The interest cost is 0.45% of revenue which, when compared to most other
companies among the listed entities, is significantly lower.
During the year:
- The company amended its insider trading code in compliance with SEBI
amendment in its (Provision for Insider Trading) Regulations 1992.
- The Board has recommended a dividend (subject to approval of
shareholders) of 70% for the year 2009- 10.
- The company’s paid up capital has been increased to Rs.83.927 millions
on allotment of 6150 shares to eligible Directors and Employees towards the
Company’s ESOP Scheme 2006.
- During the year, ICRA (an associate of Moody’s Investor Service) has
reaffirmed the Company’s rating of A1 + for its short term fund based/non fund
based facilities, which have been enhanced from Rs.452.500 millions to
Rs.515.000 millions. The company has also been assigned an A1 + rating for its
issue of commercial paper for Rs.200.000 millions.
A1 is the highest credit quality rating assigned by ICRA to short term
debt instruments, which carry the lowest credit risk in the short term. Within
this category, certain instruments are assigned the rating of A1 + to reflect
their relatively stronger credit quality.
- Zodiac Clothing Company (UAE) LLC, the step- down subsidiary
incorporated a wholly- owned subsidiary, viz. Zodiac Properties Limited, at
- The company opened 8 new stores during the year, renovated 3 stores
and closed down 4 unviable stores. The number of Company run stores now stands
at 72.
- During the year, the Board constituted a Forex Sub- Committee, chaired
by Mr. S.M. Datta, for guiding the Forex policy and its implementation during
the period of extreme volatility. The Forex Sub- Committee comprises the
following members:
v
Mr. M.Y. Noorani
v
Mr. A.Y. Noorani
v
Mr. S.Y. Noorani
v
Mr. S.M. Datta
Mr. Rajwade of M/s. A. Rajwade and Associates as the Advisor to the
Committee.
- The Government notified its intent to acquire a part of the company’s
land and building of its factory located on National Highway 7,
CONTINGENT
LIABILITIES: (As on 31.03.2010)
a) Guarantee issued
by the Bank and counter guaranteed by the Company: Rs.6.622 millions.
b) Foreign letters
of Credits opened by Bank and counter guaranteed by the Company: Rs.13.074 millions.
c) Foreign
bills/Letters of Credit discounted with Bank: Rs.26.689 millions.
d) Disputed demand
not provided for in respect of:
|
|
31.03.2010 (Rs. In millions) |
|
1) Income Tax
(amount paid under protest Rs.26.079 millions) |
27.484 |
|
2) Sales Tax
(amount paid under protest Rs.6.417 millions) |
10.442 |
|
3) Apparel Export
Promotion Council for non fulfillment of export obligation against duty free
imports |
2.980 |
e) Claims against the
Company not acknowledged as debts: Rs.1.066 millions.
f) Labour disputes
not acknowledged as debts: Amount not ascertainable.
FIXED ASSETS
INTANGIBLE ASSETS
– ACQUIRED
v
Goodwill
v
Software
TANGIBLE ASSETS
v
v
v
Building
v
Leasehold
Improvement
v
Furniture
and Fixtures
v
Machinery
v
Vehicles
v
Computer
v
Office
Equipment
v
Electrical
Installation
Zodiac is one of the largest shirt companies in the world and sells quality shirts to the best stores across the globe. Zodiac has been a quality manufacturer of fashion garments for the last 50 years and is considered to be one of the finest quality shirt makers. All shirts are made from the finest fabrics sourced worldwide so as to give quality, value for money products. Zodiac shirts offer quality at affordable prices ranging from Rs.699 to Rs.2,200.
Zodiac has also been awarded the Most Admired Neckwear Brand Award of the year at the prestigious 'Images Fashion Awards 2000'. Zodiac is today, the largest selling shirts and tie brand at Shopper's Stop according to Brand Equity (The Economic Times).
A 200+ crore, vertically integrated, design and marketing driven clothing brand that employs approximately 3500 people in 16 offices and 7 manufacturing plants located across India, UAE, Germany, USA and U.K. The manufacturing capacity of all the facilities put together is close to 60,00,000 units per annum. Currently, Zodiac sells to approximately 2000 multi-brand retailers and have over 80 exclusive Zodiac showrooms spread across the country.
A Fountainhead of Design Capabilities
Over the years, Zodiac has set up overseas offices and today
Zodiac has offices in
Today, ZOD! follows in the footsteps of the glorious tradition, which has been instituted decades ago by the House of Zodiac. ZOD! The fastest growing club wear brand in the country from the house of Zodiac has surpassed its contemporaries in a very short time. ZOD! today has become the buzzword in fashion as a result of its constant endeavour to deliver contemporary and fashionable collections in the market to the Indian male.
The Zodiac Quality Commitment
The Chairman, Mr. M.Y. Noorani is passionate about QUALITY has etched the word quality into all aspects of the company. Today, all these virtues have made Zodiac competitive globally.
Every input, which goes into making a top quality Zodiac shirt, is unique. From the mother of pearl buttons, to imported lining, to the best of fabrics make up a quality Zodiac shirt.
Zodiac believes in delivering the best and does not make any compromise in terms of quality of fabric, stitching, buttons and lining.
Globally, Zodiac has been present in European,
Middle-eastern and US markets for many years now. Zodiac has exported large
quantities to Europe and has been selling to private labels in
Zodiac shirts are now sold through Bijenkorf in
Until not very long ago, Indian brands had no hope of positioning their products under their own brand name in the sophisticated markets in the West. Although, India has 2.5 % share of world trade in clothing, almost the entire export comprises of what is known in the trade, as "private label" i.e. the brand name on the product is that of the foreign company who sells the goods, whether it is the likes of Polo Ralph Lauren, Hugo Boss, Harrods, Austin Reed or Brooks Brothers, to name a few.
Guinness Book of
A neck tie made of cloth measuring 221.5 feet long was manufactured by
subject and Shoppers' Stop of Bombay, India and was publicly displayed on 15th
December 1994
Government of
Certificate in recognition of their long-standing contribution to
exports in accordance with the provisions of the Exim Policy 1997 - 2002
Government of
Certificate in recognition of their long-standing contribution to
exports in accordance with the provisions of the Exim Policy 1999 - 2002
TESTEX
Regional Institute of Environmental Technology
Certification that subject is an INDUSTRY MEMBER of the Regional
Institute of environmental Technology.
Confederation of
Indian Apparel Exporters
CIAE Lifetime Achievement Award
SGS International
Certification Services
Social Accountability SA 8000: 1997
SGS International
Certification Services
Social Accountability SA 8000: 2000
Zodiac Clothing
Company Limited
CMAI’s Apex Award 2004 – “Management Team of the Year”
ZODIAC Shirts
CMAI’s Apex Award 2004 – “Ad Campaign of the Year”
ZODIAC Ties
Images Fashion Award 2000 – “Most Admired Neckwear Brand of the Year”
ZODIAC Accessories
Texcellence Award 2003 – “Best Brand for Accessories”
ZOD!
- CMAI’s Apex Award 2002 – “Brand Launch of the Year”
- CMAI’s Apex Award 2002 – “Emerging Brand of the Year”
- CMAI’s Apex Award 2004 – “Promising Brand of the Year”
- CMAI’s Apex Award 2005 – “Advertising Campaign of the Year"
The manufacturing facilities of Zodiac are typically stretched out over
an expanse of nearly 35,000 sq. feet each, and are constant in design/layout.
The cutting rooms have specially designed cutting tables to accommodate cloth
lays of over 60 yards, and which are spread using automated, state of the art
equipment. Fusing is done on high-end Kannegiesser machines in air-conditioned
rooms to maintain correct fusing conditions. All shirts are fully matched and
balanced as a standard.
After cutting, the garments are sent to the sewing section. The sewing section
of each plant typically consist of five to seven stage assembly lines, with
specialised machines for critical operations.
The finishing rooms are equipped with modern steam irons, boilers,
heated folding tables and vacuum tables, which result in a well-presented
garment.
The Plants also have mordern embroidery, washing and placement-printing
facilities.
All manufacturing facilities have their own captive power generating
units, so that they are not affected in times of power failures and therefore
are able to adhere to customer delivery schedules.
All factories are compliant with social issues and have been audited and
certified by several independent organisations as being socially responsible. Zodiac
is one of the first SA 8000 certified menswear companies in the world.
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No records 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.44.37 |
|
|
1 |
Rs.72.34 |
|
Euro |
1 |
Rs.63.87 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--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 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 |
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 |
|
- |
NB |
New Business |
- |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.