TTK Prestige Directors Report, TTK Prestige Reports by Directors
TTK Prestige
BSE: 517506|NSE: TTKPRESTIG|ISIN: INE690A01010|SECTOR: Domestic Appliances
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Directors Report Year End : Mar '14    « Mar 13
Dear Members,
 (Including Management Discussion and Analysis Report)
 The Directors have pleasure in presenting their Fifty Eighth Annual
 Report, together with the Audited Accounts of the Company, for the year
 ended 31st March 2014 as follows:
                                                    (Rs. in lakhs)
                                                 2013-14     2012-13
 Sales (inclusive of excise duty)                132338      138589
 Other income                                       788         473
 Exceptional Income                                 696
 EBIDTA                                           16810       20845
 (before net Exceptional Income)
 EBIDTA                                           17506       20845
 (Including net Exceptional Income)
 Profit/(Loss) before tax                         15175       18520
 Tax Provision                                     3996        5211
 Net Profit/(Loss) after Tax                      11179       13309
 Transfer to General Reserve                       1200        1500
 Proposed Dividend (including tax)                 2724        2322
 Surplus carried to balance sheet                  7255        9487
 Your Company is focussed 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 in the light
 of the philosophy followed by your Company.
 - After a decade of high growth and a CAGR in excess of 25%, your
 company for the first time witnessed a drop of 4.5% in topline largely
 due to sudden shifts in government policy, economic slowdown across the
 country, more trying economic climate in most of the southern markets
 and deteriorating consumer sentiment across categories in the backdrop
 of unprecedented inflation in articles of daily consumption. In sum and
 substance a host of external factors impacted the growth path of your
 company both in domestic market and export market.  .
 - More specific to your Company was the high base effect in the
 previous year due to Induction Stove and its bundled products which
 declined by 38% solely due to shift in Government Policy on domestic
 cooking gas cylinder subsidies. In the rest of the category the growth
 in domestic sale was around 8% which can be considered significant in
 this economic climate. In fact your Company registered impressive
 growths in mixer-grinders, gas stoves, Inner-lid pressure cookers and
 in general in all value added products.
 - Not deterred by general sentiment your company launched an all new
 brand campaign using India''s leading celebrity couple as brand
 ambassadors and introduced several new and advanced models of various
 products. This has ensured that your Company''s brand salience is kept
 more prominent and market share was either maintained or improved
 across product categories and markets.
 - The impact on topline also impacted EBIDTA (before exceptional items)
 and Profit after tax which declined by 19.4% and 16% respectively.
 - Your Company did get some boost to profits due to receipt of enhanced
 compensation and interest aggregating to Rs.8.10 crores through a court
 order relating to portions of industrial land of your Company acquired
 by the Government about 10 years back. Your Company also incurred a sum
 of Rs. 1.14 crores on a VRS scheme in the Hosur factory. The net
 exceptional income was therefore Rs.6.96 crores
 - The operating EBIDTA margin was 12.70% as compared to 15% in the
 previous year, the drop largely being attributable to under-absorption
 of some overheads owing to drop in sales.
 - Earnings per Share stood at Rs. 96.78 (Previous Year Rs. 117.35).
 - The ratio of Operating EBIDTA/ Operating Capital employed (excluding
 CWIP) in the Kitchen Segment is 27.62%. This is on a substantially
 increased asset base due to capitalization of the Gujarat facilities
 which can be used to optimum potential only in the next few years.
 - Your Board of Directors are of the view that the current year
 performance is commendable in the light of several external factors
 which are not under the control of the management and that the constant
 efforts to derisk your Company from being dependent on a few products
 and markets have made your Company withstand the onslaught of several
 adverse external factors in one single year.
 A detailed analysis is provided under the section ''Management''s
 Discussion and Analysis'' forming part of this Director''s Report.
 Your Company continued to be recognized by various agencies for its
 high quality performance in various parameters.
 (1) Your Company''s brand Prestige continues to be recognized as the
 Super Brand in the Kitchen Appliances Segment.  The Company also won
 the The Trusted Brand Award during the year.
 (2) Your Company was honoured with the Dun & Bradstreet - Manappuram
 Finance Limited Corporate Awards 2014 in the Consumer Durable/Domestic
 Appliances Sector. Your Company is listed among the top 500 Companies
 (3) In the area of Retail your Company has bagged :
 (a) the award for the Best Franchiser in the Home category - for the
 8th year in a row.
 (b) the Award for Best Retailer in Home & Office Category - for the 4th
 year in a row.
 (4) The Thought Leadership Award for the best team was won by the
 Company and your Chairman Mr. T.T.  Jagannathan has been honoured with
 the most coveted Award for Excellence in improving Performance through
 (5) Some of your Company''s key executives have also been recognized by
 reputed external Agencies:
 (a) Mr. Chandru Kalro won the Marketing Thought Leader of the Year
 Award and
 (b) Mr. K.G. George was adjudged as one of the Top 50 Retail
 Mr. T.T. Raghunathan and Dr. (Mrs) Latha Jagannathan retire by rotation
 and are eligible for re-election. The information on these retiring
 Directors is provided in the Notice calling the Annual General Meeting.
 Mr. R. Srinivasan is an independent director and in terms of the
 earlier reappointment holds office till the ensuing Annual General
 Meeting. As he fulfills the qualifications required to hold the office
 of independent director, he is proposed to be appointed as independent
 director for a period of five years in accordance with the provisions
 of Companies Act, 2013.  The requisite particulars are provided in the
 notice calling the Annual General Meeting.
 The Fixed Deposits aggregated to Rs. 189.89 lakhs as on 31st March 2014.
 There were 2 unclaimed deposits totalling Rs. 14.22 lakhs, which remained
 unpaid as on that date.
 Your directors recommend payment of a dividend of Rs. 20/- per share for
 the year as compared to Rs.17.5 per share declared for the previous year.
 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 of the 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 31.3.2014.The cost audit report for the
 year ended 31.3.2014 will be filed in accordance with the provisions of
 the Companies Act.
 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.
 The details of foreign exchange earnings and outflow are given in the
 annexure to this Report.
 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.
 As required by Sec 217(2AA) of the Companies Act, 1956 your Directors
 1.  that in the preparation of the 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
                                             (T.T. JAGANNATHAN)
 Registered Office :
 Plot No. 38, SIPCOT Industrial Complex,
 HOSUR - 635 126, Tamil Nadu.
 Place   :    Bengaluru
 Dated   :    15th July, 2014
Source : Dion Global Solutions Limited
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