MIRA
INFORM REPORT
|
Report Date : |
25.02.2013 |
IDENTIFICATION DETAILS
|
Name : |
MARICO LIMITED |
|
|
|
|
Registered
Office : |
Rang Sharda Kishanchand Marg, Bandra Reclamation, Bandra (West),
Mumbai – 400050, Maharashtra |
|
|
|
|
Country : |
India |
|
|
|
|
Financials (as
on) : |
31.03.2012 |
|
|
|
|
Date of
Incorporation : |
13.10.1988 |
|
|
|
|
Com. Reg. No.: |
11-049208 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs.614.900 Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
L15140MH1988PLC049208 |
|
|
|
|
Legal Form : |
A Public Limited Liability company. The company’s Shares are Listed on
the Stock Exchanges. |
|
|
|
|
Line of Business
: |
Manufacturer of Consumer Daily Products. |
|
|
|
|
No. of Employees
: |
1080 (Approximately), Group (3066) |
RATING & COMMENTS
|
MIRA’s Rating : |
A (67) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
Maximum Credit Limit : |
USD 44900000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
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|
|
|
Litigation : |
Clear |
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|
|
|
Comments : |
Subject is a well established and reputed company having fine track
record. Financial position of the company appears to be sound. Trade
relations are reported as fair. Business is active. Payments are reported to
be regular and as per commitments. The company can be considered good for normal business dealings at
usual trade terms and conditions. |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – June 30, 2012
|
Country Name |
Previous Rating (31.03.2012) |
Current Rating (30.06.2012) |
|
India |
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
India is developing into an open-market economy, yet traces of
its past autarkic policies remain. Economic liberalization, including
industrial deregulation, privatization of state-owned enterprises, and reduced
controls on foreign trade and investment, began in the early 1990s and has
served to accelerate the country's growth, which has averaged more than 7% per
year since 1997. India's diverse economy encompasses traditional village
farming, modern agriculture, handicrafts, a wide range of modern industries,
and a multitude of services. Slightly more than half of the work force is in
agriculture, but services are the major source of economic growth, accounting
for more than half of India's output, with only one-third of its labor force.
India has capitalized on its large educated English-speaking population to become
a major exporter of information technology services and software workers. In
2010, the Indian economy rebounded robustly from the global financial crisis -
in large part because of strong domestic demand - and growth exceeded 8%
year-on-year in real terms. However, India's economic growth in 2011 slowed
because of persistently high inflation and interest rates and little progress
on economic reforms. High international crude prices have exacerbated the
government's fuel subsidy expenditures contributing to a higher fiscal deficit,
and a worsening current account deficit. Little economic reform took place in
2011 largely due to corruption scandals that have slowed legislative work.
India's medium-term growth outlook is positive due to a young population and
corresponding low dependency ratio, healthy savings and investment rates, and
increasing integration into the global economy. India has many long-term
challenges that it has not yet fully addressed, including widespread poverty,
inadequate physical and social infrastructure, limited non-agricultural
employment opportunities, scarce access to quality basic and higher education,
and accommodating rural-to-urban migration.
|
Source
: CIA |
EXTERNAL AGENCY RATING
|
Rating Agency Name |
CRISIL |
|
Rating |
AA (Long Term Rating) |
|
Rating Explanation |
High degree of safety and very low credit
risk. |
|
Date |
January 16, 2013 |
|
Rating Agency Name |
CRISIL |
|
Rating |
A1+ (Short Term Rating) |
|
Rating Explanation |
Very strong degree of safety and lowest
credit risk. |
|
Date |
January 16, 2013 |
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 : |
Rang Sharda Kishanchand Marg, Bandra Reclamation, Bandra (West),
Mumbai – 400050, Maharashtra, India |
|
Tel. No.: |
91-22-66480480 |
|
Fax No.: |
91-22-66490112/ 0114 |
|
E-Mail : |
|
|
Website : |
|
|
Location : |
Owned |
|
|
|
|
Regional Offices : |
Located At: South Ro: 210-B, Swapanlok Complex, Tel No.: 91-40-27813351/ 55260067 C-10, Dalia Industrial Estate, Modi House, Off. New Link Road, Near
Fun Republic Cinema, Andheri (West), Mumbai – 400058, Maharashtra, India Tel No.: 91-22-26732439-40/ 26732472 Tel No.: 91-33-22470750/ 22477629 North RO : No.5, Tel No.: 91-11-26383370/ 8167/ 8168 |
|
|
|
|
Factories : |
Located At : · Kanjikode · Pondicherry · Jalgaon · Paonta · Dehradun · Goa ·
Baddi |
DIRECTORS
As on: 31.03.2012
|
Name : |
Mr. Harsh Mariwala |
|
Designation : |
Chairman and Managing Director |
|
|
|
|
Name : |
Mr. Nikhil Khattau |
|
Designation : |
Chairman of Audit Committee |
|
|
|
|
Name : |
Mr. Rajeev Bakshi |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Atul Choksey |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Anand Kripalu |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Rajendra Mariwala |
|
Designation : |
Director |
|
|
|
|
Name : |
Ms. Hema Ravichandran |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. B.S. Nagesh |
|
Designation : |
Director |
KEY EXECUTIVES
|
Name : |
Mrs. Hemangi Ghag |
|
Designation : |
Company Secretary |
|
|
|
|
|
Management Team
: |
|
Name : |
Mr. Harsh Mariwal |
|
Designation : |
Chairman and Managing Director |
|
|
|
|
Name : |
Mr. Saugata Gupta |
|
Designation : |
Chief Executive Officer - Consumer Product Business |
|
|
|
|
Name : |
Mr. Ajay Pahwa |
|
Designation : |
Chief Executive Officer – Kaya |
|
|
|
|
Name : |
Mr. Milind Sarwate |
|
Designation : |
Group Chief Financial Officer |
|
|
|
|
Name : |
Mr. Vijay Subramanian |
|
Designation : |
Chief Executive Officer – International Business |
|
|
|
|
|
Audit Committee : |
|
Name : |
Mr. Nikhil Khattu |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Mr. Rajendra Mariwala |
|
Designation : |
Member |
|
|
|
|
Name : |
Ms. Hema Ravichandar |
|
Designation : |
Member |
|
|
|
|
Name : |
Mr. B.S. Nagesh |
|
Designation : |
Member |
|
|
|
|
Name : |
Mr. Harsh Mariwala |
|
Designation : |
Permanent Invitee |
|
|
|
|
Name : |
Mr. Harsh Mariwala |
|
Designation : |
Permanent Invitee |
|
|
|
|
|
Corporate Governance Committee : |
|
Name : |
Ms. Hema Ravichandar |
|
Designation : |
Chairperson |
|
|
|
|
Name : |
Mr. Rajeev Bakshi |
|
Designation : |
Member |
|
|
|
|
Name : |
Mr. Anand Kripalu |
|
Designation : |
Member |
|
|
|
|
Name : |
Mr. Milind Sarwate |
|
Designation : |
Secretary to the Committee |
|
|
|
|
Name : |
Mr. Harsh Mariwala |
|
Designation : |
Permanent Invitee |
|
|
|
|
|
Shareholders Committee : |
|
Name : |
Mr. Nikhil Khattau |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Mr. Rajen Mariwala |
|
Designation : |
Member |
|
|
|
|
Name : |
Mrs. Hemangi Ghag |
|
Designation : |
Secretary to the Committee |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on: 31.03.2012
|
Category of Shareholders |
No. of Shares |
Percentage of
Holding |
|
|
|
|
|
(A) Shareholding
of Promoter and Promoter Group |
|
|
|
(1) Indian |
|
|
|
|
376296520 |
58.37 |
|
|
8822000 |
1.37 |
|
|
385118520 |
59.74 |
|
|
|
|
|
Total shareholding
of Promoter and Promoter Group (A) |
385118520 |
59.74 |
|
(B) Public
Shareholding |
|
|
|
|
|
|
|
|
9772180 |
1.52 |
|
|
10500 |
0.00 |
|
|
4776346 |
0.74 |
|
|
177748924 |
27.57 |
|
|
22058823 |
3.42 |
|
|
214366773 |
33.25 |
|
|
|
|
|
|
19748690 |
3.06 |
|
|
|
|
|
|
19572576 |
3.04 |
|
|
3806312 |
0.59 |
|
|
2094728 |
0.32 |
|
|
295446 |
0.05 |
|
|
1719282 |
0.27 |
|
|
80000 |
0.01 |
|
|
45222306 |
7.01 |
|
Total Public
shareholding (B) |
259589079 |
40.26 |
|
Total (A)+(B) |
644707599 |
100.00 |
|
(C) Shares held by Custodians and against which Depository Receipts have been issued |
0 |
0.00 |
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
Total (A)+(B)+(C) |
644707599 |
0.00 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer of Consumer Daily Products. |
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|
Products : |
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GENERAL INFORMATION
|
No. of Employees : |
1080 (Approximately), Group (3066) |
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Bankers : |
· Axis Bank Limited · Barclays Bank PLC · Citibank N.A · HDFC Bank Limited · ICICI Bank Limited · Kotak Mahindra Bank Limited · Standard Chartered Bank · State Bank of India · HSBC Limited · DBS Bank Limited · JP Morgan Chase Bank N.A. · Royal Bank of Scotland N.V. · Corporation Limited |
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Facilities : |
(Rs.
In Millions)
|
||||||||||||||||||||||||||||||||
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|
|
|
Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
Price Waterhouse Chartered Accountant |
|
|
|
|
Internal Auditors : |
|
|
Name 1 : |
Aneja Associates (Upto March 31, 2012) Chartered Accountants |
|
|
|
|
Name 2 : |
Ernst and Young (w.e.f. April 1, 2012) Chartered Accountants |
|
|
|
|
|
|
|
Subsidiary Firm : |
Wind Company. (Through MEL Consumer Care SAE) |
|
|
|
|
Others - Entities in
which KMP has significant influence : |
· The Bombay Oil Private Limited · Marico Innovation Foundation Trust |
|
|
|
|
Subsidiary
Companies : |
· Kaya Limited · Marico Bangladesh Limited (MBL) · MBL Industries Limited (MBLIL) (Through Marico Middle East FZE) · Marico Middle East FZE (MME) · Kaya Middle East FZE (KME) (Through Marico Middle East FZE) · MEL Consumer Care SAE (MELCC) (Through Marico Middle East FZE) · Egyptian American Investment and Industrial Development Company (EAIIDC) (Through Marico Middle East FZE ) · Marico Egypt Industries Company (MEIC) (through MEL Consumer Care SAE) · Marico South Africa Consumer Care (Pty) Limited (MSACC) · Marico South Africa (Pty) Limited (MSA) (Through Marico South Africa Consumer Care (Pty) Limited) · CPF International (Pty) Limited (CPF) (Through Marico South Africa (Pty) Limited) (upto January 16, 2012) · Marico Malaysia Sdn. Bhd. (MMSD) (Through Marico Middle East FZE) · Derma – Rx International Aesthetics Pte. Limited. (DIAL) (w.e.f May 22, 2010) · The DRx Clinic Pte. Limited s(DCPL) (Through Derma – Rx International Aesthetics Pte. Limited ) (w.e.f May 25, 2010) · The DRx Medispa Pte. Limited (DMSPL) (Through Derma – Rx International Aesthetics Pte. Limited) (w.e.f May 25, 2010) · DRx Investments Pte. Limited. (DIPL) (Through Derma – Rx International Aesthetics Pte. Limited ) (w.e.f May 25, 2010) · DRX Meditech Pte Limited – (With effect from May 25, 2010 and upto February 28, 2011 – merged with Derma- Rx International Aesthetics Pte Limited with effect from March 1, 2011) · DRx Aesthetics Sdn. Bhd. (DASB) (Through Derma – Rx International Aesthetics Pte. Limited ) (w.e.f May 25, 2010) · International Consumer Products Corporation (ICP) (w.e.f February 18, 2011) · Beaute Cosmetique Societe Par Actions (BCS) (Through International Consumer Products Corporation) (w.e.f February 18, 2011) (99% (99%) equity held by ICP) · Thuan Phat Foodstuff Joint Stock company (TPF) (Through International Consumer Products Corporation) (w.e.f February 18, 2011) (98.6% (87%) equity held by ICP) |
CAPITAL STRUCTURE
As on: 31.03.2012
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
650000000 |
Equity Shares |
Rs.1/- each |
Rs.650.000 Millions |
|
150000000 |
Preference Shares |
Rs.10/- each |
Rs.1500.000 Millions |
|
|
|
|
|
|
|
Total |
|
Rs.2150.000
Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
614934387 |
Equity Shares |
Rs.1/- each |
Rs.614.900 Millions |
|
|
|
|
|
a) Reconciliation of
number of shares
|
|
As at March 31, 2012 |
|
|
Particulars |
Number of shares |
Rs. In Millions |
|
Balance as at the beginning of the year |
614399550 |
614.400 |
|
Shares Issued during the year |
534837 |
0.500 |
|
|
|
|
|
Balance as at the
end of the year |
614934387 |
614.900 |
b) Rights,
preferences and restrictions attached to shares:
Equity Shares: The Company has one class of equity shares having a par value of Re.1 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.
c) Details of shares
held by shareholders holding more than 5% of the aggregate shares in the
Company
|
|
As at March 31, 2012 |
|
|
Name of Shareholder |
No. of Shares held |
% of Holding |
|
Equity Shares of
Re. 1/- each fully paid-up |
|
|
|
Harsh C Mariwala (As a representative of Valentine Family Trust) |
73376000 |
11.93 |
|
Harsh C Mariwala (As a representative of Aquarius Family Trust) |
73376000 |
11.93 |
|
Harsh C Mariwala (As a representative of Taurus Family Trust) |
73376000 |
11.93 |
|
Harsh C Mariwala (As a representative of Gemini Family Trust) |
73376000 |
11.93 |
|
Arisaig Partners (Asia) Pte Limited |
35353269 |
5.75 |
|
Oppenheimer Developing Markets Fund (Royal Bank of Scotland) |
30906283 |
5.03 |
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 |
614.900 |
614.400 |
609.300 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
10626.300 |
8116.800 |
5107.300 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
11241.200 |
8731.200 |
5716.600 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
3105.300 |
3324.200 |
996.100 |
|
|
2] Unsecured Loans |
2426.200 |
2200.700 |
2773.100 |
|
|
TOTAL BORROWING |
5531.500 |
5524.900 |
3769.200 |
|
|
DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
16772.700 |
14256.100 |
9485.800 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
2400.900 |
2224.600 |
1299.700 |
|
|
Capital work-in-progress |
362.200 |
455.200 |
1099.500 |
|
|
Assets held for disposal |
0.000 |
1.800 |
0.100 |
|
|
|
|
|
|
|
|
INVESTMENT |
6721.700 |
4703.600 |
2091.100 |
|
|
DEFERREX TAX ASSETS |
190.800 |
265.400 |
585.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
5300.400
|
4542.200
|
3699.000
|
|
|
Sundry Debtors |
1010.400
|
1189.800
|
945.100
|
|
|
Cash & Bank Balances |
322.600
|
181.700
|
112.100
|
|
|
Other Current Assets |
163.500
|
0.000
|
0.000
|
|
|
Other Non Current Assets |
1231.400
|
0.000
|
0.000
|
|
|
Loans & Advances |
2902.700
|
3295.700
|
2541.700
|
|
Total
Current Assets |
10931.000
|
9209.400
|
7297.900
|
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
2444.700
|
2025.200
|
2106.600
|
|
|
Other Current Liabilities |
857.200
|
258.800
|
158.500
|
|
|
Provisions |
532.000
|
319.600
|
622.400
|
|
Total
Current Liabilities |
3833.900
|
2603.900
|
2887.500
|
|
|
Net Current Assets |
7097.100
|
6605.500
|
4410.400
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
16772.700 |
14256.100 |
9485.800 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
|
|
31.03.2012 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
|
|
29703.000 |
|
|
|
Other Income |
|
|
516.500 |
|
|
|
TOTAL (A) |
|
|
30219.500 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of materials consumed |
|
|
16719.200 |
|
|
|
Purchases of stock-in-trade |
|
|
1063.300 |
|
|
|
Changes in inventories of finished goods, work-in-progress and stock-in-trade - (Increase) / decrease |
|
|
(400.200) |
|
|
|
Employee benefits expenses |
|
|
1262.100 |
|
|
|
Other expenses |
|
|
6984.000 |
|
|
|
TOTAL (B) |
|
|
25628.400 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
|
|
4591.100 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
|
|
283.400 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
|
|
4307.700 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
|
|
314.900 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
|
|
3992.800 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
|
|
626.900 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
|
|
3365.900 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
|
|
6025.000 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
|
|
337.000 |
|
|
|
Debenture Redemption Reserve |
|
|
200.000 |
|
|
|
Dividend |
|
|
430.000 |
|
|
|
Tax on Dividend |
|
|
70.000 |
|
|
BALANCE CARRIED
TO THE B/S |
|
|
8354.000 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
FOB value of exports |
|
|
1923.500 |
|
|
|
Royalty |
|
|
76.200 |
|
|
|
Dividend |
|
|
198.900 |
|
|
|
Interest |
|
|
40.900 |
|
|
|
Corporate guarantee income |
|
|
7.700 |
|
|
TOTAL EARNINGS |
|
|
2247.200 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw materials |
|
|
1318.900 |
|
|
|
Packing materials |
|
|
22.000 |
|
|
|
Capital goods |
|
|
11.700 |
|
|
|
Stock - in - trade (Traded goods) |
|
|
10.900 |
|
|
TOTAL IMPORTS |
|
|
1363.500 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
|
|
5.48 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
|
31.03.2011 |
31.03.2010 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
|
23468.700 |
20242.900 |
|
|
|
Income from Services |
|
0.000 |
0.000 |
|
|
|
Other Income |
|
251.700 |
220.600 |
|
|
|
TOTAL |
|
23720.400 |
20463.500 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of Materials |
|
13643.000 |
10851.000 |
|
|
|
Manufacturing and Other Expenses |
|
6411.200 |
6251.700 |
|
|
|
TOTAL |
|
20054.200 |
17102.700 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION |
|
3666.200 |
3360.800 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL EXPENSES |
|
299.200 |
183.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION |
|
3367.000 |
3177.800 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION |
|
276.300 |
252.100 |
|
|
|
|
|
|
|
|
|
Add |
EXCEPTIONAL
ITEMS |
|
(654.700) |
0.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX |
|
3745.400 |
2925.700 |
|
|
|
|
|
|
|
|
|
Less |
TAX |
|
592.200 |
575.500 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX |
|
3153.200 |
2350.200 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
|
3825.800 |
2331.000 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
|
315.300 |
235.000 |
|
|
|
Debenture Redemption Reserve |
|
166.700 |
150.000 |
|
|
|
Interim Dividend |
|
66.400 |
402.100 |
|
|
|
Tax on Interim Dividend |
|
405.400 |
68.300 |
|
|
BALANCE CARRIED
TO THE B/S |
|
953.800 |
3825.800 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
F.O.B. Value |
|
1391.600 |
1306.400 |
|
|
|
Royalty |
|
68.400 |
65.600 |
|
|
|
Dividend |
|
44.800 |
46.900 |
|
|
|
Interest |
|
40.300 |
44.100 |
|
|
TOTAL EARNINGS |
|
1545.100 |
1463.000 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
|
328.000 |
844.500 |
|
|
|
Packing Material |
|
27.000 |
64.200 |
|
|
|
Capital Goods |
|
1.600 |
5.000 |
|
|
|
Finished Goods for Resale |
|
18.800 |
32.000 |
|
|
TOTAL IMPORTS |
|
375.400 |
945.700 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) (Basic) |
|
5.13 |
3.86 |
|
|
|
Earnings Per
Share (Rs.) (Diluted) |
|
5.13 |
3.84 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2012 |
30.09.2012 |
31.12.2012 |
|
|
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
|
Net Sales |
9746.100 |
8296.300 |
8705.100 |
|
Total Expenditure |
8007.500 |
7203.400 |
7387.600 |
|
PBIDT (Excl OI) |
1738.600 |
1093.000 |
1317.500 |
|
Other Income |
143.300 |
29.600 |
253.300 |
|
Operating Profit |
1882.000 |
1122.500 |
1570.800 |
|
Interest |
133.600 |
107.100 |
105.500 |
|
Exceptional Items |
0.000 |
0.000 |
0.000 |
|
PBDT |
1748.400 |
1015.500 |
1465.400 |
|
Depreciation |
77.100 |
83.000 |
96.500 |
|
Profit Before Tax |
1671.400 |
932.400 |
1368.900 |
|
Tax |
337.800 |
182.900 |
267.200 |
|
Provisions and contingencies |
0.000 |
0.000 |
0.000 |
|
Profit After Tax |
1333.600 |
749.600 |
1101.700 |
|
Extraordinary Items |
0.000 |
0.000 |
0.000 |
|
Prior Period Expenses |
0.000 |
0.000 |
0.000 |
|
Other Adjustments |
0.000 |
0.000 |
0.000 |
|
Net Profit |
1333.600 |
749.600 |
1101.700 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
PAT / Total Income |
(%) |
11.14 |
15.78 |
11.48
|
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
13.44 |
15.95 |
14.45
|
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
29.94 |
32.75 |
34.03
|
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.36 |
0.42 |
0.51
|
|
|
|
|
|
|
|
Debt Equity Ratio (Total Debt/Networth) |
|
0.49 |
0.63 |
0.66
|
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
2.85 |
3.53 |
2.53
|
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 |
Yes |
|
31] |
Date of Birth of Proprietor/Partner/Director, if available |
No |
|
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 |
UNSECURED LOAN
(Rs.
In Millions)
|
Particular |
As on 31.03.2012 |
|
Debentures 500, 10.05%, Rated Taxable Unsecured Redeemable Non-convertible debentures of face value of Rs. 1.000 Million each |
500.000 |
|
From banks |
|
|
Buyers’ credit |
1112.200 |
|
Pre-shipment credit in foreign currency |
305.200 |
|
Other term loans |
508.800 |
|
|
|
|
Total |
2426.200 |
Notes:
1.
The above debentures were issued on March 30,
2011 and are reedeemable at par after 30 months from the date of issue i.e. by
September 30, 2013. Interest on these debentures is payable at an interval of
12 months. The debentures are listed on National Stock
Exchange.
2. Buyers credit arrangements are loans taken in foreign currency for a term of twelve months and carry interest rate of LIBOR plus applicable spread ranging from 0.05% to 1.5% per annum.
3. Pre-shipment credit in foreign currency arrangements are for a term of six months and carry interest rate of LIBOR plus applicable spread ranging from 1.30% to 2% per annum.
4. Other term loans availed in the current year are in foreign currency for a term of 12 months and carries interest rate of 3 months LIBOR + spread of 2.3% per annum. (previous year amount borrowed in Indian Rupees carried interest rate of 8% per annum).
5.
Commercial papers were borrowed for a term of 12
months and carried interest rate ranging from 7% to 10% per annum.
UNSECURED LOAN
(Rs.
In Millions)
|
Particular |
31.03.2011 |
|
From banks : |
|
|
Short term |
770.800 |
|
Other term loans |
950.000 |
|
Inter corporate deposits (Short term) |
20.100 |
|
Commercial Papers
(Redeemable within a year) |
|
|
Face Value |
950.000 |
|
Less : Deferred Interest |
20.100 |
|
|
929.900 |
|
|
|
|
Total |
2200.700 |
REVIEW OF OPERATIONS
The Group continued to focus on expanding its consumer franchise. During FY12 Marico registered revenue from operations of Rs.40080.000 Millions, a growth of 28% over the previous year. This was contributed by 17% expansion in volumes (includes 6% inorganic growth) accompanied by 11% through price increases and sales mix. The top line increase was accompanied by a bottom-line growth of 11%. Profit After Tax (PAT) including exceptional / extra-ordinary items during the year was at Rs.3170.000 Millions as against Rs. 2860.000 Millions in FY11. The growth in profits does not mirror the growth in top line due to inflationary pressures faced by the Company during the year. The Company consciously decided to absorb a part of the increase in input costs in order to maintain and grow its long term consumer franchise. Further, the financial statements of FY12 and FY11 include certain exceptional items. The growth in PAT after excluding the impact of such exceptional items is a healthy 25%.
During the year, Marico extended its record of year on year quarterly growth.
The company has demonstrated steady growth on both the top line and the bottom line. Over the last 5 years, they have grown at a Compounded Annual Growth Rate of 21% and 23% respectively.
Consumer Products
Business: India
The Consumer Products Business in India (CPB) achieved a turnover of Rs.27660.000 Millions during FY12, a growth of about 37% over FY11 (excluding turnover from Sweekar which was divested in March 2011 from the base. If sales of Sweekar were to be included in the base the growth would be 26%). The turnover growth reflected healthy demand and continued business momentum manifest in a volume growth of about 14% over FY11.
Parachute, Marico’s flagship brand, continued to expand its franchise during the year. Parachute coconut oil in rigid packs, the focus part of its portfolio, grew by 11% in volume as compared to FY11. Small packs helped in driving this volume growth. Also, owing to the inflationary environment in the key input prices of coconut oil the competitive environment (specially the local/regional players) during the last few quarters has been soft thereby resulting in Marico’s brands gaining market share. Its share during the 12 months ended March ’12 was 55%.
Marico offers its consumers a basket of value added hair oils for their pre-wash and post wash hair conditioning, nourishment and grooming needs (Key brands being Parachute Advansed hair oil, Parachute Advansed Cooling oil, Parachute Jasmine non sticky hair oil, Parachute Advansed Ayurvedic Hair Oil, Nihar Naturals perfumed hair oil, Hair and Care nourishing non sticky hair oil, and Nihar Shanti Badam Amla hair oil). During the year, Marico’s hair oil brands recorded healthy growth and the portfolio as
a whole grew by about 24% in volume terms over FY11.
Marico’s premium refi ned edible oils brand Saffola grew by about 11% in volume terms compared to FY11. The brand’s strong heart health equity is now being leveraged through functional food extensions in breakfast cereal and low glycemic index rice.
Marico has been constantly investing in a healthy pipeline of new products. During the year the Company launched savory oats under Saffola and Body Lotion under Parachute Advansed.
International FMCG
Business
From a single digit share in FY05, about 24% of the group’s turnover is now contributed by Marico’s International FMCG business. Its key geographical presence is in Bangladesh, MENA (Middle East and North Africa), South Africa and South East Asia.
During FY12, the company’s international business recorded a turnover growth of 30% over FY11. During the year, the Company also successfully integrated the 85% acquisition of International Consumer Products (ICP) in Vietnam.
Marico has entered new geographies as well as scaled up presence in Nepal/Bhutan, Malaysia and Myanmar. During the year, the Company has used the connect and develop model of faster innovation to launch an exciting new range of water gels, Ice gels and Rave Gels, Wax and Clay under Code 10 within six months of opportunity identification. They have also started using ICP as a sourcing base for the Malaysian market.
Myanmar tripled its base in FY12 with both the Nourishment (Parachute Advansed) and Male grooming (Code 10) business showing good traction. In the process they have gained significant market share. The Group expects to scale up this business signif cantly in the coming year(s).
Kaya
Kaya offers its technology led cosmetic dermatological services through 107 clinics: 82 in India across 26 cities and 19 in the Middle East, 2 in Dhaka and 4 clinics through Derma Rx in Singapore and Malaysia.
During FY12, Kaya’s skin solutions business achieved a turnover of Rs. 2790.000 Millions, recording a revenue growth of ~33% over FY11. On an overall basis Kaya made a loss of Rs. 291.000 Millions at PBIT level. During the year Kaya initiated a change in its positioning from ‘cure’ to ‘cure + care’. The new services introduced to take care of regular skin care needs received good traction. The focus on increasing revenue from products, led by introducing products from the Derma Rx range into the clinics in India has resulted in the contribution from the sales of products increasing from 13% to about 23%. These initiatives also helped Kaya business in India and Middle East to achieve the same clinic growth of 15%. Sustaining same store growth would reinforce Marico’s belief in the Kaya Business model, especially as they perceive a signifi cant long term opportunity in skin care solutions.
MANAGEMENT DISCUSSION
AND ANALYSIS
INDUSTRY STRUCTURE, OPPORTUNITIES AND THREATS
The year 2011-12 has been a year of consumption, with both the Central government sponsored schemes and the impact of the Sixth Pay Revision pumping in large amounts of money in the hands of the consumers. Asset price inflation (largely land and gold), drove an increased sense of affluence amongst the masses. Hike in Minimum Support Price for food grains and continued support under NREGS, among other factors, have driven rural incomes and demand. Despite several domestic headwinds including high inflation and interest rates, trade deficit and delay in policy implementation, Fast Moving Consumer Goods (FMCG) continued to show robust growth.
The Indian FMCG market size is in excess of USD 33.4 billion and has grown at ~17% in the last 5 years. It is poised to grow 3.6 times between 2010 and 2020, faster than most other emerging markets. Rising household income, urbanization, increasing literacy, decline in the traditional joint-family structure and changing demographics are key contributors to growth. The most notable force is average household income, which is set to rise nearly 3 times between 2010 and 2020. An indication of this is the per capita income which grew by 14% in FY12 to cross the sixty thousand mark. India’s income pyramid has typically had a wide base and increasingly smaller layers as income rises. This pyramid is quickly becoming a diamond, as per capita income grows.
In an increasingly globalized economy, India’s lion’s share comes from services. This requires skilled labour, which is driving the educated population from small towns and villages into the top towns and cities of the country. This is leading to rapid urbanization and expansion of the large cities (primarily because of poor infrastructure in the small towns), which will potentially lead to an inflection in a decade or two, at which point the urban population will become a sizeable portion of the total.
By
2020, 35% of India’s population will live in cities. As people move from rural
areas to cities, they tend to both increase their purchases as well as spend on
different items. Urban dwellers have better access to goods and are exposed to
greater consumerism. Apart from the change in the population mix, the urban
income distribution has also favorably changed over a period of time. The upper
class in the urban income group has increased by about 36% as compared to 7% in
1996. The rise in urban population coupled with improvement in the urban income mix is favorable for the FMCG industry. Apart from
the better value growth in the urban market, it provides an opportunity to
launch innovative premium products.
Women in urban India are also changing in their quest to break from their traditional image in society. They are increasingly assertive and feeling more secure to venture out to the stores and buy things on their own. A growing number of high-profile women desire the best and are creating a niche market for themselves. A widespread feeling of self-indulgence, which is leading to self-pampering in the form of beauty services and vacations, is emerging. These women are often the biggest potential buyers of niche high-quality, high-end products.
Modernization has led to changing aspirations where the need to be good looking, well-groomed and stylish has taken on a newfound importance. Indian men are also becoming conscious about their appearance, creating a market for male grooming products. Today’s men are less inhibited when it comes to looking good and do indulge in image enhancing products and treatments. The categories witnessing significant growth include men’s face creams, hair gels and deodorants.
A part of the trend to look fitter and well groomed is the increasing emphasis on a healthy lifestyle. With increasing income, Indians are becoming health conscious leading to a change in lifestyle. Food is the largest consumption category, accounting for 31% of what India spends on today. With growing awareness, product acceptance among the masses has also increased. The market for products that reduce stress, prevent aging, help the heart and fight diabetes are all on a growth curve. The health food market stood at Rs. 90000.000 Millions in 2010, and is expected to grow at a CAGR of 20% to Rs. 225000.000 Millions by 2015. The health food contribution in packaged food, i.e. 10% in India, is on the lower side when compared to the global average of 25-30%. With more companies focusing on products with a strong health and wellness quotient, the consumer awareness about healthier options of food consumption will increase.
Another significant emerging segment of the market is the rural sector, which currently accounts for 70% of India’s population. The rural market is being driven by growth in non-agriculture income, better MSP (Minimum Support Prices) rates, higher education, wealth effect coming from increasing land values, better infrastructure, increasing media penetration and the Government’s emphasis on rural development programmes. With a huge population base, improvement in rural income has opened several gates for the industry.
In the last 5 years, rural India has outperformed the overall FMCG growth. About 50% of the rural population will come under the INR 90k-200k annual income range by 2015, as against ~35% in 2005. This rise in annual income is expected to favorably improve the lower middle class and middle class mix in future. This brings new consumers within the fold, while existing consumers move up the value chain. Also, penetration levels across categories are lower in rural areas compared to urban, which provide strong headroom for growth. This will help the industry maintain volume growth for a long period.
Rising consumption and increasing proportion of younger population where 70% of Indians will be of working age in 2025, increasing media penetration and rising aspiration will further drive FMCG growth. India’s organized retail is estimated at USD 28 billion with around 7% penetration but is expected to grow to 21% and become a USD 260 billion business over the next decade. Modern retail offers opportunities to experiment with new categories. It also gives customers a chance to educate themselves about new products which is not the case with a general trade store. Category creation and market development starts with modern trade but as more consumers start consuming this category, they penetrate into other channels. Organized retail has fuelled new growth categories - liquid hand wash, breakfast cereals, ready-to-eat foods, pre-and post-wash products and hair conditioners account for almost 50% of their sales. However, a significant share of FMCG business is still generated through the ‘mom and pop’ store (kirana) format. With better infrastructure aiding access to the rural economy, it is likely that ‘mom and pop’ stores will remain the chief point of interface for the FMCG companies.
India Incorporated is looking to grow inorganically. It is important to go global not only to create multiple growth engines but also to create reverse learning for the home market. The year gone by has seen a number of overseas acquisitions made by Indian FMCG companies. Also, the emerging economies in Asia and Africa have low-to-medium penetrations in some of the FMCG categories. This signifies considerable headroom for growth in the mid-term. Favorable macros, changing attitudes of the consumers and progressive policies of the governments also make these markets attractive destinations. Typically, gestation periods tend to be longer as one needs to go up the learning curve in a new market. Some of them also offer inorganic entry possibilities that can create access to mainstream distribution, manufacturing and talent. This can speed up one’s learning curve as long as there is a strategic fit with the target.
Overall, a study of India’s private spending data reveals some fundamental shifts. Hence businesses across different consumer goods need to carry out a fresh assessment of the near term prospects of the Indian economy and the changes in consumer spending behavior. The FMCG sector is likely to benefit from these changes and will also get an opportunity to innovate with new products and categories while looking at extending its learnings to other emerging markets.
OUTLOOK
Marico has positioned itself, strategically, in emerging markets - India, South Africa (part of BRICSA), Bangladesh, Vietnam and Egypt (Part of N-11 Group) and the Middle East. In emerging markets, a focus on the long term is crucial. Long term success can be ensured only through stronger brands that enjoy loyal consumer franchises. Marico has therefore chosen to prioritize expansion of consumer franchise over expansion of margins.
In the immediate term, however, there exists some uncertainty in the business environment. While the pressure of inflation has eased to some extent in India, the GDP growth estimates have been revised downwards. Even though FMCG companies marketing items of daily consumption are not affected as much as some other industries might be, there could be an effect on consumer demand especially for items of discretionary consumption in their portfolio. In addition, high inflation and weak currencies may have some impact on business in a few of Marico’s international markets.
Here is a broad outline of Marico’s strategies and the expected outcome for its various businesses:
CONTINGENT
LIABILITIES:
(Rs. In Millions)
|
Particular |
31.03.2012 |
31.03.2011 |
|
Disputed tax demands / claims : |
|
|
|
Sales tax |
133.200 |
172.400 |
|
Income tax |
41.400 |
-- |
|
Customs duty |
4.000 |
4.000 |
|
Agricultural produce marketing cess |
88.400 |
81.400 |
|
Employees state insurance corporation |
1.300 |
1.300 |
|
Excise duty on subcontractors |
3.500 |
2.900 |
|
Excise duty on CNO dispatches |
2789.200 |
2107.400 |
|
Claims against the Company not acknowledged as debts. |
2.800 |
2.700 |
|
Possible indemnification obligations under the Deed of Assignment for assignment of “Sweekar” brand. |
-- |
40.000 |
FIXED ASSETS:
Tangible Assets
· Freehold Land
· Leasehold Land
· Buildings
· Plant and Equipments
· Furniture and Fixtures
· Vehicles
· Office Equipments
Intangible Assets
· Trademarks and Copyrights
· Computer Software
AS PER WEBSITE DETAILS:
Press Release
MARICO GAINS ON
DEMERGER PLANS, ANALYSTS SAY BUY
Tuesday, January 08,
2013 at 10:22
Marico shares surged over 5 percent to a 52-week high of Rs 238.50 on Tuesday morning, as the street gave a thumbs up to its demerger plans and several analysts advised investors should "buy" the stock.
Marico
shares surged over 5 percent to a 52-week high of Rs 238.50 on Tuesday
morning, as the street gave a thumbs up to its demerger plans and several
analysts advised investors should "buy" the stock.
Marico's board on Monday approved plans to
demerge its Kaya Skin Care Solutions business and list it separately as Marico
Kaya Enterprises Limited.
Marico's Consumer Products Business (CPB) and
International Business Group (IBG) will now form a unified FMCG business, post
the restructuring.
Antique Stock Broking upgraded the stock to
"buy" from "hold," saying the demerger was positive for Marico
as it would make it a pure consumer play.
"The separation of Kaya Skin care would
mean an improvement in return ratios of Marico's pure FMCG business which will
now house only the consumer businesses attracting higher profitability and
returns. From an estimated RoCE of 21% in FY14, Marico's RoCE would increase to
an estimated 23% during the year. Therefore, the separation will not have any
impact on the earnings capacity of Marico, however would make its balance sheet
size lighter by about 12% (Rs 350 crore)," Antique analysts Abhijeet Kundu
and Nupur Parik said.
Analysts say the demerger will also benefit
Kaya, which has seen earnings improve this financial year and posted a pre-tax
profit in the second quarter. It will be able to attract funds for expansion,
they say.
"The demerger of Kaya into a separate
entity could potentially lead to better capital utilisation for its
expansion," Goldman Sachs said, putting a "buy" rating on the
stock.
"Demerger of Kaya into a separate listed
entity will lead to price discovery of the business, in our view. We estimated
Kaya to report sales of Rs 410 crore and breakeven at the profit after tax
level in FY2014," said Amrita Basu and Rohit Chordia of Kotak
Institutional Equities.
At 10:15 hrs, Marico shares were up 4 percent
at Rs 236.45 on NSE.
Marico Q3FY13 results
Stronger market shares, Margin expansion Revenue up 11%, PAT up 21%
Marico posted Revenue from Operations of Rs. 11680.000 Millions (USD 216
million) a growth of about 11% over Q3FY12. The growth was largely led by about
9% volume growth as compared to Q3FY12. The inflation component in the overall
growth was lower at 2%.
The growth in Profits after Tax (PAT) was about 21%. If one excludes the
impact of one time and non comparable items in the Q3FY12 results then the
growth in PAT is about 12%. The Profit Before tax (PBT) before considering the
impact of non comparable and one time items grew by 20%.
The gross margins expanded by 420 bps. The Company chose to invest part
of this expansion in brand building leading to an operating margin expansion of
100 bps. This reflects the Company’s approach towards focusing on new consumer
acquisition across its portfolios as against maximizing margins in the short
term.
The Indian FMCG Business grew at 16% in value terms and by 15% in volume
terms during Q3FY13 over Q3FY12. The International FMCG business reported a
flat performance during Q3FY13 and Kaya skincare solutions business posted a
top line growth of 5%.
Market shares continued to be healthy across
categories.
Marico (BSE: 531642, NSE: “MARICO”) is one of India’s leading Consumer Products and Services Group, in the global beauty and wellness space. During 2011-12, Marico recorded a turnover of about Rs. 40.0 billion (USD 740 Million) through its products and services sold in India and about 25 other countries in Asia and Africa.
Marico touches the lives of 1 out of every 3 Indians, through its portfolio of brands such as Parachute, Parachute Advansed, Saffola, Hair and Care, Nihar, Livon, Setwet, Zatak, Mediker and Revive. The international consumer products portfolio contributes to about 24% of the Group’s revenue, with brands like Parachute, Hair Code, Fiancée, Caivil, Hercules, Black Chic, Code 10, Ingwe, X-Men, L’Ovite and Thuan Phat.
Marico’s focus on sustainable profitable growth is manifest through its consistent financial performance, a CAGR of 21% in Turnover and 23% in Profits over the past 5 years.
The Consumer Products Business in India (CPB) achieved a turnover of Rs.
8280.000 Millions (USD 153 million), a growth of about 16% over Q3FY12. The
turnover of acquired Youth brands (including Set Wet, Zatak and Livon) amounted
to Rs. 430.000 Millions (USD 8 million) during the quarter. The growth before
considering the turnover of these brands was 10%.
The organic domestic volume growth was about 9% which is still healthy
in the context of more prominent signs of slow down in certain categories. A
deceleration in the rate of new customer acquisition owing to an expansion in
the premium charged by the Company on its products and slow down in certain
discretionary segments impacted the overall growth. The business recorded
market share gains across the portfolio.
Marico participates in the Rs. 25000.000 Millions (USD 463 million)
branded coconut oil market through Parachute and Nihar. The rigid part (packs
in blue bottles) of the portfolio of Parachute, Marico’s flagship brand,
recorded a volume growth of about 6% during the quarter over Q3FY12. The Company
has been focusing on the rigid packs over the past few years as they enjoy a
higher margin as compared to pouch packs. During the 12 month period ending
December 2012 Parachute along with Nihar improved its market share by about 390
bps over the same period last year to 57.8%
The Saffola refined edible oils franchise grew by about 4% in volume
terms during Q3FY13 compared to Q3FY12. The growth during the current quarter
however was lower than the recent trend as anticipated. The inflation in the
safflower oil and rice bran oil is significantly higher than the inflation in
sunflower oil. This has led to expansion in premium of Saffola vis-ŕ-vis the
other refined edible oils. The Company has initiated some pricing action (in
the form of promotional offers and price reduction) in select packs in order to
bring the premium back to sustainable levels. The Company expects to return to
double digit growth in the coming quarter. Saffola has a market share of 58% in
the super premium refined edible oils category. Its communication campaigns won
several awards including the prestigious Grand Emvie 2102.
Saffola oats, including its savory variants, are now available on a
national basis. Saffola now offers a bouquet of six flavors in the savory Oats
category. Saffola has an exit market share of about 13% to 14% by volume in the
Oats category and has emerged as the number two player. Besides offering oats
Saffola strengthened its position in the breakfast category by introducing
Muesli on a national basis. The product is available in three variants. The
market size of Muesli is estimatedto be around Rs. 800.000 Millions to Rs.
1000.000 Millions (USD 14.8 million to USD 18.5 million) growing rapidly in
excess of 40%. Saffola Muesli has already becomea number 3 player with an exit
market share of about 9%.
In Value Added Hair Oils, Marico has a “category play” in the segment whereby it offers its consumers a basket of value added hair oils for their pre-wash and post wash leave-in hair conditioning, nourishment and grooming needs in the approximately Rs. 40000.000 Millions (USD 740 million) market. The portfolio grew by about 30% in volumes over Q3FY12. The Company is now focusing on scaling up its presence in all the sub segments of Value Added Hair Oils.
Parachute Advansed Body Lotion has achieved a volume market share of about 6% to 7% (moving 12 months basis) within a short period of time and has become the number 3 participant in the market. The brand’s clutter-breaking premium packaging won the World Star 2012 award beating stiff competition from across several countries. The brand gained about 230 bps in market share during the current season as compared to the last season.
The turnover achieved from the Youth brands (Set Wet, Zatak and Livon) during the quarter was Rs. 430.000 Millions (Rs. 80.000 million), a growth of 18% over Q3FY12. The Company has achieved a portfolio top line of RS. 100 Cr (USD 18 million) on a year to date basis clocking a YTD growth of about 21%.
Saugata Gupta, CEO, Consumer Products Businessexpressed happiness at the results: “We have delivered a healthy topline growth accompanied by an expansion in margin. Our continued investments in our brands are expected to results by way of volume growths in established brands and scaling our new product initiatives successfully”
Marico’s International Business Group (IBG) focused largely on Bangladesh, MENA (Middle East and North Africa), South Africa and South East Asia comprising about 24% of the Marico Group’s turnover inFY12, achieved a turnover of Rs. 2610.000 Millions (USD 48 million) during Q3FY13. Faced with a challenging environment in key geographies IBG had a flat topline performance as compared to Q3FY12.
Bangladesh lost valuable business days owing to “strikes” in the country. Bangladesh Parachute Coconut Oil and Hair Code hair dye held their respective market shares and leadership positions in the respective categories. In the Value Added Hair Oils (VAHO) space, the Company strengthened its presence through increased volumes of Parachute Beliphool, a light hair oil with a floral fragrance, Parachute Advansed Cooling Oil and Nihar. This has resulted in ramping up market share from about 7% a few quarters back to market share of about 18%.
Overall the environment in Egypt remains somewhat unpredictable. Notwithstanding this, the Company’s business in Egypt reported a healthy growth and maintained its market leadership share of about 57%. The company continues to play out a dual brand strategy leading with Hair Code and Fiancée playing the VFM flanker role.
The company’s Parachute business in the Middle East region continued to face challenges and de-grew during the quarter. This is as a result of certain distribution restructuring initiatives and a mixed response to a pack change initiative in Hair Creams. The Company has stepped up investments to communicate the pack change with aggressive on-ground, in-outlet and sampling activities. It expects the business to return to a growth trajectory in the first quarter of FY14.
The business in South Africa posted a steady growth in top line in the environment where the growth in the segment remains weak.
The business in Vietnam is tracking as per expectations. X-Men maintained its leadership in male shampoos and the number two position in male deodorants. The extension into X-Men for Boss has also received a good response. The Company continues to scale up its presence in neighboring countries like Malaysia, Myanmar, Nepal and Bhutan.
Vijay Subramaniam, CEO, International Business said: “Our International business has faced a very challenging macro environment this year. Two key markets, Egypt and Vietnam, turned in very satisfying performances. I believe that with an improvement in the macro environment in Bangladesh and measures taken in the Middle East bearing results, IBG will be back on a healthy growth path going forward”.
Kaya
Skin Care Solutions
During Q3FY13, Kaya achieved a turnover of Rs. 785.000 Millions (USD 14.5 million) registering a growth of about 5% over Q3FY12. The Kaya business in India and in the Middle East achieved same store sales growth of about 4% during Q3FY13 as compared to Q3FY12. On the back of a very strong Q2 a slight moderation in the growth rates was expected. A slow down in the discretionary spends also impacted overall growth rates. However, Kaya continues to sustain the top line growth trend for the past 9 quarters on a same store basis.
The products from Derma Rx introduced in India continue to gain good traction. More products from Derma Rx range and other products from Kaya will continue to be introduced in India and Middle East in a phased manner. About 25% of the revenues from Indian operations now come from the sale of products.
During Q3FY13, Kaya recorded a revenue growth of about 5% over Q3FY12 and made a profit of Rs. 38.000 Millions (USD 0.7 million) at the PBIT level. The business had reported a loss of Rs. 145.000 Millions (USD 2.67 million) at PBIT level for Q3FY12. The loss during Q3Fy12 also included a one time adjustment of Rs. 130.000 Millions.
While the Company has registered a profit during this quarter, there is some level of uncertainty over discretionary spends owing to the overall inflation in the economy. The Company would also like to observe a few more quarters of good performance before gaining confidence about sustained profitability. The Company also continues to tweak its business model to arrive at one that will deliver the desired level of returns on a sustained basis.
Ajay Pahwa, CEO Kayacommented: “Kaya business continues to sustain same store sales growth and improvement in cost structure. Our strategic focus on expanding Kaya product portfolio is showing results. A new retail format Kaya Skin Bar is being prototyped to further bolster expansion and offer greater access to our customers.”
Outlook
Marico has positioned itself, strategically, in the Developing and
Emerging (D and E) markets of Asia and Africa. Most of these markets have large
populations where affluence is expected to continue to rise and segments where
Marico participates – hair care, body care, skin care and health foods are
under-penetrated. We believe that in D and E markets, focus on the long term is
crucial. Long term success can be ensured only through stronger brands that
enjoy loyal consumer franchises. We have therefore chosen to prioritize
expansion of consumer franchise over expansion of margins.
Milind Sarwate,
Group CFO summed up saying “Over the years, Marico’s has demonstrated the value
of well defined and focused strategy. We will stay the course to deliver long
term shareholder value taking short term fluctuations in our stride”.
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 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.54.43 |
|
|
1 |
Rs.83.20 |
|
Euro |
1 |
Rs.71.91 |
INFORMATION DETAILS
|
Report Prepared
by : |
VRN |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
8 |
|
--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 |
|
DEFAULTER |
|
|
|
--RBI |
YES/NO |
NO |
|
--EPF |
YES/NO |
NO |
|
TOTAL |
|
67 |
This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest capability
for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
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.