The Directors have pleasure in presenting their Fifty Seventh Annual
Report, together with the Audited Accounts of the Company, for the year
ended 31st March 2013 as follows:
(Rs. in lakhs)
Sales(inclusive of excise duty) 138589 112271
Other income 473 448
Earnings before tax, interest, 20846 17592
depreciation & amortisation
Profit/(Loss) before tax 18520 16326
Tax Provision 5211 4988
Net Profit/(Loss) 13309 11338
Transfer to General Reserve 1500 1134
Proposed Dividend (including tax) 2322 1974
Surplus carried to balance sheet 9487 8230
REVIEW OF PERFORMANCE:
Your Company is focused on growth with a fair return on capital
employed. Your Company does not follow a standalone margin-led
strategy. Therefore the performance has to be understood only in the
light of the philosophy followed by your Company.
- Sales grew by 23.44% on a higher base after witnessing growths 45%
and 50% in the previous two years and against the back drop of a
significant slowdown in domestic as well as global economies. In
addition, two key Southern States witnessed severe monsoon failure and
power crisis for most part of the year under report leading to steep
fall in consumption in those States.
- Your Company crossed the milestone of 5 million pressure cookers
(including exports) and registered a sales volume of 5.54 million
pressure cookers in the year under report.
- Export volumes of pressure cookers crossed the one million mark for
the financial year
- Your Company crossed the milestone of 1 million Induction Cooktops
and recorded a sales volume of 1.2 million pieces in the year under
report. This volume has been achieved within 4 years of launch.
- Your Company gained a very strong foot-hold in the non-south
markets across all product categories and this has helped in
off-setting the slowdown in the two key southern states, Tamil Nadu and
- EBIDTA grew by 18.5%
- Profit after tax increased by 17.38%.
- The operating EBIDTA margin was 15.04% as compared to 15.67% in the
previous year. EBIDTA margin is largely influenced by the composition
of sales as different product categories yield different margins.
- Earnings per Share (before extra-ordinary/exceptional items) rose
to Rs. 117.35 from Rs. 99.97- a growth of 17.39%.
- The ratio of Operating EBIDTA/ Operating Capital employed
(excluding CWIP) in the Kitchen Segment is 58.4% notwithstanding
substantial additions to asset base for future needs of production.
A detailed analysis is provided under the section ''Management
Discussion and Analysis'' forming part of this Directors'' Report.
AWARDS AND RECOGNITONS
Your Company is being continuously recognized by various reputed
agencies for its overall corporate performance and brand standing. Your
Company''s brand Prestige continues to be recognized as the Super Brand
in the Kitchen Appliances Segment. Your Company received the Power
Brand award during 2012. Some of your Company''s key executives- Mr.
Chandru Kalro, Chief Operating Officer, Mr. V. Sundaresan, CFO and Mr.
K. G. George (Senior Vice President, Retail) have also been recognized
as top performers/icons by reputed external agencies.
Mr. T.T. Jagannathan, Executive Chairman, received the coveted Ernst &
Young''s Entrepreneur of the Year award for the year 2012 in the
Consumer Product Category.
Your Company''s R&D Centre at Hosur has received recognition from the
Department of Science and Technology which will enable your Company to
avail certain benefits under Direct and Indirect tax laws subject to
The direct employment strength stood at 1306 as compared to 1141 in the
Your Company continues to have cordial industrial relations in all its
CAPITAL EXPENDITURE & EXPANSION PLANS
As already reported your company has completed most of its capital
expenditure investments in Uttarakhand, Coimbatore and Hosur units. All
these facilities are delivering good volume of commercial production.
The installation of plant in Gujarat is in advanced stage and the
facility is expected to commence production during the second half of
FY 2013-14. Though the commissioning is delayed, there is no cost
The overall capital expenditure plan (other than normal capital
expenditure) for the three years commencing April 2010 is pegged at
around Rs. 325 crores out of which around Rs. 275 crores has been
incurred till 31st March 2013 and the balance will be incurred during
the financial year 2013-14. With this, your Company would have
installed sufficient capacities for Pressure Cookers and Cookware to
meet the long-term requirements and would have also created facilities
for assembly of appliances.
SCHEMES OF ARRANGEMENT:
1. Under the Scheme of Amalgamation with M/s. Prestige Housewares
India Limited (PHIL) sanctioned by the Honourable Madras High Court at
Madras during the year under report your Company allotted 20106 equity
shares of Rs. 10/- each to the shareholders of PHIL. The appointed date
of the Scheme being 1.4.2011, the previous year figures have been
suitably adjusted in the Annual Report.
2. During November 2012 the Board of Directors of your Company
approved a Scheme of Arrangement (Demerger) whereby the Kitchen
Appliances Division of M/s Triveni Bialetti Industries Private Limited
(TBI), (a subsidiary of M/s. Bialetti Industries SpA, Italy) with all
its assets, rights, liabilities, obligations, benefits under tax laws
etc., will be vested in your Company, the Appointed Date being 1st
April 2012. The Scheme has been approved by the Stock Exchanges but
further approvals are required including those of Shareholders and
Bombay and Madras High Courts. On final sanction of the Scheme by the
High Courts, books of accounts will be updated in accordance with the
TBI, which has its manufacturing base in Maharashtra, is contract
manufacturing certain products for your Company.
Mr. Ajay I Thakore, Dr. (Mrs.) Vandana Walvekar and Mr. K. Shankaran
retire by rotation and are eligible for re-election. The information on
these retiring Directors is provided in the Notice calling the Annual
The Board of Directors at their meeting held on 16th May 2013
re-appointed Mr. T.T. Jagannathan as Executive Chairman for a further
period of five years from 1.7.2013 on revised terms of remuneration as
recommended by the Remuneration Committee. The requisite resolution
seeking the approval of the Shareholders is included in the Notice
calling the Annual General Meeting.
The Public Deposits aggregated to Rs. 201.14 lakhs as on 31st March
2013. There were no unclaimed deposits which remained unpaid as on that
Your directors recommend payment of a dividend of Rs. 17.50 per share
for the year as compared to Rs. 15 per share declared for the previous
This Directors'' Report and the Management Discussion and Analysis
included therein may contain certain statements, which are futuristic
in nature. Such statements represent the intentions of the Management
and the efforts being put in by them to realize certain goals. The
success in realizing these goals depends on various factors both
internal and external. Therefore, the investors are requested to make
their own independent judgments by taking into account all relevant
factors before taking any investment decision.
Report on Corporate Governance is separately presented as part of the
Annual Report. Management Discussion and Analysis is included in this
Directors'' Report in the preceding sections.
The particulars as required under Sec.217 (2A) of the Companies Act,
1956 are given in the Annexure to this report.
M/s. S.Viswanathan, Chartered Accountants retire at the ensuing Annual
General Meeting and are eligible for reappointment as statutory
auditors ofthe Company.
In conformity with the directives of the Central Government, your Board
of Directors has appointed Sri. V. Kalyanaraman, Cost Accountant, No.4
Second Street, North Gopalapuram, Chennai 600 086, as the Cost Auditor
under Section 233B of the Companies Act, 1956, for the audit of cost
accounts for Aluminium, Stainless Steel Pressure Cookers, Non-stick
Cookware for the year ended 31.3.2013. The cost audit report for the
year ended 31.3.2013 will be filed on or before 30.9.2013.
Your Company''s shares are listed in the Bombay Stock Exchange and
National Stock Exchange and the listing fees for these two exchanges
have been paid.
FOREIGN EXCHANGE EARNINGS
The details of foreign exchange earnings and outflow are given in the
annexure to this Report.
CONSERVATION OF ENERGY AND RESEARCH AND DEVELOPMENT
The measures related to conservation of energy, etc., are covered in
the annexure to this Report pursuant to Section 217(1) (e) of the
Companies Act, 1956.
DIRECTORS'' RESPONSIBILITY STATEMENT
As required by Sec 217(2AA) ofthe Companies Act, 1956 your Directors
1. that in the preparation ofthe annual accounts, the applicable
accounting standards have been followed, along with proper explanation
relating to material departures;
2. that they have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent, so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the profit or loss
of the Company for that period;
3. that they have taken proper and sufficient care for the maintenance
of adequate accounting records, in accordance with the provisions of
the Companies Act, 1956 for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities; and
4. that they have prepared the annual accounts on a going concern
Your Directors deeply appreciate and acknowledge the significant and
continued co-operation given to your Company by the Bankers, Financial
Institutions and the employees of the Company.
For and on behalf of the Board
Registered Office :
Plot No. 38, SIPCOT Industrial Complex,
HOSUR - 635 126, Tamil Nadu.
Place : Bengaluru
Dated : 16th May, 2013