MIRA
INFORM REPORT
|
Report Date : |
21.11.2012 |
IDENTIFICATION DETAILS
|
Name : |
ITC LIMITED (w.e.f.1974) |
|
|
|
|
Formerly Known
As : |
Imperial Tobacco
Company of India Limited |
|
|
|
|
Registered
Office : |
Virginia House,
37, |
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|
|
Country : |
|
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|
|
|
Financials (as
on) : |
31.03.2012 |
|
|
|
|
Date of
Incorporation : |
24.08.1910 |
|
|
|
|
Com. Reg. No.: |
21-001985 |
|
|
|
|
Capital Investment
/ Paid-up Capital : |
Rs.7818.424
Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
L16005WB1910PLC001985 |
|
|
|
|
Legal Form : |
A Public Limited Liability Company. The Company’s Shares are Listed on
the Stock Exchange. |
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|
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|
Line of Business
: |
Manufacturer of
Cigarettes and Tobacco. It is also engaged in Hotel Business. |
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|
|
|
No. of Employees
: |
5000
(Approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
Aa (81) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
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 |
|
Maximum Credit Limit : |
USD 750000000 |
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|
|
|
Status : |
Excellent |
|
|
|
|
Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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|
|
Comments : |
ITC is a
Diversified Group. It is a well established and a reputed company having good
track. Financial position of the company appears to be sound. Directors are
reported to be experienced and respectable businessmen. Trade relations are
reported as fair. Business is active. Payments are reported to be regular and
as per commitments. Company can be
considered good for normal business dealings at usual trade terms and
conditions. It can be
regarded as a promising business partner in medium to long run. |
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 – June 30, 2012
|
Country Name |
Previous Rating (31.03.2012) |
Current Rating (30.06.2012) |
|
|
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
INDIAN ECONOMIC OVERVIEW
|
Source
: CIA |
EXTERNAL AGENCY RATING
|
Rating Agency Name |
CRISIL |
|
Rating |
AAA (Long Term Rating) |
|
Rating Explanation |
Highest degree of safety and lowest credit risk |
|
Date |
14.02.2012 |
|
Rating Agency Name |
CRISIL |
|
Rating |
A1+ |
|
Rating Explanation |
Very strong degree of safety and lowest credit risk |
|
Date |
14.02.2012 |
RBI DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available RBI Defaulters’ list.
EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of
31-03-2012.
LOCATIONS
|
Registered Office : |
Virginia House, 37,
Jawaharlal Nehru Road, Kolkata – 700071, West Bengal, India |
|
Tel. No.: |
91-33-22886426/
22880034/ 22889371 |
|
Fax No.: |
91-33-22882358 |
|
E-Mail : |
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|
Website : |
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|
|
|
Hotel : |
Oberio Flight Services, |
|
|
|
|
Headquarters : |
84 (Old No.90) Chamiers Road, Chennai - 600018, Tamilnadu, India |
|
Tel. No.: |
91-44-42081508 |
|
Fax No.: |
91-44-24340294 |
|
|
|
|
Factory 1: |
Integrated Industrial Estate, Sidcuil, Plot No. 1, Sector 11, Hardwar
– 249403, Uttarkhand, India |
|
Tel. No.: |
91-1334-322483 |
|
Fax No.: |
91-1334-235383 |
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|
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Factory 2: |
P O Box 2277, Thiruvottur, Chennai – 600019, Tamilnadu, India |
|
Tel. No.: |
91-44-25733121 |
|
Fax No.: |
91-44-25733852 |
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|
|
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Factory 3: |
Plot No. B 27, MIDC Ranjangaon, Pune - 412222, Maharashtra, India |
|
|
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|
Head Office : |
ITC Hotel
Kakatiya Sheraton and Totheyrs, 63-3-1187, Begumpet, Hyderabad -500016, Andhra
Pradesh, India |
|
Tel. No.: |
91-40-23400132 |
|
Fax No.: |
91-40-23401045 |
|
|
|
|
Corporate Office : |
Kakatiya Sheraton
and Totheyrs, Begumpet, |
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|
Branch Office : |
International Sales No. 106, |
|
Tel. No.: |
91-40-27843768 |
|
Fax No.: |
91-40-27810034 |
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|
|
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Plants : |
Cigarette Factories v
Kolkata v
93/1, Karl Marx Sarani, P. B.
No. 17203, Kolkata - 700 043, West Munger v
Basdeopur P. O., District
Munger - 811 202, v
Sardar Patel Marg, P. O. Box
No. 25, Ranjangaon v 4. Plot No.
B-27, MIDC Ranjangaon, Taluka Shirur District Pune 412 220, Green Leaf
Threshing Plants Anaparti v
East Godavari District,
Anaparti - 533 342, Chirala v
Prakasam,
P. B. No. 1, Chirala - 523 157, Nanjangud 3. Immavu & Packaging and
Printing Plants Chennai v
Post Box No. 2277, Tiruvottiyur, Chennai - 600 019, Tel No.: 91-44-25733121/25733171/25733181 Fax No.: 91-44-25733852 Haridwar v
Plot No. 1, Sector 11,
Integrated Industrial Estate, Haridwar – 249403, Munger v
Basdeopur P. O., District
Munger, Munger - 811 202, Tel No.: 91-6344-220505/16/17 / 2201892/222126/142/146 Fax No.: 91-6344-222443/222839 Paper and
Paperboard Mills Bollaram v
Anrich Industrial Estate,
Village Bollarum, Medak District, Andhra Pradesh – 502 325 Sarapaka v
Sarapaka, Khammam District -
507 128, Thekkampatty v
Tribeni v
P O Chandrahati, District
Hooghly – 712 504, West Cast Coating Plant Anrich Industrial
Estate, Village Bollarum, Medak District - 502 325, Lifestyle Retailing Design and Technology Centre v
86, Industrial Estate, Phase
I, Udhyog Nagar, Gurgaon - 122 016, FOODS FACTORIES Haridwar 1. Plot No. 1,
Sector 11 Integrated Industrial Estate Haridwar - 249 403 Uttarakhand, Inda Ranjangaon 2. Plot No. D-1,
MIDC Ranjangaon Taluka Shirur District Pune – 412 220, PERSONAL CARE PRODUCTS FACTORIES Haridwar 1. Plot No. 1,
Sector 11, Integrated Industrial Estate, Haridwar -249 403, Manpura 2. Village
Manpura, Tehsil Baddi, District Solan - 174 101, HOTELS Owned Hotels 1. ITC Mughal*
Taj Ganj Agra - 282 001, Bengaluru 2. ITC Gardenia*
1, Residency Road, Bengaluru-560 025, 3. ITC Chennai 4. My Fortune,
Chennai, Jaipur 5. ITC
Rajputana* Kolkata 6. ITC Sonar*,
1, Mumbai 7. ITC Maratha*,
Sahar, Mumbai - 400 099, 8. ITC Grand
Central*, 287, 9. ITC Maurya*,
Sardar Patel Marg, Diplomatic Enclave, 10. Sheraton New
Delhi Hotel, District Centre, Saket, Licenced Hotels 11.
WelcomHeritage, Umed Port Blair 12. Vadodara 13. WelcomHotel
Vadodara, Hotels Under
Operating Services 14. WelcomHotel
Rama International, R-3, Chikalthana, Chennai 15. Sheraton
Park Hotel & Towers, 132, 16. ITC
Kakatiya*, 6-3-1187, Begumpet, 17. CHOUPAL SAAGARS
- RURAL SERVICES CENTRES LOCATED AT v
Amravati v
Badaun v
Bahraich v
Chandouli v
Chindwara v
Dewas v
Dhar v
Gonda v
Hardoi v
Hathras v
Itarsi v
Jagdishpur v
Mandsaur v
Mhow v
Nagda v
Parbhani v
Pilibhit v
Ratlam v
Sehore v
v
Vidisha v
Wardha v
Washim LIFESTYLE RETAILING Design and Technology Centre v
Gurgaon Wills Lifestyle Stores LOCATED AT v
v
Ahmedabad v
v
v Bengaluru v
v
Bhubaneshwar v
v
v
Dehradun v
Ernakulam v
v
Gurgaon v
Gurgaon v
v
v
Jalandhar v
Jaipur v
v
v
Kolkata v
v
v
Mumbai / Thane v
v
Nashik v
v
Noida v
Panjim v
v
Pune v
v
v
Siliguri v
v
Vadodara v
v John Players Stores* v
Bengaluru v
Chennai v
v
Kolkata v
Mumbai / Thane |
|
|
|
|
Division
Headquarters : |
Chief Executive Mr. S. Sivakumar Head of Finance Mr. C V Sarma Vice President - HRD Chief Information Officer Chief Manager - Processed Fruits Vice President - Operations Trader - Edible Nuts and Spices Chief Trader - Coffee and Spices Chief Manager - Aqua Mr. S. Biswas |
DIRECTORS
AS ON 29.07.2011
|
Name : |
Mr. Yogesh
Chander Deveshwar |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Mr. Nakul Anand |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. Pradeep Vasant Dhobale |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. Kurush Noshir Grant |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. Anil Baijal |
|
Designation : |
Non Executive Director |
|
|
|
|
Name : |
Mr. Shilabhadra Banerjee |
|
Designation : |
Non Executive Director |
|
|
|
|
Name : |
Mr. |
|
Designation : |
Non Executive Director |
|
|
|
|
Name : |
Mr. Serajul Haq Khan |
|
Designation : |
Non Executive Director |
|
|
|
|
Name : |
Mr. Dinesh Kumar Mehrotra |
|
Designation : |
Non-Executive Directors |
|
|
|
|
Name : |
Mr. Sunil Behari Mathur |
|
Designation : |
Non-Executive Directors |
|
|
|
|
Name : |
Mr. Hugo Geoffrey Powell |
|
Designation : |
Non Executive Director |
|
|
|
|
Name : |
Mr. Pillappakkam
Bahukutumbi Ramanujam |
|
Designation : |
Non-Executive Director |
|
|
|
|
Name : |
Mr. Basudeb Sen |
|
Designation : |
Non-Executive Director |
|
|
|
|
Name : |
Mr. Balakrishnan
Vijayaraghavan |
|
Designation : |
Non-Executive Director |
|
|
|
|
Name : |
Mr. Anthony Ruys |
|
Designation : |
Non-Executive Director |
|
|
|
|
Name : |
Mr. Krishnamoorthy Vaidyanath |
|
Designation : |
Non-Executive Director |
KEY EXECUTIVES
|
Name : |
Mr. Biswa Behari
Chatterjee |
|
Designation : |
Executive Vice President
and Company Secretary |
|
|
|
|
Name : |
Mr. Rajiv Tandon |
|
Designation : |
Chief Financial Officer |
|
|
|
|
Audit Committee : |
|
|
|
|
|
Compensation
Committee : |
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|
|
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Nominations
Committee : |
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|
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|
Investor Services Committee
: |
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|
|
|
|
Sustainability
Committee : |
|
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
AS ON 30.09.2012
|
Category of Shareholders |
No. of Shares |
Percentage of
Holding |
|
|
|
|
|
(A) Shareholding of Promoter and Promoter Group |
|
|
|
|
-- |
-- |
|
|
-- |
-- |
|
|
|
|
|
(B) Public Shareholding |
|
|
|
|
|
|
|
|
1100420589 |
14.05 |
|
|
3221058 |
0.04 |
|
|
1549998053 |
19.79 |
|
|
1439396064 |
18.38 |
|
|
13088 |
0.00 |
|
|
4093048852 |
52.26 |
|
|
|
|
|
|
|
|
|
|
437858057 |
5.59 |
|
|
|
|
|
|
|
|
|
|
696139426 |
8.89 |
|
|
134284287 |
1.71 |
|
|
|
|
|
|
2471253136 |
31.55 |
|
|
2413224203 |
30.81 |
|
|
468881 |
0.01 |
|
|
4125941 |
0.05 |
|
|
11886638 |
0.15 |
|
|
41547473 |
0.53 |
|
|
3739534906 |
47.74 |
|
|
|
|
|
Total Public shareholding (B) |
7832583758 |
100.00 |
|
|
|
|
|
Total (A)+(B) |
7832583758 |
100.00 |
|
|
|
|
|
(C) Shares held by Custodians and against which Depository Receipts have
been issued |
|
|
|
|
-- |
0.00 |
|
|
23710602 |
0.00 |
|
|
23710602 |
0.00 |
|
|
|
|
|
Total (A)+(B)+(C) |
7856294360 |
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer of
Cigarettes and Tobacco. It is also engaged in Hotel Business. |
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|
|
||||||||
|
Products : |
|
PRODUCTION STATUS (AS ON 31.03.2011)
|
Class of Goods |
Unit |
Licensed
Capacity |
Installed
Capacity |
Actual
Production |
|
|
|
|
|
|
|
Cigarettes |
Million |
123547 |
141754 |
69171 |
|
Smoking Tobaccos |
Tonne |
NA |
NA |
26 |
|
Printing and
Packaging including Flexible |
Tonne |
NA |
107852 |
72814 |
|
Un manufactured
Tobacco |
Tonne |
NA |
NA |
104624 |
|
Pulp |
Tonne |
NA |
235000 |
255511 |
|
Paperboards and
Paper |
Tonne |
NA |
452500 |
558884 |
|
Packaged Food
Products |
Tonne |
NA |
107724 |
46101 |
|
Personal Care
Products |
Tonne |
NA |
235962 |
36704 |
NOTE
a) The “Registered/Licensed Capacity” (including as approved by “Letters of Intent”) is exclusive of additional capacities permissible under the policy of the Government of India.
b) Includes production meant for internal consumption.
c) Based on Capacity rated by equipment manufacturers / project consultants at the time of installation.
N.A. – Not Applicable
GENERAL INFORMATION
|
No. of Employees : |
5000
(approximately) |
||||||||||||||||||||||||||||||
|
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|
||||||||||||||||||||||||||||||
|
Bankers : |
·
State Bank of 38, · Standard Chartered Grindlays Bank Limited, 41, ·
United Bank of 10 Netaji Subhas Road, Kolkata - 700001, West ·
Citibank , Kolkata, West |
||||||||||||||||||||||||||||||
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|
|
||||||||||||||||||||||||||||||
|
Facilities : |
|
||||||||||||||||||||||||||||||
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
Deloitte Haskins and Sells Chartered Accountants |
|
Address : |
|
|
|
|
|
Joint Ventures : |
· Maharaja Heritage Resorts Limited ·
Espirit Hotels Private Limited · Sitel Operating Corporation India Limited (till 31.05.2009) |
|
|
|
|
Associates : |
· Gujarat Hotels Limited · Russell Investments Limited · ATC Limited · Classic Infrastructure and Development Limited · International Travel House Limited · Divya Management Limited · Antrang Finance Limited-being associates of the Company, and ·
Tobacco Manufacturers ( |
|
|
|
|
Subsidiaries : |
·
Srinivasa Resorts
Limited ·
Fortune Park Hotels
Limited ·
Bay Islands Hotels
Limited ·
Russell Credit Limited ·
ITC Infotech India
Limited ·
Wills Corporation Limited ·
Gold Flake Corporation
Limited ·
Landbase India Limited ·
BFIL Finance Limited ·
Surya Nepal Private
Limited ·
King Maker Marketing,
Inc. ·
ITC Global Holdings
Pte. Limited, ·
BFIL Securities Limited
(a subsidiary of BFIL Finance Limited) |
|
|
|
|
Other Entities
under control of the company : |
·
·
ITC Education Trust ·
ITC Rural Development
Trust |
CAPITAL STRUCTURE
AS ON 27.07.2012
Authorised Capital: Rs.10000.000 Millions
Issued, Subscribed & Paid-up Capital: Rs.7863.109
Millions
AS ON 31.03.2012
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
10000000000 |
Equity Shares |
Rs.1/- each |
Rs.10000.000 Millions |
|
|
|
|
|
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
7818424300 |
Equity Shares |
Rs.1/- each |
Rs.7818.424
Millions |
|
|
|
|
|
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
7818.400 |
7738.100 |
3818.200 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
180100.500 |
151794.600 |
136825.600 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
187918.900 |
159532.700 |
140643.800 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
17.700 |
19.400 |
0.000 |
|
|
2] Unsecured Loans |
773.200 |
865.800 |
1077.100 |
|
|
TOTAL BORROWING |
790.900 |
885.200 |
1077.100 |
|
|
DEFERRED TAX LIABILITIES |
8727.200 |
8018.500 |
7850.100 |
|
|
|
|
|
|
|
|
TOTAL |
197437.000 |
168436.400 |
149571.000 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
91066.800 |
83559.100 |
81424.000 |
|
|
Capital work-in-progress |
22692.600 |
13226.000 |
10089.900 |
|
|
|
|
|
|
|
|
INVESTMENT |
63165.900 |
55546.200 |
57268.700 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
56378.300
|
52691.700
|
45490.700
|
|
|
Sundry Debtors |
9860.200
|
8851.000
|
8588.000
|
|
|
Cash & Bank Balances |
28189.300
|
22432.400
|
11262.800
|
|
|
Other Current Assets |
1368.900
|
932.600
|
2884.400
|
|
|
Loans & Advances |
16942.000
|
17099.200
|
13060.600
|
|
Total
Current Assets |
112738.700
|
102006.900
|
81270.800
|
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
14248.400
|
13953.100
|
34449.100
|
|
|
Other Current Liabilities |
33867.900
|
30885.900
|
542.300
|
|
|
Provisions |
44110.700
|
41062.800
|
45499.400
|
|
Total
Current Liabilities |
92227.000
|
85901.800
|
80490.800
|
|
|
Net Current Assets |
20511.700
|
16105.100
|
788.400
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
197437.000 |
168436.400 |
149571.000 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
251738.200 |
214589.800 |
181531.900 |
|
|
|
Other Income |
8253.400 |
5798.200 |
6147.400 |
|
|
|
TOTAL (A) |
259991.600 |
220388.000 |
187679.300 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of material consumed |
76609.100 |
69715.600 |
|
|
|
|
Purchases of Stock-in-Trade |
20372.100 |
14597.200 |
|
|
|
|
Changes in inventories of finished goods, work-in-progress, Stock-in-Trade and Intermediates |
(655.900) |
(2705.500) |
121439.100 |
|
|
|
Employee benefits expense |
12654.100 |
11400.200 |
|
|
|
|
Other expenses |
54272.600 |
47455.200 |
|
|
|
|
TOTAL (B) |
163252.000 |
140462.700 |
121439.100 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
96739.600 |
79925.300 |
66240.200 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
779.200 |
683.800 |
0.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION(C-D) (E) |
95960.400 |
79241.500 |
66240.200 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
6985.100 |
6559.900 |
6087.100 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
88975.300 |
72681.600 |
60153.100 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
27351.600 |
22805.500 |
19543.100 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
61623.700 |
49876.100 |
40610.000 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
NA |
NA |
8581.400 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
General Reserve |
NA |
NA |
4061.000 |
|
|
|
Proposed Dividend |
NA |
NA |
0.000 |
|
|
|
- Ordinary Dividend |
NA |
NA |
17181.800 |
|
|
|
-Special Centenary Dividend |
NA |
NA |
21000.000 |
|
|
|
Income Tax on Proposed Dividend |
NA |
NA |
0.000 |
|
|
|
- Current year |
NA |
NA |
6341.500 |
|
|
|
- Earlier year’s provision no longer
required |
NA |
NA |
(6.000) |
|
|
BALANCE CARRIED TO
THE B/S |
NA |
NA |
613.100 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Export Earnings |
20999.900 |
22951.800 |
19297.20000 |
|
|
|
Dividends |
4867.200 |
0.000 |
0.000 |
|
|
|
Hotel Earnings |
277.500 |
4762.700 |
3985.100 |
|
|
|
Fright and Insurance Recoveries |
62.100 |
326.000 |
212.100 |
|
|
|
Other Earnings |
26206.700 |
102.200 |
48.300 |
|
|
TOTAL EARNINGS |
52413.400 |
28142.700 |
23542.700 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
9251.600 |
8449.000 |
6039.400 |
|
|
|
Components & Spare Parts |
877.100 |
771.200 |
682.500 |
|
|
|
Capital Goods |
7058.800 |
2259.400 |
2675.000 |
|
|
|
Others |
270.300 |
169.600 |
111.200 |
|
|
TOTAL IMPORTS |
17457.800 |
11649.200 |
9508.100 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
|
|
|
|
|
|
- Basic |
7.93 |
6.49 |
5.34 |
|
|
|
- Diluted |
7.84 |
6.41 |
5.28 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
30.06.2012 1st
Quarter |
30.09.2012 2nd
Quarter |
|
|
|
|
|
|
Net sales |
|
67130.700 |
72265.800 |
|
Total Expenditure |
|
43447.300 |
45383.100 |
|
PBIDT (Excl OI) |
|
23683.400 |
26882.700 |
|
Other Income |
|
1767.600 |
1849.800 |
|
Operating Profit |
|
25451.000 |
28732.500 |
|
Interest |
|
137.600 |
232.900 |
|
Exceptional terms |
|
0.000 |
0.000 |
|
PBDT |
|
25313.400 |
28499.600 |
|
Depreciation |
|
1947.900 |
1888.600 |
|
PROFIT BEFORE TAX |
|
23365.500 |
26611.000 |
|
Tax |
|
7344.100 |
8246.800 |
|
Provision and contingencies |
|
0.000 |
0.000 |
|
Profit After Tax |
|
16021.400 |
18364.200 |
|
Extra ordinary items |
|
0.000 |
0.000 |
|
Prior Period Expense |
|
0.000 |
0.000 |
|
Net Adjustments |
|
0.000 |
0.000 |
|
Net Profit |
|
16021.400 |
18364.200 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
PAT / Total Income |
(%) |
23.70
|
22.63 |
21.64 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
35.34
|
33.87 |
33.14 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
43.66
|
39.87 |
36.97 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.47
|
0.45 |
0.43 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.49
|
0.54 |
0.58 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.22
|
1.19 |
1.01 |
LOCAL AGENCY FURTHER INFORMATION
|
Sr. No. |
Check List by Info Agents |
Available in Report (Yes
/ No) |
|
1] |
Year of Establishment |
Yes |
|
2] |
Locality of the firm |
Yes |
|
3] |
Constitutions of the firm |
Yes |
|
4] |
Premises details |
No |
|
5] |
Type of Business |
Yes |
|
6] |
Line of Business |
Yes |
|
7] |
Promoter's background |
No |
|
8] |
No. of employees |
Yes |
|
9] |
Name of person contacted |
No |
|
10] |
Designation of contact person |
No |
|
11] |
Turnover of firm for last three years |
Yes |
|
12] |
Profitability for last three years |
Yes |
|
13] |
Reasons for variation <> 20% |
----- |
|
14] |
Estimation for coming financial year |
No |
|
15] |
Capital in the business |
Yes |
|
16] |
Details of sister concerns |
Yes |
|
17] |
Major suppliers |
No |
|
18] |
Major customers |
No |
|
19] |
Payments terms |
No |
|
20] |
Export / Import details (if applicable) |
No |
|
21] |
Market information |
----- |
|
22] |
Litigations that the firm / promoter
involved in |
----- |
|
23] |
Banking Details |
Yes |
|
24] |
Banking facility details |
Yes |
|
25] |
Conduct of the banking account |
----- |
|
26] |
Buyer visit details |
----- |
|
27] |
Financials, if provided |
Yes |
|
28] |
Incorporation details, if applicable |
Yes |
|
29] |
Last accounts filed at ROC |
Yes |
|
30] |
Major Shareholders, if available |
No |
|
31] |
Date of Birth of
Proprietor/Partner/Director, if available |
Yes |
|
32] |
PAN of Proprietor/Partner/Director, if
available |
No |
|
33] |
Voter ID No of Proprietor/Partner/Director,
if available |
No |
|
34] |
External Agency Rating, if available |
Yes |
MANAGEMENT
DISCUSSION AND ANALYSIS
SOCIO-ECONOMIC ENVIRONMENT
After staging a
smart recovery in 2010, growth in global economic output slowed down considerably
in 2011. Against a growth rate of 5.3% recorded in 2010 and a forecast of 4.4%
at the beginning of the year, global output is estimated to have grown by only
3.9% in 2011, according to the International Monetary Fund’s April 2012 report.
Growth in Advanced Economies slowed down to 1.6% in 2011 against 3.2% in 2010
primarily due to the sovereign debt crisis in the euro zone, contraction of the
Japanese economy and a sluggish recovery in the
The world economy
is passing through a very difficult phase and is expected to grow by 3.5% in
2012. Despite a better than expected recovery shaping in the US, the key
reasons for the subdued growth forecast of 1.4% in the Advanced Economies
remain the sovereign debt crisis in the euro zone, focus on fiscal
consolidation and continued bank deleveraging. Growth in the developing world is
forecast to slow down further to 5.7% with the key economies of China, India,
Brazil and Russia – all expected to record lower rates of growth.
As stated above,
the Indian economy decelerated considerably during the year, growing below 7% in
2011/12 as compared to 8.4% in 2010/11. The
cumulative impact of a tight monetary policy stance adopted by the Reserve Bank
in a bid to balance the growth-inflation dynamic, lower global demand and
hardening international prices of crude oil combined to lower the growth rate
to below 6% during the second half of the year. There was a marked slowdown in
the mining and quarrying, manufacturing and construction sectors. The poor
performance of the Industrial sector which grew below 4% - a 10 year low - reflected
a number of factors including a higher interest rate regime, slackening
external demand and a general decline in business confidence. Of particular
concern is the sharp fall in the Gross Fixed Capital Formation which dropped
below 30% of GDP during the year, representing a decline of nearly 4 percentage
points over the last 4 years. The position on the ‘twin deficits’ also worsened
with the fiscal deficit touching 5.9% of GDP and the current account deficit
estimated at around 4% of GDP. With a burgeoning current account deficit on the
one hand and only a small increase in net capital inflows on the other, the
overall Balance of Payments situation turned negative - the first time in 16
years excluding 2008/09! This, amongst other factors, led to a sharp
depreciation of the Indian Rupee which fell to record lows. There was some good
news on the inflation front which, after staying close to 10% for an extended
period of 22 months, moderated to around 7% in recent months.
As
per the RBI’s Monetary Policy Statement 2012/13 released in April 2012, the
Indian economy is projected to grow by 7.3% in 2012/13 assuming normal
monsoons. Significant downside risks to this baseline forecast include the
outlook for global commodity prices - especially of crude oil, slippages on the
fiscal front which could stoke inflation and lead to a crowding out of private
investment and the unsustainable current account deficit levels. The inflation
scenario remains challenging with oil prices ruling high, incomplete
pass-through of past price increases, suppressed inflation in respect of coal
and electricity and persisting structural issues especially on the supply side.
This leaves little flexibility in the near term on the interest rates front
after RBI’s 50 basis points repo rate cut in April 2012.
While
a growth rate of around 7% per annum would sustain
With
The
Company’s exemplary initiatives in the area of sustainable development have won
global recognition and have combined to make it the only enterprise in the
world of comparable dimensions to have achieved and sustained the three key
global indices of environmental sustainability of being ‘water positive’ (for
10 years), ‘carbon positive’ (for 7 years), and ‘solid waste recycling
positive’ (for 5 years).
FINANCIAL
PERFORMANCE
The Company posted
yet another year of impressive results with strong topline growth and high
quality earnings, reflecting the robustness of its corporate strategy of
creating multiple drivers of growth. This performance is particularly
remarkable when viewed against the backdrop of the extremely challenging
business context in which it was achieved, namely, a slowdown in the economy,
high levels of inflation and the continuing cascading impact of arbitrary
increases in VAT on cigarettes.
Gross Revenue for
the year grew by 14.2% to Rs.348718.600 Millions. Net Revenue at Rs.247984.300
Millions grew by 17.2% primarily driven by a 23.6% growth in the non-cigarette
FMCG businesses, 20.0% growth in Agri business and 16.6% growth in the
Cigarettes segment. Profit before tax increased by 22.4% to Rs.88975.300
Millions while Net Profits at Rs.61623.700 Millions registered a growth of
23.6%. Earnings Per Share for the year stands at 7.93 (previous year 6.49).
Cash flows from Operations aggregated Rs. 83340.000 Millions compared to
Rs.75280.000 Millions in the previous year. Continuing with the Company’s
chosen strategy of creating multiple drivers of growth, the Company is today,
the leading FMCG marketer in
The
Directors are pleased to recommend a Dividend of 4.50 per share (previous year
- 4.45 per share including a Special Dividend ` 1.65 per share) for the year
ended 31st March, 2012. Total cash outflow in this regard will be Rs.
40890.4000 Millions (previous year Rs.40020.900
Millions) including Dividend Distribution Tax of Rs. 5707.500 Millions
(previous year Rs.5586.200 Millions)
representing an increase in the payout over last year that included Rs.148.400 Millions as Special Dividend, including Dividend Distribution
Tax, declared to commemorate the Company’s 100th AGM.
The
Board further recommends a transfer to General Reserve of Rs.6500.000 Millions (previous year Rs.4987.600 Millions). Consequently, the Board recommends leaving a surplus
in Statement of Profit and Loss of Rs.19725.900 Millions (previous year Rs.5486.700 Millions).
BUSINESS SEGMENTS
A. FAST MOVING
CONSUMER GOODS
FMCG – Cigarettes
The cigarette
industry in
The
steep hike in Excise Duty rates announced in the Union Budget 2012 will further
exacerbate the problem of discriminatory and high taxation on cigarettes within
the tobacco industry.
The
year also witnessed arbitrary and steep hikes in VAT rates on cigarettes by
many States. This is a complete departure from the principles of uniform VAT
rates enunciated by the Empowered Committee in its White Paper on State level
Value Added Tax. Further, several States continued to levy discriminatory and
higher rates of VAT on cigarettes compared to other tobacco products, thereby
widening the tax gap amongst tobacco products. A plethora of 29 different tax
rates are currently applicable on cigarettes across States in
stocks
by unscrupulous elements thus depriving the Government of revenue and diverting
trade away from legitimate distribution channels.
The
findings reported in the Global Adult Tobacco Survey (GATS)
This
pattern of tobacco consumption is contrary to global trends, including that of
their neighboring countries, where cigarettes are the dominant form of tobacco
consumption. The domestic legal cigarette industry is faced with the growing
menace of illegal cigarettes. Independent research indicates that, in
Attractive
tax arbitrage opportunities, as a result of high level of taxes on the legal
domestic cigarette industry in
Another
dangerous outcome of the increasing volume of illicit trade is that it
encourages the entry of organized
criminal
syndicates, which can have serious law and order consequences for the country.
Internationally, it has been reported that illegal profits from cigarette
smuggling have been used to fund terrorist activities.
Coupled
with their porous borders, cigarette imports under Open General License (OGL)
make it extremely difficult to monitor and regulate the inflow of illegal
stocks. Further, with the domestic cigarette industry being strictly regulated,
including compulsory licensing under the Industrial (Development and
Regulation) Act, 1951, a liberal import policy is contrary to the Government’s
tobaccocontrol policies. This is also detrimental to the interests of Indian
tobacco farmers, as it directly impacts the demand for indigenous tobacco by
the domestic industry. The demographic construct of
The
industry had recommended that the Excise Duty rate at the entry level segment
be reduced to ` 200 per thousand cigarettes to enable the domestic legal
industry to effectively counter illegal cigarettes with competitively priced
products. Whilst, the length prescribed for the filter cigarette segment at the
lowest end has been revised from ‘length ≤ 60mm’ to ‘length ≤
65mm’, the Excise Duty on the segment has been retained at ` 689 per thousand
cigarettes. Coupled with alarmingly high State VAT and local taxes, the
legitimate, duty paid, industry will still be unable to match the prices of
product offers of the illegal industry, at the current Excise Duty level.
The
implementation of Goods and Services Tax (GST) with a unitary standard rate of
tax across the Indian common market will be an important milestone in the near
future. As stated earlier, cigarettes, by virtue of being very highly taxed,
offers a lucrative tax arbitrage opportunity and is vulnerable to large scale
smuggling. Consequently, it is imperative that GST on cigarettes is levied in
an appropriate manner i.e. at the uniform standard rate applicable to the
general category of goods across the country, with availability of input tax
credit. Central Excise Duty should continue to be levied only at specific
rates. It is critical to note that any increase in the overall tax rate on
cigarettes, will widen the arbitrage opportunity between legitimate cigarettes
and illegal, tax evaded cigarettes. It is, therefore, critical that the
combined incidence of Excise Duty and GST on cigarettes remains revenue neutral
(i.e., kept at current levels).
The
Company, along with other stakeholders and industry bodies continues to
represent to the regulatory authorities seeking a non-discriminatory tax and
regulatory policy on tobacco products in the interest of the Government
exchequer, domestic farmer community and industry.
Despite
a difficult operating environment in the market place, it is gratifying to
report that the Company further improved its market standing during the year.
The Company’s uncompromising commitment to continuous and consistent offerings
of value-added, world class products has been reinforced through innovations in
product development and launch of differentiated offers. The portfolio continues
to be strengthened through strategic investments in product quality and
technology.
A
premium line of hand-rolled cigars launched by the Company in 2010 under the
brand name ‘Armenteros’ has gained significant consumer franchise, competing
against world renowned Cuban and other cigar brands. The Armenteros range of
cigars is now available in premium outlets across key cigar markets and is
expected to further consolidate and grow its franchise.
During
the year, a state-of-the-art, flexible, Primary Plant designed to cater to
future product development requirements was successfully commissioned at
Ranjangaon, Pune. The uncompromising focus on quality, investments in
best-in-class technology and embedding of best practices has ensured the
continued delivery of products of international quality. Structured problem
solving methodologies like Six Sigma and several initiatives that foster
innovation have been deployed to ensure sustained improvements in quality and
productivityof all resources.
In line
with the Company’s commitment to building sustainable environmental capital,
the business continues to invest in renewable sources of energy. A 6.3
megawatts (MW) wind energy facility has been commissioned in
The
Company’s Cigarettes business faces the daunting challenges of an unprecedented
high incidence of taxation, complex tax structure, rising illegal trade and a
discriminatory regulatory climate. Despite these challenges, the relentless
pursuit of excellence in building robust, world class brands, innovation in
processes and
investment
in world class technologies will enable the Company to further consolidate its
market standing. The Company believes that both the objectives of maximisation
of the economic potential of tobacco and the tobacco control can be achieved
through rationalisation of taxes on cigarettes, minimisation of discriminatory
taxes between different classes of tobacco products and a regulatory framework
that addresses the genuine concerns of all the stakeholders of the tobacco
industry. The need is for a balanced agenda on tobacco, both fiscal and
regulatory.
FMCG – Others
The Indian FMCG
industry is estimated to be over Rs.1600000.000 Millions
in size and accounts for nearly 2.2% of the GDP of the country. The industry
has tripled in size over the last 10 years and has grown at approximately 17%
CAGR in the last 5 years, driven by robust economic growth, rising income
levels, increasing urbanization and favourable demographic trends. These growth
drivers are expected to continue to favourably impact the industry which is
estimated to reach Rs.4000000.000 Millions
by 2020 (Source: CII, FMCG Roadmap to 2020). According to a recent study by the
consultancy firm Boston Consultancy Group, the Indian consumer market is poised
to growat a compounded annual growth rate of 15% between 2010 and 2020, faster
than most other emerging markets.
Given these
positive fundamentals, the Company has been rapidly scaling up its new FMCG
businesses comprising Branded Packaged Foods, Personal Care Products, Education
and Stationery Products, Lifestyle Retailing, Incense Sticks (Agarbattis) and
Safety Matches with Segment Revenues growing at an impressive compound annual
growth rate of nearly 40% since 2005-06. Within a relatively short span of
time, the Company has established several strong consumer brands in the Indian
FMCG market. Segment Results reflect the gestation costs of these businesses
largely comprising costs associated with brand building, product development, R and D and infrastructure
creation. The year saw a 24% growth in Segment Revenues and a significant
improvement in Segment Results which recorded a positive swing of Rs.1020.000
Millions at the PBIT level.
The Company’s
unwavering focus on quality, innovation and differentiation backed by deep
consumer insights, world class R and D and an efficient and responsive supply
chain will further strengthen its leadership position in the Indian FMCG
industry.
Branded Packaged
Foods
The Company’s
Branded Packaged Foods business grew significantly during the year, recording
growth in market shares and enhanced market standing across segments. A robust range
of well-differentiated products, supported by significant investments in
product development, innovation, manufacturing technology and unmatched
distribution infrastructure continue to enhance the market standing and
consumer franchise of the Company’s brands. Continuing investments in R and D
and product development have enabled the Company launch successful and
innovative products. The quality of the Company’s products continues to be
‘best-in class’ in the industry across all segments. Value capture was improved
through cost optimization across the supply chain and optimal capital
deployment.
During the year,
the business witnessed inflationary pressures on input costs. Supply side
constraints coupled with growing demand caused prices of edible oil, packaging
material and industrial fuel to remain at inflated levels. These cost pressures
were mitigated through a combination of improvements in product and process
efficiencies, smart sourcing and supply chain initiatives.
The Company
ventured into the Instant Noodles category towards the end of 2010. The product
has been well received by consumers and is already the second largest Instant
Noodle brand in the country. Focused market research, deep consumer insights
and innovative product formats under the ‘Sunfeast Yippee!’ brand is expected
to further
strengthen consumer traction in a fast growing and highly competitive industry
segment. In the Staples category, ‘Aashirvaad’ atta consolidated its leadership
position aided by the strong performance of Aashirvaad ‘Multi-grain’ atta.
Premium offerings of Aashirvaad ‘Multi-grain’ and ‘Select’ brands continued to
grow rapidly aided by an increasing proportion of consumers shifting to these
value-added propositions.
The Biscuits
industry witnessed impressive growth during the year and the Company’s
‘Sunfeast’ brand continued to do well across product platforms. Portfolio
enrichment was driven through the launch of Sunfeast Dark Fantasy Choco Fills
and Sunfeast ‘Dual’ Dream Cream. These two innovative, ‘first to market’
flavours created excitement amongst consumers and significantly enhanced the
consumer franchise of the ‘Sunfeast’ brand.
In the
Confectionery category, ‘Candyman’ and ‘mint-o’ continued to register strong
growth during the year. The category witnessed two launches with mint-o GOL
Green and mint-o Strong. The continued success of Toffichoo,
Lacto and
Choco-Double éclairs provided further impetus to the overall growth of the
Confectionery business.
In the Savoury
Snacks segment, the market standing of the Company’s ‘Bingo!’ brand has
significantly improved through enhanced brand building efforts. Use of digital
media, word of mouth and clutter breaking advertisements improved brand
salience. The product portfolio was further strengthened during the year with
the launch of a new product format - ‘Tangles’ and a new innovative variant -
‘Mad Angles Masti Chaat’.
The business
continues to invest in manufacturing and distribution infrastructure to support
larger scale and improve reach and availability. Supply Chain improvements to
enhance product freshness, optimal servicing of proximal markets and margin
expansion continue to receive significant attention.
Buoyed by
increasing consumer franchise for the Company’s brands, it is expected that the
accelerated growth of the Branded Packaged Foods business will be sustained in
the years ahead. The growth momentum of the Foods business will continue to be
driven by focus on product quality, innovative product development, multi-point
contact with consumers and high quality of service to all segments of trade.
Personal Care Products
The Company’s
Personal Care Products business continued to make significant strides in
strengthening its portfolio through a slew of new launches and extensions in
the Soaps, Shampoos and Skin Care categories. The business continues to roll
out its product offerings under the ‘Essenza Di Wills’, ‘Fiama Di Wills’,
‘Vivel’ and ‘Superia’ brands across new geographies and is focused on addressing
various consumer benefits with the introduction of new variants.
The year saw the
successful introduction of a new range of soaps under the ‘Vivel’ franchise
with the launch of ‘Vivel Luxury Créme’ variant and a new offering ‘Vivel Clear
3-in-1’ in the transparent soap segment. The Company continues to receive
accolades for its product innovation initiatives. In continuation of previous
years’ trends, this year, the ‘Vivel Clear 3-in-1’ transparent soap was voted
‘Product of the Year’ in the soaps category.
The business
entered the Talcum Powder category during the year with the launch of 3
variants under the Fiama Di Wills brand. During the year, the business also
made a foray into the fast growing
The business
continued to grow at a healthy rate despite the high degree of competitive
intensity especially from entrenched players. The strategy of developing
products on the basis of deep consumer insights and superior quality has helped
the Company gain market standing in a short span of time.
The year witnessed
sharp escalation and volatility in the prices of key inputs. The Company used
a mix of smart
sourcing strategies, value engineering and cost control measures to mitigate
the impact thereof and enhance margins.
During the year,
the factory at Manpura received certifications for ISO 9001 (Quality Management
System), ISO 14001 (Environment Management System) and OHSAS 18001
(Occupational Health and Safety Assessment System) from Messrs. Det Norske
Veritas (DNV). With this, the main production units of the business are
certified for their quality management systems. A business-wide programme using
‘Lean’ and ‘Six Sigma’ methodologies, which was launched last year, was further
broad-based during the current year in pursuit of process excellence.
Sustained
investment in RandD over the years has resulted in a healthy pipeline of new
and innovative products. Product innovation and quality continue to be focus
areas that are expected to provide the requisite competitive advantage and
impetus for growth in the near future. These interventions, together with
investments in world class manufacturing processes and technology will enable
the business to further strengthen its portfolio of value-added products.
The Personal Care
industry in
Education and
Stationery Products
The Company is the
leading and fastest growing player in the Indian stationery market. The
flagship brand ‘Classmate’ is
The Classmate
range of products is sourced from small scale manufacturers, who have over the
years continuously improved their delivery and quality capabilities. A majority
of them, with the Company’s assistance, are ISO 9001:2008 certified. Paper and
recycled board are sourced from the Company’s mills at Bhadrachalam and Kovai
respectively. The paper used in Classmate notebooks leverages the Company’s
world class fibre line at Bhadrachalam which is
During the year,
the business took significant steps to strengthen ‘Paperkraft’, its executive
and office supplies
stationery brand.
Working in tandem with the Paperboards and Specialty Paper business, the
Company has positioned ‘Paperkraft’ as the finest green paper for business
applications viz. copy-scan-print-fax. Paperkraft’s green credentials are
supported, among other factors, by the Company’s membership of the prestigious
The education and
stationery products industry continues to grow on the back of massive
government and private investments in the education sector. The government’s
flagship Sarva Shiksha Abhiyan programme coupled with the mid-day meals
initiative is successfully enhancing enrolment and reducing dropouts at the
primary school level. Likewise, it is expected that enrolment ratios at the
secondary and tertiary levels will also improve. Progressive reforms will
enable flow of private sector investments into capacity building and quality
enhancement in education delivery. Further, the Right of Children to Free and
Compulsory Education Act, 2009, will further accelerate growth in the education
and stationery supplies sectors. The Company’s strong brands – ‘Classmate’ and
‘Paperkraft’ – with increasing consumer franchise, widening high quality
product range and excellent distribution infrastructure is advantageously
positioned to respond to this opportunity.
Lifestyle
Retailing
During the year,
the Company’s Lifestyle Retailing business posted strong growth in revenues and
continued to strengthen its position in the branded apparel market. After a
buoyant first half, industry growth moderated in the second half due to the
slowing down of the domestic economy and price increases effected by most
industry players consequent to the introduction of Excise Duty on branded
apparel in the Union Budget 2011 and rising input costs. The business’s focus
on strategic cost management actions and improvements in operational
efficiencies helped to partly offset the adverse impact of tax and cost
increases.
In the Premium
segment, Wills Lifestyle with its superior product variety and richer product
mix continued to enjoy
strong consumer
franchise. The retail footprint of the brand was expanded to 86 exclusive
stores across 40 cities and more than 300 ‘shop-in-shops’ in leading
departmental stores and multi-brand outlets. Significant improvements were
achieved during the year in terms of product range, enhanced availability and
impactful visibility resulting in volume growth across channels.
Product appeal was
enhanced through the introduction of differentiated offerings across several
premium product
platforms –
‘Wonderpress’ wrinkle free fabrics, ‘Ecostyle’ organic collection and ‘Créme de
Cotton’ supersoft cottons. The ‘Luxuria’ range of Men’s super-premium formals,
finely crafted from luxurious Egyptian cotton with high-end trims and superior
garmenting continued to receive positive consumer response. The Women’s range
was energised by offering an extensive, high-end designer wear range, stylised
formals, a variety of trendy silhouettes and a premium range of accessories.
In the Popular
segment, ‘John Players’ has established a strong pan-India presence with over
340 flagship stores and 1,100 multi brand outlets and departmental stores.
During the year, the retail footprint was expanded significantly, with nearly
100 new stores being launched, increasing brand reach, penetrating more markets
and acquiring new franchise. The denims category registered strong growth as a
result of an enhanced
range, premium
differentiated washes and contemporary fits while continuing to receive
positive consumer and
trade response.
Wills Lifestyle
continued to receive recognition from the industry, including the ‘Superbrand’
certification, and is the first Indian brand to receive the prestigious
‘Oeko-Tex Standard 100 Certification’.
The
business will continue to increase the premium quotient of its offerings on the
basis of deeper understanding of consumer preferences, and delivering products
benchmarked to world class quality standards. Further investments are planned
to enhance range vitality, supply chain responsiveness and superior customer
service to delight the customer with an international shopping experience.
Incense sticks
(Agarbattis)
The Company’s
Agarbatti business recorded an impressive growth in revenues and enhanced
market standing during the year, driven by increasing consumer franchise for
the ‘Mangaldeep’ brand combined with deeper distribution reach and innovative
consumer offerings. Mangaldeep is the second largest national brand in the
industry.
During the year,
the business launched several new variants under the umbrella brand
‘Mangaldeep’. These variants have received wide consumer acceptance and are being
rolled out across
The business
continues to contribute to the Company’s commitment to the ‘Triple Bottom Line’
by providing livelihood opportunities to more than 12,000 people through small
and medium scale entrepreneurs and NGOs / Self Help Groups across
Safety Matches
The Company’s
Safety Matches business maintained its market leadership aided by continued
consumer preference for its strong brand portfolio across all market segments.
With sustained
escalation in the prices of raw materials like wood, paperboard and key
chemicals, industry margins remained under severe pressure during the year. The
Company mitigated the adverse impact of these input costs through a series of
strategic cost management actions. The Company continues to focus on enhancing
market standing through the launch of high quality and value-added products.
The Company continues
to partner the small scale sector by sourcing a significant portion of its
requirement from multiple units in this sector. The Company is helping to
improve the competitive ability of these units by providing technical inputs to
strengthen their systems and processes.
Technology
induction in manufacturing is crucial for the long term sustainability of this
industry. A uniform taxation
framework which
provides a level playing field to all manufacturers is necessary to enable the
required investments for modernising this industry. This would not only help
the industry in improving its competitiveness
but also provide a
safer working environment for the large number of people employed in this
industry.
B. HOTELS
The hospitality
industry in
economic
environment in the international feeder markets of the
be on the path of
slow recovery, the European market is yet to come out of its debt problems and
recession. As a result, both international and domestic business segments for
the luxury hotels remained muted.
In the backdrop of
these challenging circumstances, the Company’s Hotels business registered a
marginal growth in revenues and profits, while maintaining its leadership
position in terms of operating margins.
The Company’s
Hotels business continues to be rated amongst the fastest growing hospitality
chains with 94 properties at 67 locations in India operating under 4 brands –
‘ITC Hotel’ at the luxury end, ‘WelcomHotel’ in the 5 star segment, ‘Fortune’
in the mid market to upscale segment and ‘WelcomHeritage’ in the heritage
leisure segment. In addition, the business has licensing and franchising
agreements for two brands – ‘The Luxury Collection’ and ‘Sheraton’ with the
Starwood Hotels and Resorts.
Recognising the
changing preferences of the business traveller, the Company launched a new
brand under the ‘Fortune’ brand this year viz. ‘My Fortune’ which is designed
to cater to the upscale business traveller. The first ‘My Fortune’ hotel was
launched in Chennai during the year and further expansion is on the anvil.
During the year, the Company’s premier hotel at Jaipur has been upgraded to an
‘ITC Hotel’ with ‘The Luxury Collection’ co-branding. The hotel is now known as
‘ITC Rajputana’ in line with other luxury properties of the chain.
Food and Beverage
(FandB) remains a major strength of the Company and its iconic brands ‘
In pursuit of the
Company’s ‘Triple Bottom Line’ commitment, investments have been made in
renewable energy to provide clean power to the Company’s hotels in Bengaluru (ITC
Windsor and ITC Gardenia), Mumbai (ITC Maratha) and Jaipur (ITC Rajputana).
During the year, further investments in wind energy were made in Tamil Nadu to
cater to the needs of the newly built ITC Grand Chola at Chennai. With these
investments, the Company’s Hotels business will meet nearly two-thirds of its
energy requirements from clean and renewable sources.
The
Company remains committed to its ‘Responsible Luxury’ ethos and is the greenest
luxury hotel chain in the world. With ITC Rajputana having obtained the
‘Leadership in Energy and Environment Design’ (LEED) Platinum rating during the
year, all premium ITC Hotels now have this coveted rating.
During
the year, the Company launched a unique pan-ITC consumer loyalty programme –
‘Club ITC’ – targeted at the premium clientele of ‘Wills Lifestyle’ and ‘ITC
Hotels’.
In
view of the positive long term outlook for the Indian Hotel industry, the
Company continues to sustain its investment-led growth strategy. Construction
of the new super luxury property, ITC Grand Chola, at Chennai is now complete
and slated to open in early 2012-13. The hotel is part of the ‘ITC Hotel’ brand
and has 522 plush hotel rooms and suites, 78 service apartments, 60,000 sq. ft.
of conference and banqueting facilities, 10 Food and Beverage outlets and the
award-winning spa brand ‘Kaya Kalp’. Construction activity of two new luxury
properties at Kolkata and at Classic Golf Resort near Gurgaon is progressing
satisfactorily. In addition, several new projects, including joint ventures and
management contracts, are on the anvil to rapidly scale up the business across
all brands.
The
‘Fortune’ brand which caters to the mid market to upscale segment continued its
expansion by forging new alliances, taking the total number of hotels in its
fold to 67 with an aggregate room inventory of over 5,000. Of these, 27
properties are under various stages of development. The ‘WelcomHeritage’ brand
continues to be the country’s most successful and largest chain of heritage
hotels with 40 operating properties, spread across 13 States in
The
Company’s Hotels business, with its globally benchmarked levels of product and
service excellence and customer centricity, represented by its four brands is
well positioned to sustain its leadership status in the industry and poised to
emerge as the largest hotel chain in the country over the next few years.
Paperboards and
Specialty Papers
The global demand
for paper and paperboard slowed down to 1% in 2011 as against a 6% growth in
2010. Even in
The global paper
market continued to witness a structural shift with emerging economies,
particularly in
as
Though
Shift in demand to
Asia and the low levels of per capita consumption in
Further, reduction
of import duties under various Regional Free Trade Agreements especially with
ASEAN has started impacting the profitability of the domestic paper industry.
In line with the representations made by the Indian Paper Manufacturers
Association, it is imperative that the current duty structures are kept
unchanged.
The domestic paper
and paperboard industry is currently estimated at 11.6 million tonnes per
annum, out of which
paperboards is 2.2
million tonnes per annum which is expected to grow at around 8% per annum aided
by value-added paperboard at 12% per annum. The growth potential of the
paperboard industry is anchored on expectations of higher GDP growth, increase
in demand from rural markets, branded packaged products and organised retail.
Further, the need for differentiated packaging coupled with change in
lifestyles will continue to drive demand for paperboard. The Company is the
market leader in the paperboard segment with focus on the value-added products.
To further consolidate its pre-eminent position in the industry, the business
has invested in a state-of-the-art machine which is expected to be operational
by early 2013.
The ‘Writing and
Printing’ paper segment, estimated at 3.1 million tonnes, grew by 6.2% in the
year. This segment produces papers for use in copiers, desktop printers,
advertising and promotional materials, notebooks, books and annual reports. The
growth in the value-added writing and printing paper segment will continue to
be fuelled by initiatives like Sarva Shiksha Abhiyan and Right of Children to
Free and Compulsory Education Act, 2009 as well as by increasing literacy
levels, changing demographic profiles and GDP growth. This segment is expected
to grow at around 8% per annum during the next 5 years, with higher growth
expected in the Copier and Fine Paper categories at 16% per annum. The business
with its strong forward linkages with the Company’s Education and Stationery
Products business has emerged as a leading player in the segment.
Specialty papers,
with an estimated market size of 0.470 Millions tonnes, is expected to grow at
9.4% per annum over the next 5 years, with increased spends on infrastructure
and construction driving demand for quality décor and insulating grades. The
Company is a market leader in decor grades and is the largest manufacturer of
cigarette tissue in
Given that
pulpwood availability is a major challenge for the paper industry, the Company
continues with its policy of promoting social forestry plantations for
pulpwood. During the year, over 57 million high quality saplings were
sold/distributed to farmers. Research on clonal development has resulted in the
introduction of high yielding and disease resistant clones which are adaptable
to a wide variety of agro-climatic conditions. potential of the paperboard
industry is anchored on expectations of higher GDP growth, increase in demand
from rural markets,
and
disease resistant clones which are adaptable to a wide variety of agro-climatic
conditions.
This
initiative, besides securing the long term supply of fibre at competitive
costs, also assists in generating farm incomes through utilisation of marginal
wastelands. Enhanced RandD activity has resulted in the development of high
yielding eucalyptus and subabul clones and the Company’s continued focus on
clonal plantations in core areas is expected to yield significant competitive
advantage in the years to come. The Company’s RandD team is actively
collaborating with several expert agencies to further leverage bio-technology
for enhancing farm productivity and wood yields.
In
the last 15 years, the Company’s bio-technology based research initiatives have
resulted in the planting of about 545 million saplings covering nearly 1,25,000
hectares of plantations, including around 11,000 hectares planted during the
year. These pioneering initiatives have generated over 56 million person days
of employment opportunities over this period for small farmers and poor
tribals. The Company plans to accelerate the plantation activity and is in the
process of setting up a new state-of-the-art clonal saplings production
capacity in Bhadrachalam to facilitate the same.
The
Company continues to promote agro-forestry in pulpwood plantations on waste land
as well as on land where mono-cropping is practised. This will generate
additional income to farmers, provide wood security for the industry and also
help in conservation of the environment. In Andhra Pradesh, mono-cropping is
currently practised in cultivation of cotton, tobacco, maize and pulses in more
than 30 lakh hectares. During the year, the Company facilitated the
introduction of agro-forestry models which incorporate inter-cropping practices
where eucalyptus trees are grown adjacent to agricultural crops. By integrating
tree growing with crop production, the problems of poor agricultural
production, worsening wood shortages and environmental degradation can be
simultaneously addressed. Furthermore, inter-cropping technologies/practices
also help to take pressure off the remaining natural forests and increases the
diversity of vegetation on existing farms. During the year, a small beginning
was made by the Company by promoting agro-forestry plantations in 600 hectares
and this is proposed to be substantially increased in the years to come.
The
Company continues to represent to policy makers on the need to introduce
appropriate amendments to the
In
facilitate
waste paper recycling, with a view to conserving scarce natural resources. The
waste paper industry is largely unorganised and a lot of effort has gone into
establishing processes and systems in the operational areas of collection,
sorting and grading of waste paper as well as on accounting, compliances and
controls. It is expected that this effort would assist in the availability of
quality fibre on a sustained and long term basis at competitive prices.
During
the year about 26,000 tonnes of waste paper was collected and with continued
focus on building capability it is expected that the entire waste paper requirements
of the business would be sourced through this initiative over time. The first
anniversary of National Recycling Day was celebrated in
During
the year, the Company achieved the distinction of being the first paper company
in
FSC–FM
certifies that the plantation activities of an organisation are economically,
socially and environmentally viable. To the extent of pulp produced from such
certified plantations, the Company will be able to commit to its customers, FSC
certified papers and paperboards. Environmentally conscious customers are
already beginning to show keenness to source such ‘green’ products which in
turn will further increase the competitiveness of the business.
During
the year, the Tribeni and Bollaram units also obtained the FSC Chain of Custody
Certification ensuring that all four paper manufacturing units of the Company
now have this certification.
The
Company has made significant investments in contemporary technologies including
environment-friendly Elemental Chlorine-Free (ECF) and Ozone bleaching for pulp
thereby improving the environmental standards of its manufacturing operations.
Such investments are expected to provide customers with sophisticated products,
way ahead of legislation, thereby creating new benchmarks in environmental
stewardship. The Industry would welcome policies that lay down environmental
benchmarks in tune with other industries such as automotives etc. and suitably
reward those who achieve or exceed such parameters.
The
Company continues to focus on recycling initiatives including solid waste
recycling. While all manufacturing
units
have already achieved near 100% solid waste recycling by its usage for making products
like lime, fly ash bricks, grey boards, egg trays etc., the procurement and
recycling of about 1,10,000 tonnes of waste paper during the year has further
consolidated the business’s overall positive solid waste recycling footprint.
The
Company continues to work on various Clean Development Mechanism (CDM)
projects. The Company’s unique social forestry project is the first of its kind
in
During
the year, the following awards of the British Safety Council were received by
respective units - The ‘Sword
of
Honour’ by Tribeni and Bollaram units, the ‘Globe of Honour for Environment’ by
Bhadrachalam and Kovai units, 5 Star rating for Safety and Health by Kovai,
Tribeni and Bollaram units and 5 Star rating for Environment by
Bhadrachalam
and Kovai units. In addition, Bhadrachalam unit won the CII - National Award
for Excellence in Energy Management and Kovai unit won the CII - National award
for Excellence in Water Management. The business also won the CII –
Environmental Best Practices Award 2012 for its ‘WOW’ initiatives.
The
above have been made possible as a result of continuous focus on various safety
initiatives including induction of safety stewards, strengthening systems,
spreading awareness and integrating environment, health and safety (EHS) as
part of the overall Total Productive Maintenance (TPM) initiative. In addition,
all units have taken proactive steps to comply with the revised norms expected
to be announced by the Central Pollution Control Board for water consumption
and effluent discharge. With regard to energy consumption, strategies to
contain usage across units continue to be pursued. Further, the business is
also investing in a new high pressure fuel efficient boiler in its Tribeni
unit, which will enable use of inferior grades of coal and also significantly
reduce coal consumption. The Company is also committed to increasing the share
of energy consumed from non-conventional and renewable sources and towards this
has commissioned 5 windmills close to
The
TPM initiative has now been extended to all units and apart from yielding
significant financial benefits will also help institutionalise best-in-class
systems, processes and work methods. The success of this initiative is
attributable to the whole hearted support and participation of all employees
across the business.
The
year witnessed steep hikes in the cost of chemicals and coal as well as
curtailment in supplies
of
coal by the government through the reduction of allocations, forcing the
industry to buy high cost coal in the open market. These factors, together with
the sharp depreciation of the Indian Rupee, adversely impacted the industry.
However, the Company with its integrated operations and strategic cost
management actions was able to minimise the adverse impact of these cost
escalations.
The
integrated nature of the business model – access to high-quality fibre from the
economic vicinity of the Bhadrachalam mill, in-house pulp mill and
state-of-theart manufacturing facilities, focus on value-added paperboards and
a robust forward linkage with the Education and Stationery Products business
strategically positions the Company to further consolidate and enhance its
leadership status in the Indian paperboard and paper industry.
Packaging and
Printing
The Company’s
Packaging and Printing business continues to provide contemporary and superior
packaging solutions facilitated by its state-of-the-art technology and
processes. The business continues to provide strategic support to the Company’s
FMCG businesses by providing innovative packaging solutions and security of
supplies in addition to delivering benchmarked international quality at
competitive costs.
The business
continued to leverage its multiple packaging platforms to expand business in
the domestic and export markets, and grew volumes both from existing customers
as well as from enlargement of its customer base. The Company continues to be a
leading supplier of value added packaging to the Consumer Electronics and FMCG
sectors.
During the year,
the business continued to invest in contemporary technologies in flexibles and
paperboard packaging at the Haridwar and Chennai facilities. These in-house
capabilities have enabled quicker turnaround The year witnessed steep hikes in
the cost of chemicals and coal as well as curtailment in supplies of coal by the
government through the reduction of allocations, forcing the industry to buy
high cost coal in the open market. These factors, together with the sharp
depreciation of the Indian Rupee, adversely impacted the industry. However, the
Company with its integrated operations and strategic cost management actions
was able to minimise the adverse impact of these cost escalations.
The integrated
nature of the business model – access to high-quality fibre from the economic
vicinity of the Bhadrachalam mill, in-house pulp mill and state-of-theart
manufacturing facilities, focus on value-added paperboards and a robust forward
linkage with the Education and Stationery Products business strategically
positions the Company to further consolidate and enhance its leadership status
in the Indian paperboard and paper industry.
Packaging and
Printing
The Company’s
Packaging and Printing business continues to provide contemporary and superior
packaging solutions facilitated by its state-of-the-art technology and
processes. The business continues to provide strategic support to the Company’s
FMCG businesses by providing innovative packaging solutions and security of
supplies in addition to delivering benchmarked international quality at
competitive costs.
The business
continued to leverage its multiple packaging platforms to expand business in
the domestic and export markets, and grew volumes both from existing customers
as well as from enlargement of its customer base. The Company continues to be a
leading supplier of value added packaging to the Consumer Electronics and FMCG
sectors.
During the year,
the business continued to invest in contemporary technologies in flexibles and
paperboard packaging at the Haridwar and Chennai facilities. These in-house
capabilities have enabled quicker turnaround
D. AGRI BUSINESS
Cigarette Leaf
Tobacco
While the end of
2010 marked a significant shift in the global supply-demand scenario triggered
by declining sales of major global cigarette manufacturers and excess leaf
production in major origins, 2011 witnessed a further continuation of this
declining trend of global cigarette production, impacted by the downturn in the
global economy. The downward correction in leaf tobacco demand led to world
supplies moving to a surplus situation and a rapid build up of uncommitted
stocks.
Consequently, farm
and export prices of Indian fluecured crop witnessed significant declines. In
line with subdued trends across the globe, Indian unmanufactured leaf exports
degrew by about 20% in volume terms since 2009.
The position for
Indian flue-cured
to high
differential taxes on the end use products, namely, cigarettes vis-á-vis other
types of tobacco. This gets further aggravated by the large scale import of
cigarettes, both legal and contraband, into
domestic
flue-cured
In the short term,
supply side corrections are anticipated in key origins after a period of
consecutive increases in
global flue-cured
leaf production driven by muted demand and manufacturers seeking to lower their
inventory durations. In the medium term, demand is expected to pick up
gradually with the anticipated revival of the global
economy coupled
with growing consumption in Asia, Middle East, parts of Europe and
Despite these
adverse conditions, the Company was able to sustain the demand for Indian
tobaccos through focused strategies leveraging its sources of competitive
advantage in crop development, product integrity, strategic sourcing and
superior processing capability. Significant volumes of flue-cured tobaccos were
garnered
through superior
understanding of customer requirements and delivering committed quality and
value to the customer. The Company continues to focus on superior quality and
varietal offerings to customers in the burley
segment through
collaborative and customized programmes. The business also engaged with
potential customers across the globe and actively explored market opportunities
in the growing smokeless tobacco segment through customised offerings.
The business
continued to provide strategic sourcing support to the Company’s Cigarettes
business. Achieving enhanced productivity continues to be a focus area of
research and crop development initiatives of the business. Substantial progress
has been made in strengthening the pipeline of new hybrid combinations for
deployment in growth zones. Significant milestones were achieved in the
development of a new curing regime for tobacco and further experimental trials
are underway to create a unique product portfolio.
The Company’s
pioneering R and D efforts on varietal improvements in leaf tobacco were
further fortified with the development of various burley and oriental type
tobaccos. These initiatives such as improved nursery management designed for
higher efficiencies in seed use, optimised usage of crop production chemicals
and other agronomic practices are helping improve the potential of newly
developed varieties. These efforts are not only helping secure global demand
for Indian leaf tobacco by providing enhanced value to global customers but
also in improving the socio-economic status of the small/tribal farmer.
Capitalising on the Company’s RandD efforts on varietal improvement, the area
under coverage of flue-cured
The Company
continues to focus on maintaining the highest quality and safety standards at
all its units. During the year, the Chirala and Anaparti factories received the
International Safety Award from the British Safety Council for ensuring ‘Best
Safety Management’ systems and the Anaparti unit was awarded the ‘National
Level Excellence in Water Management Award’, as ‘Excellent Water Efficient
Unit’ by CII.
To further enhance
quality and improve supply chain efficiencies, the Company commissioned a new
facility in Karnataka with a capacity of 35 million kgs per annum. This investment
will not only enhance in-house processing
capacity but is
also expected to reduce supply chain costs given the factory’s proximity to the
tobacco growing
regions in
Karnataka. The business is also actively engaged in augmenting its warehousing
capacities and reengineering its supply chain from a strategic cost management
perspective.
The Company with
its unmatched RandD capability, stateof- the-art facilities, unique crop
development and extension expertise, deep understanding of customer and farmer
needs, is well poised to leverage emerging opportunities for Indian leaf
tobacco and sustain its position as a world class leaf tobacco organisation.
Other Agri Commodities
The Indian food
grain production for the year is estimated at a record high of over 250 million
tonnes mainly on account of increase in production of rice and wheat. Wheat
output estimates are at an all-time high of about 90 million tonnes. Rice
production, at around 103 million tonnes, was higher than 96 million tonnes in
the previous year. Overall oil seed production was also on the higher side at
about 30 million tonnes. However,
continues to
import nearly 50% of its requirement of edible oil.
The international
soya bean market reflected a slowdown in arrival of quantities with all major
producers showing
a dip in
production. Overall global production was about 8% lower than the previous
year. While
and the
The Company
continued to source identity preserved, special varieties of wheat through its
e-Choupal network channel for its Branded Packaged Foods business. The
continuous focus on minimising bridging costs of wheat
for Aashirvaad
atta, while seeking to capitalise on geographical and varietal arbitrage
opportunities, provided a competitive advantage to the Company’s Foods
business. The external wheat business successfully catered to a wider range of
customers, such as brand owners, private labels, food processors and millers.
In the area of potato sourcing, the business continued to support the Foods
business by procuring the highest quality chip stock potatoes for the Company’s
Bingo! brand of potato chips. The endeavour of partnering with farmers to
source locally grown potatoes (closer to manufacturing units) helped minimise
logistics costs. Trials for the development of new varieties and new areas
continued during the year and such extension efforts helped significantly
increase potato crop this year in
During the year,
linkages with Indian Agriculture Research Institute (IARI) were strengthened
through an MOU to provide transfer of new varieties of wheat seeds to farmers
under Public Private Partnership (PPP). A number of farmer training programmes
along with farm demonstrations were also undertaken. Demonstrations of
remunerative horticulture crops which provide a higher income have also
benefitted farmers across the States of Madhya Pradesh, Tamil Nadu, Uttar
Pradesh and
Provision of rural
health services through the e-Choupal platform has also been initiated by the
Company. A ‘Market Based Partnership for Health’ programme was started on a
pilot basis in the previous year specifically focusing on improvement of
maternal and child health and hygiene. In alliance with the United States
Agency for International Development (USAID), village health champions were
identified and given specific inputs and training for dissemination and
creation of awareness among women. In alliance with partnering companies in the
health space, the village health champions also market the related health and
hygiene products whichin turn provide them with an avenue for income. With the
successful consolidation of this project in Gonda and Chandauli districts of
Uttar Pradesh, the Company now seeks to replicate the same across other areas
covered by the e-Choupal network. These initiatives will progressively
transform the e-Choupal network into an all-weather venture – relatively
de-risked from regulatory uncertainties and market volatility – even as it
continues to provide strategic sourcing support to the Company’s Branded
Packaged Foods business as well as to serve as an efficient model for rural
development.
NOTES ON SUBSIDIARIES
Surya Nepal
Private Limited
The operating
environment in
The company
consolidated its leadership position in the cigarette market through
unrelenting focus on providing consumers a wide range of product choices of
superior quality. On the manufacturing front, the company continued to invest
in new technology cigarette packing lines and development of human talent to
reinforce its market standing. The construction of a second factory near
Pokhara is in progress and will position the company well for meeting consumer
demand in the longer term.
The disturbed
industrial relations situation prevailing in Biratnagar Industrial belt, led to
frequent disruption of operations at the garments manufacturing unit. This
rendered export operations unviable and the company was constrained to close
down the facility. In the domestic branded apparel industry, the supply chain
and distribution infrastructure for ‘John Players’ and ‘Springwood’ brands were
further strengthened during the year.
In the Safety
Matches business, revenues of the company’s brand ‘Tir’, have grown by nearly
36% during the year, evidencing its strong and growing consumer franchise.
The company
continued to partner with tobacco farmers in
farm level through
the induction of agricultural best practices. Such efforts are expected to
result in sustainable benefits for both the farmer community and the company.
The company’s commitment to its role as a responsible corporate citizen was
further reinforced with initiatives such as the construction of a school
building for the local community proximate to the site of its second factory
near Pokhara and the institution of the ‘Surya Nepal Private. Limited. Asha
Social Entrepreneurship Awards’. At Simra, the company continued to support
multiple local community development programmes including health camps and
irrigation development. The company declared a dividend of NRs. 111.50 per
equity share of NRs. 100/- each for the year ended 16th July, 2011
(32nd Ashad 2068).
ITC Infotech India
Limited
The global IT
services industry continued to be impacted in 2011 by macroeconomic
uncertainties, particularly in
(a) ITC Infotech
India Limited registered a Total Revenue of Rs. 5662.300 Millions (previous year Rs. 4264.200 Millions) and a Net Profit of Rs. 286.900 Millions (previous year Rs. 74.600 Millions);
(b) ITC Infotech
Limited,
(c) ITC Infotech
(USA), Inc., (I2A) a wholly owned subsidiary of the company, together with its
wholly owned subsidiary Pyxis Solution LLC, registered Total Revenues of US$
49.85 million (previous year US$ 38.43 million) and a Net Profit of US$ 0.3
million (previous year US$ 0.01 million).
With a view to
securing the future, apart from expanding the company’s existing in-house
domain solution capabilities, specific development programmes have been
implemented to embrace disruptive technologies such as cloud computing, social
media and mobile computing. Further, as in the past, there was a selective
expansion of market presence in high potential geographies to leverage market opportunities
and also to serve as a measure of risk mitigation in the event of economic
challenges in other markets. Continuing the trend, during the year, branches
were set up in
While the quality
of delivery continues to delight global customers, the company has also been contributing
in a meaningful manner towards enhancing the competitiveness of the Company’s
other businesses. The implementation of ‘Club ITC’ - a pan-ITC loyalty
programme for the Company - on Siebel technology, is believed to be the first
of its kind in the world.
The company
launched its first software product in the Indian market during the year. Named
‘OptSustain’, this assists customers in managing and reporting corporate
sustainability performance. This is a notable addition to the portfolio of intellectual
property.
An externally
administered customer satisfaction survey indicates that customers have awarded
the company high scores, which are ranked amongst the top few in the industry.
While the scores validate the world class quality of service, retaining such
scores for the second year stands testimony to the commitment to continuously
raising the levels
of service to meet growing market expectations.
The overall
service delivery capability of the company continues to earn global
recognition. The company was featured for the sixth consecutive year in the
2011 Global Services 100 survey, conducted by Global Services and
Neo Advisory.
Leading analyst firms such as Gartner and Forrester Research continue to
highlight the company’s capabilities in industry and technology reports.
On the talent
management front, the company has implemented and continuously refines sharply
focused initiatives encompassing recruitment, training, engagement and
retention. The broad spectrum of services, coupled with growing client
engagements across the world, has created workplace challenges necessary to
motivate employees, offer attractive career growth opportunities and minimise
attrition. While uncertain economic conditions continue to persist,
particularly in developed markets which account for about 80% of IT services
spends, with a portfolio of differentiated solutions, strong customer
relationships, expanding market presence and excellence in delivery, the
company is confident of sustaining its robust growth.
Russell Credit
Limited
During the year,
the company registered a Total Revenue of Rs.405.800 Millions
and a Net Profit of Rs.314.300 Millions.
The company,
during the year, sold its entire holding in Ordinary Shares of Technico Pty
Limited,
Consequent to the
sale, both these companies became direct subsidiaries of the Company. As stated
in the Report of the Directors of the previous years, a petition was filed by
an individual in the High Court at Calcutta, seeking an injunction against the
company’s Counter Offer to the shareholders of VST Industries Limited (VST),
made in accordance with the Securities and Exchange Board of India (Substantial
Acquisition of Shares and Takeovers) Regulations, 1997, as a competitive bid,
pursuant to a Public Offer made by an Acquirer, which closed on 13th June,
2001.
The High Court at
Similar petitions
filed by an individual and two shareholders, in the High Court of Delhi and
High Court of Judicature of Andhra Pradesh at Hyderabad, had earlier been dismissed
by the respective High Courts.
Wimco Limited
The company
achieved a Net Revenue of Rs. 1700.000 Millions
during the year and posted a net loss for the year of Rs.459.900 Millions against Rs. 596.500 Millions loss in the previous year, primarily as a
result of one-time separation costs and steep increases in input costs. During
the year the company has raised Rs.595.600 Millions
through Rights issue of shares.
Margins in the Safety
Matches business continued to remain under pressure mainly due to escalation in
prices of raw materials like wood, splints, paperboard and key chemicals. The
business initiated several cost management measures to rationalise costs and
improve margins in this highly competitive category.
Availability of
critical raw materials like wood at competitive prices is crucial for the
success of the Safety Matches business. The Agro Forestry business of the
company is taking steps towards this end by supplying high quality poplar
sapling to farmers in
The recent Union
Budget 2012 accentuated the already disadvantaged position of the mechanised
Safety Matches industry by further increasing the differential in excise duties
between the mechanised and nonmechanised sectors. This has forced the company
to evaluate alternatives to arrive at a viable business model. In continuation of last year’s action to
enable better leveraging of the underlying asset base, a voluntary separation
scheme was effected at the Kolkata factory during the year.
The Engineering
business revenues grew by 19% during the year driven mainly by improved value
capture through continuous product development in packaging machinery. The
business plans to leverage new and improved product design to offer superior
packaging solutions to its customers.
The initiatives
taken by the company during the year to restructure its operations are expected
to yield positive results in the years to come.
Srinivasa Resorts
Limited
During the
financial year ended 31st March, 2012, the company recorded a Total Revenue of
Rs.576.600 Millions (previous year
Rs.560.400 Millions) and a Profit Before Tax
of Rs.118.900 Millions (previous year
Rs.128.500 Millions). Net Profit for the
year stood at Rs.94.000 Millions (previous
year Rs. 92.600 Millions).
The challenging
environment in the State of
During the year,
ITC Kakatiya obtained the prestigious Leadership in Energy and Environment
Design Platinum certification from the United States Green Building Council
(USGBC).
The hotel received
the ‘Times Food Guide’ awards for ‘Kebabs and Kurries’ and ‘Dakshin’ – with
both being rated as the best restaurants in their respective categories for the
third time in a row. In addition, the ‘Marco Polo’ bar received the award for
best outlet in its category.
The Board of
Directors of the company has recommended a dividend of ` 2/- per equity share
of ` 10/- each for the year ended 31st March, 2012.
Fortune Park
Hotels Limited
During the
financial year ended 31st March, 2012, the company recorded a Total Revenue of
Rs.207.800 Millions (previous year
Rs.180.100 Millions) and earned a Net Profit
of Rs. 49.600 Millions (previous year
Rs.41.200 Millions).
The company which caters
to the mid market to upscale segment continued its expansion by forging new
alliances, taking the total number of hotels in its fold to 67 with an
aggregate room inventory of over 5,000. The ‘Fortune’ brand now has 40
operating hotels and another 4 hotels are slated to be commissioned in the next
financial year. The remaining 23 hotel projects are under various stages of
development. The brand remains a frontrunner in its operating segment and is
well positioned to sustain its leadership position in the industry.
The company is
well known for providing quality products and services which have helped
position ‘Fortune’ as the premier ‘value’ brand in the Indian hospitality
sector. The ‘My Fortune’ brand, representing a ‘stylish lifestyle with efficient
personalised service’, is the latest addition to the bouquet of brands offered
by Fortune Hotels.
During the year,
the company was awarded the Hospitality India Award for the ‘Best First Class
Hotel Chain, 2011’ and Satte award for ‘Leading Mid - Market chain, 2012’.
Fortune Select Exotica, Navi Mumbai was awarded the ‘World Luxury Hotel Award’
for the year 2010 and 2011. The Board of Directors of the company has
recommended a dividend of Rs.10/- per equity share of Rs.10/- each for the year
ended 31st March, 2012.
Bay Islands Hotels
Limited
During the
financial year ended 31st March, 2012, the company recorded a Total Revenue of
Rs.13.700 Millions (previous year Rs.11.200 Millions) and a Net Profit of
Rs.9.200 Millions (previous year Rs.7.600 Millions).
The Board of
Directors of the company has recommended a dividend of Rs.65/- per equity share
of Rs.100/- each for the year ended 31st March, 2012.
Landbase India
Limited
The company owns
and operates the Classic Golf Resort, a Jack Nicklaus Signature Course, near
Gurgaon. As reported in the previous years, golf based resorts present
attractive long term prospects in view of their growing popularity all over the
world. The work towards creating a destination luxury resort hotel at the
Classic Golf Resort is now underway and the project is progressing as per
schedule.
During the year,
the company issued and allotted to the Company, 23,00,000 Redeemable Preference
Shares of ` 100/- each for cash at par, aggregating Rs.2.300 Millions. The
proceeds from the Preference Share issue are being utilised by the company for
the construction of the destination luxury resort.
Technico Pty
Limited
The company
continued to focus on upgrading the technituber Technology and consequent
commercialisation and field multiplication through its wholly owned
subsidiaries in different geographies. The company is also engaged in the
marketing of technituber seeds to global customers from the production
facilities of its subsidiaries in India, China and Canada.
During the year,
the Company acquired from its wholly owned subsidiary, Russell Credit Limited,
the entire shareholding of the company. The company’s leadership in the
production of early generation seed potatoes and strength in agronomy continue
to be leveraged by the Company not only for sourcing chip stock for the
‘Bingo!’ brand of the Company’s Branded Packaged Foods business but also for
servicing the seed potato requirements of the farmer base of the Company’s
Other Agri Commodities business.
a) Technico Pty Limited,
b) Technico Agri
Sciences Limited, India registered a Net Revenue of Rs.482.000 Millions (previous
year Rs.476.500 Millions) and a Net Profit of Rs.78.300 Millions (previous year
Rs. 70.200 Millions). During the year, production of potato in
c) Technico Asia
Holdings Pty Limited, Australia, Technico Technologies Inc., Canada and
Technico Horticultural (Kunming) Company Limited, China – There were no
significant events to report with respect to the above companies.
King Maker
Marketing Inc.
King Maker
Marketing Inc. (KMM) is a wholly owned subsidiary of the Company registered in
the State of
During the
financial year ended 31st March, 2012, the company recorded Net Sales of US$
26.95 million (previous year US$ 35.55 million) and earned Net Income of US$
0.48 million (previous year US$ 0.52 million). During the year, KMM continued
to face a challenging operating environment, post the Federal Excise Tax
increases of the previous year, which resulted in a decline of cigarette sales
volumes and revenues. The year also saw the major multinational companies
solidify their foray into the discount segment in which the company operates,
with tighter loyalty programmes, as consumers pursued value. Growth of Pipe
tobaccos as a substitute for ‘Roll the Own Tobacco’, cigarette manufacturing
machines at retail, presence of flavoured little cigars akin to cigarettes,
discount cigarettes manufactured in Native American reservations sans State
taxes, and illicit trade all challenged the company’s ability to drive volume
upturns. Consequently, KMM’s pricing power was stagnant. Improved cost metrics
nevertheless led to enhanced profitability.
Government regulations
in the tobacco sector continue to take shape. Theybelieve that the industry
will consolidate further as US Food and Drug Administration regulations evolve,
including in the Other Tobacco Product (OTP) categories like Pipe Tobaccos and
Cigars. The company will continue to attune its strategies based on emerging
opportunities in the market.
ITC Global
Holdings Pte. Limited
The Judicial
Managers had been conducting the affairs of ITC Global Holdings Pte. Limited
(‘Global’) since 8th November, 1996 under the authority of the High
Court of Singapore. Pursuant to the application of the Judicial Managers, the
Singapore Court on 30th November, 2007 ordered the winding up of Global,
appointed a
Liquidator and
discharged the Judicial Managers.
As stated in the
previous years’ Reports, the Judicial Managers of Global had filed a Writ
against the Company in November 2002 before the Singapore High Court claiming
approximately US$ 18.10 million. Based on legal advice, the Company filed an
appropriate application for setting aside the said Writ. On 2nd March, 2006 the
Assistant Registrar of the Singapore High Court set aside the service of Writ
of Summons on the Company and some individuals. Subsequently in November 2006,
the Company received a set of papers purportedly sent by Global including what
appeared to be a copy of the earlier Writ of Summons. The Company filed a fresh
Motion in the Singapore High Court praying for setting aside the said Writ of
Summons, which was upheld by the Assistant Registrar of the
Singapore High
Court passed an order dismissing the Company’s motion to set aside the Writ of
Summons.
The Company filed
an appeal against the Assistant Registrar’s decision which appeal was dismissed
by the Singapore High Court. Pursuant to legal advice, the Company has since
filed its defence in the trial proceedings.
BFIL Finance
Limited
The company
continues to focus its efforts on recoveries through negotiated settlements
including property settlements and pursuit of legal cases against various
defaulters. The company has no external liabilities outside the ITC group. The
company will examine options for further business opportunities at the
appropriate time.
Gold Flake
Corporation Limited, Wills Corporation Limited, Greenacre Holdings Limited and
MRR Trading and Investment Company Limited
There were no
major events to report with respect to the above companies.
NOTES ON JOINT VENTURES
ITC Filtrona
Limited
The Gross Revenue
of ITC Filtrona Limited for the year ended 31st December, 2011 was at
Rs.1810.000 Millions ( Rs.1390.000 Millions in 2010). Pre-tax profits for the
year were at Rs.156.000 Millions (Rs.121.000 Millions in 2010). The year saw an
overall improvement in sales volume along with a better product mix. The
company has been continually engaging in upgradation of its filter making
technology which has enabled the company maintain its leadership position and
technology edge over competition and cater to growth both in product mix and
volumes.
In order to strike
a balance between the need to sustain investments and growth in the future and
the expectation
of shareholders
for growing income, the Directors of the company have recommended a dividend of
` 9.00 per
ordinary share of
` 10.00 each for the year ended 31st December, 2011. The company strives to be
the quality benchmark in cigarette filters, offer superior filter solutions to
its customers and be the most preferred supplier to its customers. With
excellent product and market development support from its joint venture
partners, the company is well positioned for the future.
Maharaja Heritage
Resorts Limited
Maharaja Heritage
Resorts Limited, a joint venture of the Company with Jodhana Heritage Resorts
Private Limited, currently operates 40 heritage properties and is in the
process of adding 9 more properties across 14 States in
The company has 9
properties under the ‘Legend’ brand categorised as up-market and known for
providing superior service delivery and brand standards. The company also has
10 properties under the ‘Nature Resorts’ brand and 21 properties under the
‘Welcom Heritage Hotels’ brand.
Espirit Hotels
Private Limited
In July 2010, the
Company had entered into a joint venture for developing a luxury hotel complex
at Begumpet,
The company is in
the process of finalising the design and product configuration of the proposed development.
Preparatory
activity at the site is underway with a view to commencing excavation work
shortly.
Logix Developers
Private Limited
During the year,
the Company entered into a joint venture for developing a luxury
hotel-cum-service apartment complex at Sector 105 in NOIDA. Under the terms of
the Joint Venture Agreement, the Company acquired 26% equity stake in the joint
venture company, Logix Developers Private Limited. (LDPL) and will, inter-alia,
provide hotel operating services to LDPL under an Operating Services Agreement,
upon commissioning of the hotel.
PART I: STATEMENT OF UNAUDITED FINANCIAL RESULTS FOR THE
QUARTER ENDED 30TH SEPTEMBER, 2012
(RS. IN MILLIONS)
|
Particular |
3 month ended
30.09.2012 |
Preceding 3 months
ended 30.06.2012 |
6 Months
Ended 30.09.2012 |
|
|
(Unaudited) |
(Unaudited) |
(Unaudited) |
|
|
|
|
|
|
Gross Income |
104894.200 |
96873.400 |
201767.600 |
|
Gross Sales / Income From Operations |
102238.600 |
94565.400 |
196804.000 |
|
Excise Duties |
30778.600 |
28043.300 |
58821.900 |
|
|
|
|
|
|
Income From
Operations |
|
|
|
|
a) Net Sales / Income From Operations (Net of Excise Duty) |
71460.000 |
66522.100 |
137982.100 |
|
b) Other Operating Income |
805.800 |
608.600 |
1414.400 |
|
Total Income From
Operations (Net) (1+2) |
72265.800 |
67130.700 |
139396.500 |
|
|
|
|
|
|
EXPENSES |
|
|
|
|
a) Cost of materials consumed |
20794.100 |
20682.700 |
41476.800 |
|
b) Purchases of stock-in -trade |
11030.300 |
7579.100 |
18609.400 |
|
c) Changes in inventories of finished goods, work-in-progress and stock-in-trade |
(3180.600) |
(2495.600) |
(5676.200) |
|
d) Employee benefits expense |
2892.400 |
41.245 |
7016.900 |
|
e) Depreciation and amortisation expense |
1888.600 |
1947.900 |
3836.500 |
|
f) Other expenses |
13846.900 |
13488.400 |
27335.300 |
|
Total Expenses |
47271.700 |
45327.000 |
92598.700 |
|
|
|
|
|
|
Profit from operations before
other income and finance costs (3-4) |
24994.100 |
21803.700 |
46797.800 |
|
Other Income |
1849.800 |
1699.400 |
3549.200 |
|
Profit from ordinary activities
before finance costs (5+6) |
26843.900 |
23503.100 |
50347.000 |
|
Finance Costs |
232.900 |
137.600 |
370.500 |
|
Profit from ordinary activities
before tax (7-8) |
26611.000 |
23365.500 |
49976.500 |
|
Tax Expense |
8246.800 |
7344.100 |
15590.900 |
|
Net profit for the period (9-10) |
18364.200 |
16021.400 |
34385.600 |
|
Paid up equity share capital (Ordinary shares of Re. 1/- each) |
7856.300 |
7822.900 |
7856.300 |
|
Reserves Excluding Revaluation Reserves |
-- |
-- |
-- |
|
|
|
|
|
|
Earnings Per Share (of Re. 1/- each) (not annualised): |
|
|
|
|
(a) Basic (Rs.) |
2.34 |
2.05 |
4.39 |
|
(b) Diluted (Rs.) |
2.31 |
2.02 |
4.34 |
PART II: SELECT
INFORMATION FOR THE QUARTER AND HALF YEAR ENDED 30TH SEPTEMBER, 2012
(RS. IN MILLIONS)
|
Particulars |
3 month ended
30.09.2012 |
Preceding 3
months ended 30.06.2012 |
6 Months
Ended 30.09.2012 |
|
A. Particulars of Shareholding |
|
|
|
|
Public Shareholding |
|
|
|
|
Number Of Shares |
7832583758 |
7799131698 |
7832583758 |
|
Percentage Of Shareholding |
99.70 |
99.70 |
99.70 |
|
|
|
|
|
|
Promoters and Promoter Group
Shareholding |
Nil |
Nil |
Nil |
|
a) Pledged / Encumbered |
NA |
NA |
NA |
|
b) Non - encumbered |
NA |
NA |
NA |
|
B. Investor Complaints |
3 month ended
30.09.2012 |
|
|
|
|
Pending at the beginning of the quarter |
Nil |
|
Received during the quarter |
Nil |
|
Disposed of during the quarter |
Nil |
|
Remaining unresolved at the end of the quarter |
Nil |
NOTES:
(i) The Unaudited Financial Results, Segment Results and Statement of Assets and Liabilities were reviewed by the Audit Committee and approved at the meeting of the Board of Directors of the Company held on 19th October, 2012.
(ii) Figures for the previous periods are re-classified / re-arranged / re-grouped, wherever necessary, as per the format revised by SEBI in conformity with the amended Schedule VI to the Companies Act, 1956.
(iii) The Company does not have any Exceptional or Extraordinary item to report for the above periods.
(iv) Gross Income comprises Gross Sales / Income from Operations, Other Operating Income and Other Income.
(v) The launch and rollout costs of the Company's brands 'Fiama Di Wills', 'Vivel' and 'Superia' covering the range of personal care products of soaps, face washes, shower gels, shampoos, conditioners and skin care, and the continuing significant brand building costs of the Foods business are reflected under 'Other expenses' stated above and in Segment Results under 'FMCG-Others'.
(vi) Relevant expenses for ITC Grand Chola, the Company's 600-key super premium integrated luxury hotel complex in Chennai which was inaugurated on 15th September, 2012 are reflected under appropriate heads of expenses stated above and in Segment Results under 'Hotels'.
(vii) During the quarter, 3,33,66,580 Ordinary Shares of Rs.1/- each were issued and allotted under the Company's Employee Stock Option Schemes. Consequently, the issued and paid-up Share Capital of the Company as on 30th September, 2012 stands increased to Rs. 7856.294 Millions.
(viii) This statement is as per Clause 41 of the Listing Agreement.
LIMITED REVIEW
The Limited Review, as required under Clause 41 of the Listing Agreement has
been completed and the related Report forwarded to the Stock Exchanges. This
Report does not have any impact on the above 'Results and Notes' for the
Quarter ended 30th September, 2012 which needs to be explained.
UNAUDITED SEGMENT-WISE REVENUE, RESULTS AND CAPITAL
EMPLOYED FOR THE QUARTER ENDED 30TH SEPTEMBER, 2012
|
Particulars |
3 month ended
30.09.2012 |
Preceding 3
months ended 30.06.2012 |
6 Months Ended 30.09.2012 |
|
|
(Unaudited) |
(Unaudited) |
(Unaudited) |
|
1. Segment Revenue |
|
|
|
|
a) FMCG - Cigarettes - Gross |
64186.100 |
60613.700 |
124799.800 |
|
- Net |
33851.500 |
33042.400 |
66893.900 |
|
- Others - Gross |
17003.600 |
14792.900 |
31796.500 |
|
- Net |
16908.000 |
14730.500 |
31638.500 |
|
Total FMCG - Gross |
81189.700 |
75406.600 |
156596.300 |
|
|
|
|
|
|
- Net |
50759.500 |
47772.900 |
98532.400 |
|
|
|
|
|
|
b) Hotels - Gross |
2169.800 |
2323.900 |
4493.700 |
|
- Net |
2169.600 |
2323.500 |
4493.100 |
|
c) Agri Business - Gross |
20238.800 |
16914.200 |
37153.000 |
|
- Net |
20238.800 |
16914.200 |
37153.000 |
|
d) Paperboards, Paper and Packaging - Gross |
11216.800 |
11281.400 |
22498.200 |
|
- Net |
10590.000 |
10587.900 |
21177.000 |
|
Total - Gross |
114815.100 |
105926.100 |
220741.200 |
|
|
|
|
|
|
- Net |
83757.900 |
77597.600 |
161355.500 |
|
|
|
|
|
|
Less: Inter-Segment Revenue – Gross |
12576.500 |
11360.700 |
23937.200 |
|
Net |
12297.900 |
11075.500 |
23373.400 |
|
|
|
|
|
|
Gross sales
/ Income from operations |
102238.600 |
94565.400 |
196804.000 |
|
|
|
|
|
|
Net sales
/ Income from operations |
71460.000 |
66522.100 |
137982.100 |
|
|
|
|
|
|
2. Segment
Results |
|
|
|
|
a) FMCG - Cigarettes |
20801.700 |
18998.100 |
39799.800 |
|
- Others |
(303.100) |
(388.400) |
(691.500) |
|
Total FMCG |
20498.600 |
18609.700 |
39108.300 |
|
b) Hotels |
153.000 |
262.300 |
415.300 |
|
c) Agri Business |
2597.400 |
1713.700 |
4311.100 |
|
d) Paperboards, Paper
& Packaging |
2825.300 |
2647.100 |
5472.400 |
|
Total |
26074.300 |
23232.800 |
49307.100 |
|
|
|
|
|
|
Less : i) Interest
(including other finance costs) |
232.900 |
137.600 |
370.500 |
|
ii) Other un-allocable income net of unallocable expenditure |
(769.600) |
(270.300) |
(1039.900) |
|
|
|
|
|
|
Profit Before
Tax |
26611.000 |
23365.500 |
49976.500 |
|
|
|
|
|
|
Tax Expense |
8246.800 |
7344.100 |
15590.900 |
|
|
|
|
|
|
Profit After
Tax |
18364.200 |
16021.400 |
34385.600 |
|
|
|
|
|
|
3.
Capital Employed |
|
|
|
|
a) FMCG - Cigarettes * |
41678.500 |
41456.000 |
41678.500 |
|
- Others |
23594.000 |
20674.600 |
23594.000 |
|
Total FMCG |
65272.500 |
62130.600 |
65272.500 |
|
|
|
|
|
|
b) Hotels |
33866.800 |
33084.600 |
33866.800 |
|
c) Agri Business |
10984.000 |
16593.800 |
10984.000 |
|
d) Paperboards, Paper & Packaging |
46744.600 |
45571.200 |
46744.600 |
|
|
|
|
|
|
Total Segment
Capital Employed |
156867.900 |
157380.200 |
156867.900 |
Segment Liabilities of FMCG-Cigarettes is before considering Rs.7831.600 Millions (30.09.2011 - Rs.8077.900 Millions; 30.06.2012 - Rs.7760.000 Millions) in respect of disputed Taxes, the recovery of which has been stayed or where States' appeals are pending before Courts. These have been included under 'Unallocated Corporate Liabilities'.
NOTE:
·
The Company's corporate strategy aims at
creating multiple drivers of growth anchored on its core competencies. The Company
is currently focused on four business groups: FMCG, Hotels, Paperboards, Paper
and Packaging and Agri Business. The Company's organisational structure and
governance processes are designed to support effective management of multiple
businesses while retaining focus on each one of them.
·
The business groups comprise the following :
FMCG
Cigarettes: Cigarettes, Cigars and Smoking Mixtures.
Others: Branded Packaged Foods (Staples, Biscuits, Confectionery, Snack Foods, Pasta & Noodles, Ready to Eat Foods), Garments, Educational and other Stationery products, Matches, Agarbattis and Personal Care products
Hotels - Hoteliering.
Paperboards, Paper and Packaging - Paperboards, Paper including Specialty Paper & Packaging including Flexibles.
Agri Business - Agri commodities such as soya, spices, coffee and leaf tobacco
· Segment results of 'FMCG : Others' are after considering significant business development, brand building and gestation costs of Branded Packaged Foods and Personal Care Products businesses.
· ITC Grand Chola, the Company's 600-key super premium integrated luxury hotel complex in Chennai was inaugurated on 15th September, 2012. The Hotel has been accredited as the World's largest LEED Platinum rated hotel, in the new construction category. The segment results of 'Hotels' for the quarter and half year are after considering the relevant expenses of the new property.
The
Company's Agri Business markets agri commodities in the export and domestic
markets; supplies agri raw materials to the Branded Packaged Foods Business and
sources leaf tobacco for the Cigarettes Business. The segment results for the
quarter/half year are after absorbing costs relating to the strategic e-Choupal
initiative.
Figures
for the previous periods are re-arranged, wherever necessary, to conform to the
figures of the current period.
(RS. IN MILLIONS)
|
STATEMENT OF ASSETS AND LIABILITIES |
STANDALONE |
|
|
|
As at current (Unaudited) |
|
|
A |
EQUITY AND
LIABILITIES |
|
|
1 |
SHAREHOLDERS'
FUNDS |
|
|
|
(a) Share Capital |
7856.300 |
|
|
(b) Reserves and surplus |
218449.700 |
|
|
(c) Money received against share warrants |
- |
|
|
Shareholders' Funds |
226306.000 |
|
2 |
SHARE APPLICATION
MONEY PENDING ALLOTMENT |
- |
|
3 |
NON-CURRENT
LIABILITIES |
|
|
|
(a) Long-term borrowings |
734.500 |
|
|
(b) Deferred tax liabilities (net) |
9727.200 |
|
|
(c) Other long-term liabilities |
52.500 |
|
|
(d) Long-term provisions |
1122.900 |
|
|
Non-Current Liabilities |
11637.100 |
|
4 |
CURRENT
LIABILITIES |
|
|
|
(a) Short-term borrowings |
6793.400 |
|
|
(b) Trade payables |
15942.300 |
|
|
(c) Other current liabilities |
40126.900 |
|
|
(d) Short-term provisions |
5139.700 |
|
|
Current Liabilities |
68002.300 |
|
|
TOTAL EQUITY AND LIABILITIES |
305945.400 |
|
B |
ASSETS |
|
|
1 |
NON-CURRENT
ASSETS |
|
|
|
(a) Fixed assets |
119374.300 |
|
|
(b) Non-current investments |
19908.600 |
|
|
(c) Deferred tax assets (net) |
- |
|
|
(d) Long-term loans and advances |
16256.300 |
|
|
(e) Other non-current assets |
- |
|
|
Non-Current Assets |
155539.200 |
|
2 |
CURRENT ASSETS |
|
|
|
(a) Current investments |
4933.58 |
|
|
(b) Inventories |
6680.53 |
|
|
(c) Trade receivables |
923.45 |
|
|
(d) Cash and cash equivalents |
1758.24 |
|
|
(e) Short-term loans and advances |
576.99 |
|
|
(f) Other current assets |
167.83 |
|
|
Current Assets |
15040.62 |
|
|
TOTAL ASSETS |
30594.54 |
Fixed Assets
·
·
·
Railway Sidings
·
Plant and Machinery
·
Computer, servers and other I.T equipments
·
Furniture and Fittings
·
Motor Vehicles
·
Leasehold properties
·
Capitalized software
AS PER WEBSITE DETAILS
HISTORY AND EVOLUTION
Subject
was incorporated on August 24, 1910 under the name Imperial Tobacco Company of
India Limited. As the Company's ownership progressively Indianised, the name of
the Company was changed from Imperial
Tobacco Company of India Limited to India Tobacco Company Limited in 1970
and then to I.T.C. Limited in 1974.
In recognition of the Company's multi-business portfolio encompassing a wide
range of businesses - Cigarettes and Tobacco, Hotels, Information Technology,
Packaging, Paperboards and Specialty Papers, Agri-business, Foods, Lifestyle
Retailing, Education and Stationery and Personal Care - the full stops in the
Company's name were removed effective September 18, 2001. The Company now stands rechristened 'ITC
Limited'.
The
Company’s beginnings were humble. A leased office on
Though
the first six decades of the Company's existence were primarily devoted to the
growth and consolidation of the Cigarettes
and Leaf Tobacco businesses, the Seventies witnessed the beginnings of a
corporate transformation that would usher in momentous changes in the life of
the Company.
ITC's
Packaging and Printing Business
was set up in 1925 as a strategic backward integration for ITC's Cigarettes
business. It is today
In
1975 the Company launched its Hotels
business with the acquisition of a hotel in Chennai which was
rechristened 'ITC-Welcomgroup Hotel
Chola'. The objective of ITC's entry into the hotels business was rooted
in the concept of creating value for the nation. ITC chose the hotels business
for its potential to earn high levels of foreign exchange, create tourism
infrastructure and generate large scale direct and indirect employment. Since
then ITC's Hotels business has grown to occupy a position of leadership, with
over 100 owned and managed properties spread across
In
1979, ITC entered the Paperboards
business by promoting ITC Bhadrachalam Paperboards Limited, which today
has become the market leader in
In
1985, ITC set up Surya Tobacco Co. in
In
1990, ITC acquired Tribeni Tissues Limited, a Specialty paper manufacturing
company and a major supplier of tissue paper to the cigarette industry. The
merged entity was named the Tribeni Tissues Division (TTD). To harness
strategic and operational synergies, TTD was merged with the Bhadrachalam
Paperboards Division to form the Paperboards
and Specialty Papers Division in November 2002.
Also
in 1990, leveraging its agri-sourcing competency, ITC set up the Agri Business Division for export of
agri-commodities. The Division is today one of
In
2000, ITC forayed into the Greeting, Gifting and Stationery products business
with the launch of Expressions range of greeting cards. A line of premium range
of notebooks under brand “Paperkraft”
was launched in 2002. To augment its offering and to reach a wider student
population, the popular range of notebooks was launched under brand “Classmate” in 2003. “Classmate” over the years has grown
to become
ITC
also entered the Lifestyle Retailing business with the Wills Sport range of international quality relaxed wear for men
and women in 2000. The Wills Lifestyle chain of exclusive stores later expanded
its range to include Wills Classic
formal wear (2002) and Wills
Clublife evening wear (2003). ITC also initiated a foray into the
popular segment with its men's wear brand, John Players, in 2002. In 2006, Wills Lifestyle became title
partner of the country's most premier fashion event - Wills Lifestyle India Fashion Week - that has gained recognition
from buyers and retailers as the single largest B-2-B platform for the Fashion
Design industry. To mark the occasion, ITC launched a special 'Celebration
Series', taking the event forward to consumers.
In
2000, ITC spun off its information technology business into a wholly owned
subsidiary, ITC Infotech India Limited,
to more aggressively pursue emerging opportunities in this area. Today ITC
Infotech is one of India’s fastest growing global IT and IT-enabled services
companies and has established itself as a key player in offshore outsourcing,
providing outsourced IT solutions and services to leading global customers
across key focus verticals - Manufacturing, BFSI (Banking, Financial Services
and Insurance), CPG and R (Consumer Packaged Goods and Retail), THT (Travel,
Hospitality and Transportation) and Media and Entertainment.
ITC's
foray into the Foods business is an outstanding example of successfully blending
multiple internal competencies to create a new driver of business growth. It
began in August 2001 with the introduction of 'Kitchens of India' ready-to-eat Indian gourmet dishes. In 2002,
ITC entered the confectionery and staples segments with the launch of the
brands mint-o and Candyman confectionery and Aashirvaad atta (wheat flour). 2003
witnessed the introduction of Sunfeast
as the Company entered the biscuits segment. ITC's entered the fast growing
branded snacks category with Bingo!
in 2007. In eight years, the Foods business has grown to a significant size
with over 200 differentiated products under six distinctive brands, with an
enviable distribution reach, a rapidly growing market share and a solid market
standing.
In
2002, ITC's philosophy of contributing to enhancing the competitiveness of the
entire value chain found yet another expression in the Safety Matches initiative. ITC now markets popular safety matches brands like iKno, Mangaldeep, Aim, Aim Mega and Aim Metro.
ITC's
foray into the marketing of Agarbattis
(incense sticks) in 2003 marked the manifestation of its partnership
with the cottage sector. ITC's popular agarbattis brands include Spriha and Mangaldeep across a range of fragrances like Rose, Jasmine,
Bouquet, Sandalwood, Madhur, Sambrani and Nagchampa.
ITC
introduced Essenza Di Wills, an
exclusive range of fine fragrances and bath and body care products for men and
women in July 2005. Inizio, the signature range under Essenza Di Wills provides a comprehensive grooming regimen with
distinct lines for men (Inizio Homme)
and women (Inizio Femme).
Continuing with its tradition of bringing world class products to Indian
consumers the Company launched 'Fiama
Di Wills', a premium range of Shampoos, Shower Gels and Soaps in September,
October and December 2007 respectively. The Company also launched the 'Superia' range of Soaps and Shampoos
in the mass-market segment at select markets in October 2007 and Vivel De Wills and Vivel range of
soaps in February and Vivel
range of shampoos in June 2008.
PRESS RELEASE
NET PROFIT UP BY 21.3%
19, October 2012
|
Highlights |
|
Net Revenue : +19.6% Non-Cigarette FMCG segment registers robust revenue
growth of 26.4% and improves profitability ITC Grand Chola, the world’s largest LEED
Platinum rated hotel in the New Construction category, launched in September
2012 |
The Company posted yet another quarter of impressive results with
healthy topline growth and high quality earnings. This performance is
particularly remarkable when viewed against the backdrop of the challenging
business environment in which it was achieved, namely, a slowdown in economic
growth, sustained high inflation and impact of the steep hike in taxes on
Cigarettes during the year.
Gross Revenue/Income from Operations at Rs 102238.600 Millions grew by
19.9% driven primarily by Branded Packaged Foods, Agri business and Cigarettes.
Profit from Operations grew by 21.8% to Rs 24994.100 Millions while Profit
Before Tax and Net Profit at Rs 26611.000 Millions and Rs.18364.200 Millions
registered a growth of 20.1% and 21.3% respectively. Earnings Per Share for the
quarter stood at Rs 2.34.
FMCG - Branded Packaged Foods | Personal Care Products
Education and
Stationery Products | Cigarettes
Hotels
| Paperboards, Paper
and Packaging
Agri Business
| Contribution to
Sustainable Development
FMCG - Branded Packaged Foods
The business recorded significant growth during the quarter across all
major categories. An enriched sales mix combined with smart commodity sourcing
and supply chain optimisation helped enhance profitability. Sunfeast biscuits
sustained its robust growth trajectory led by a portfolio of differentiated and
innovative products such as Dream Cream, Dark Fantasy Choco Fills. The brand
has emerged as the clear market leader in the highly competitive premium cream
biscuits segment.
Sunfeast Yippee! Noodles and the Bingo! range of savoury snacks
continued to enhance consumer franchise during the quarter, leveraging a highly
innovative product portfolio. The business has built a healthy pipeline of
innovative variants and product formats to further enhance its market standing
in these high growth categories.
Aashirvaad atta further consolidated its leadership position across
markets aided by increasing consumer traction for the value added and premium
offerings viz. 'Select' and 'Multi-grain' variants.
The business continues to invest in disaggregated manufacturing and
distribution infrastructure with a view to optimising supply chain costs and
improving market servicing.
Personal Care Products
The business sustained its impressive growth trajectory during the
quarter with the Soap category garnering significant consumer franchise driven
by the 'Vivel Luxury Creme' and 'Vivel Clear' variants.
Product portfolio was strengthened during the quarter with the launch of
a new variant - ‘Exotic Dream’ transparent gel bar - in select markets under
the Fiama Di Wills brand.
The business rolled out its products in the Skin Care and Shampoo
categories to target markets during the quarter. Consumer response to recent
launches such as 'Vivel Summer Fair', a differentiated summer offering for
fresh and fair skin, has been encouraging.
The business continues to focus on Research & Development to launch
high quality and innovative products. 'Laboratoire Naturel' - the
state-of-the-art consumer and product interaction centre set up by the business
in Bengaluru - is being increasingly leveraged to connect the R&D and brand
teams to the Indian consumer with a view to launching products with unique and
differentiated benefits.
Education and Stationery Products
Classmate notebooks registered an impressive growth during the quarter, further
consolidating its leadership position in the student notebook category.
The business continues to strengthen the Paperkraft brand, its premium
executive and office supplies range. The business has positioned 'Paperkraft'
as the finest green paper for business applications viz. copy-scan-print-fax,
leveraging the Company's world-class fibre line at Bhadrachalam which is
India's first ozone treated elemental chlorine free facility. Paperkraft's
green credentials are supported, among other factors, by the Company's
membership of the prestigious Global Forest & Trade Network, an
international initiative of the WWF (World Wide Fund for Nature).
Cigarettes
The continuing discriminatory taxation and regulatory framework against
cigarettes in India, which account for only 15% of overall tobacco consumption,
is a major cause of concern. The steep increase in the tax rates on cigarettes
over the years, both at the Central and at the State level, has led to the
undesirable consequence of shifting consumption patterns to lightly taxed or
tax evaded tobacco products like Bidi, Khaini, Chewing Tobacco and Gutkha which
constitute 85% of overall tobacco usage in India besides providing a fillip to
illegal cigarette trade.
The sharp increases in Excise duty and VAT on cigarettes during the year
have further exacerbated the problem of discriminatory and high taxation on
cigarettes within the tobacco industry. Consequently, industry volumes have
come under severe pressure.
Despite these challenging conditions, the Company’s cigarettes business,
through its relentless focus on providing differentiated and world-class
products to consumers, sustained its leadership position in the industry. Focus
on innovation and consumer centricity supported by world-class brands, contemporary
packaging formats and state-of-the-art manufacturing facilities and a deep and
wide distribution network have enabled the business to consistently deliver
superior value. During the quarter, several initiatives were launched across
the brand portfolio viz., Classic, Gold Flake, Flake, Navy Cut including pack
modernisation, introduction of new variants and limited edition packs leading
to further enhancement of market standing. The launches in the new filter
segment (cigarette length not exceeding 65 mm) have met with favourable
consumer response and the business is rolling out the products to target
markets.
Hotels
The hospitality sector continued to be adversely impacted by the weak
economic conditions prevailing in key international source markets and India on
the one hand and significant additions to room supplies in key Indian cities on
the other. Consequently, growth in Segment Revenues was muted during the
quarter.
During the quarter, the Company unveiled its latest offering in the
super premium segment - ITC Grand Chola at Chennai. The hotel has achieved the
distinction of being the world’s largest 'Leadership in Energy and
Environmental Design' (LEED) Platinum rated hotel under the New Construction
category bolstering the unique positioning of ITC Hotels as the greenest luxury
hotel chain in the world.
Construction activity of the new luxury properties at Kolkata and at the
Classic Golf Resort near Gurgaon is progressing as per plans.
Paperboards, Paper and Packaging
Segment Revenues grew by 6% during the quarter, aided by improved
realisations and product mix enrichment. Segment Results were, however,
impacted by the steep hike in input prices particularly that of wood. The
business is investing in a state-of-the-art paperboard machine at Bhadrachalam
and new packaging & printing facilities at Haridwar which are expected to
become operational shortly. The business continues to provide strategic
sourcing support to the FMCG businesses enabling product differentiation and
faster speed-to-market.
Agri Business
Segment Revenues recorded a robust growth of 41% during the quarter
aided by wheat exports. Operations at the recently commissioned state-of-the
art green leaf tobacco threshing plant in Mysore were scaled up leading to
enhanced quality and supply chain efficiencies. The business continues to
provide strategic sourcing support to the Company’s Cigarettes and Branded
Packaged Foods business by ensuring high quality supplies at competitive costs.
Contribution to Sustainable Development
The Company’s Social Investments Programme aims to address the
challenges arising out of poverty, environmental degradation and climate change
through a range of activities with the overarching objective of creating sustainable
sources of livelihood for the stakeholders. The footprint of the Company’s
Social Investments Programme has spread to 57 districts in the States of Andhra
Pradesh, Bihar, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Rajasthan,
Tamil Nadu, Uttar Pradesh and West Bengal.
The footprint of the Company’s Social Investments Programme can be
viewed at a glance in the following chart:
|
Intervention
Areas |
Unit of
Measurement |
Cumulative till
date |
|
Total Districts
Covered |
Number |
57 |
|
Social and Farm Forestry |
|
|
|
Sustainable
Agricultural Practices |
Number |
14000 |
|
Sustainable
Livelihoods Initiative |
Number |
|
|
Economic
Empowerment of Women |
Persons |
16978 |
|
Primary Education |
Children (Rs. In
Million) |
0.303 |
|
Health and
Sanitation |
Number |
3612 |
The Board of Directors, at its meeting in Kolkata on 19th October 2012, approved the financial results for the quarter ended 30th September 2012.
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 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.54.91 |
|
|
1 |
Rs.87.38 |
|
Euro |
1 |
Rs.70.23 |
INFORMATION DETAILS
|
Report Prepared
by : |
TPT |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
9 |
|
PAID-UP CAPITAL |
1~10 |
9 |
|
OPERATING SCALE |
1~10 |
9 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
9 |
|
--LIQUIDITY |
1~10 |
9 |
|
--LEVERAGE |
1~10 |
9 |
|
--RESERVES |
1~10 |
9 |
|
--CREDIT LINES |
1~10 |
9 |
|
--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 |
NO |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
81 |
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.