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Directors Report of TTK Prestige Ltd.

Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting their Fifty Ninth Annual Report, together with the Audited Accounts of the Company, for the year ended 31st March, 2015 as follows:

FINANCIAL RESULTS (Rs. in lakhs) 2014-15 2013-14

Sales (inclusive of excise duty) 142142 132338

Other income 510 788

Exceptional Income 244 696

EBIDTA 15434 16810 (before net Exceptional Income)

EBIDTA 15678 17506 (Including net Exceptional Income)

Profit/(Loss) before tax 13330 15175

Tax Provision 4098 3996

Net Profit/(Loss) after Tax 9232 11179

Transfer to General Reserve 1000 1200

Proposed Dividend (including tax) 3083 2724

Surplus carried to balance sheet 5149 7255

Review of performance :

a. Your Company''s current year performance has to be judged from the background of continuing sluggish economy coupled with weak consumer demand and most importantly from the point of view of investments being made even during this sluggish phase keeping in view the long-term health of your Company. The investments have been not only in the nature of capital assets creating capacity for the long-term but also revenue expenses in building brand, distribution and human capital for the future. Therefore these measures do have a transient impact on margins which can improve over a period of time once the investments start fuelling growth.

b. Shareholders are also aware that your Company does not follow a standalone margin-led policy but is focussed on growth with a fair long-term return on capital employed.

c. Your Company is back to growth path, albeit at a lower rate of 7.4% after a decline of around 4% in the previous financial year. This growth is in line with the overall economic growth notwithstanding specific factors affecting the growth in appliances segment in general. It is to be noted that the channel conflict on account of entry of on- line channels had some adverse impact on primary sales for the year especially the period between August 2014 and February 2015.

d. While there has been recovery in business growth, the EBIDTA prior to exceptional items declined by about 8% from Rs. 168.10 crores to Rs. 154.34 crores after providing for CSR contributions of about Rs. 3.38 crores. The operating EBIDTA margin was around 11% as compared to 12.7% in the previous year. The background for this decline is stated in para ''a'' above. The capacity building initiatives coupled with soft investments in brand building, distribution, service network and human resources resulted in transient under absorption of overheads. There was also some lag in passing on input costs on account of pipeline inventory. The product mixes in certain appliance categories while contributing to volume growth resulted in a lower absolute value in top line and thus lower absolute margins.

e. Net profits declined by about 17% from Rs. 111.79 crores to Rs. 92.32 crores due to higher provision for depreciation on account of the changes brought about by Companies Act 2013 and also higher provision for taxation as the 100% benefits from Uttarakhand units are reduced to 30% from 2014-15 onwards. As a result the Earnings per Share stood at Rs. 79.30 (PY Rs. 96.78).

f. Your Company became debt-free as at the end of 31st March, 2015 and is carrying significant net free cash.

g. In spite of substantial additions to manufacturing asset base and lower capacity utilisation the ROCE was healthy at 24.20%.

h. Your Board has recommended a higher dividend of Rs. 22/- per share (PY Rs. 20/- per share) a gross pay-out ratio (including dividend distribution tax) in excess of 30% of net profits.

Your Board of Directors is of the view that the current year performance is commendable taking into account the general sluggish economy both domestic and global. The market share of the key product categories was maintained or improved across geographies which are key-factors to note.

A detailed analysis is provided under the section ''Management''s Discussion and Analysis'' forming part of this Director''s Report.

Aawards and recognitions

Your Company continued to be recognized by various agencies for its high quality performance in various parameters. During the Financial Year 14-15, your Company bagged the following awards.

1. D & B top 500 Companies Award May 2014-15

2. Frost and Sullivan Award 2014-15

3. World Brand Summit Award

4. Readers Digest Most trusted brand

5. ET Now Best Brand Award

6. Asia''s Most promising brand in kitchen appliances segment

7. 100 most valuable brands of the year

8. Franchisee India Award - Home products

9. Award for Retail Excellence in Home Products & office Equipment

Your Company''s brand Prestige continues to be recognized as the Super Brand in the Kitchen Appliances Segment

DIRECTORS

Mr. Ajay I. Thakore, an Independent Director stepped down from the office as at the closing hours of 31st March, 2015. Mr. Thakore was a Director on your Board for nearly 40 years giving valuable guidance from time to time. The Board placed on record its deep appreciation for the services rendered by Mr. Thakore during his tenure on the Board.

Mr. S. Ravichandran, Managing Director, retired from the services of the Company with effect from the closing hours of 31st March, 2015. He was with the Company first as Joint Managing Director from 5th February, 1997 and as Managing Director since 2001. He has contributed significantly to the turnaround and growth of the Company during his 18 year association with your Company. The Board placed on record its deep appreciation for the unstinting efforts and contributions made by Mr. S. Ravichandran.

Mr. Murali Neelakantan, a legal professional, with vast exposure to commercial and corporate laws both in India and abroad, has joined your Board as Independent Director effective from 25th March, 2015 having been appointed by the shareholders through postal ballot. Mr. Arun Thiagarajan, Mr. Dileep Krishnaswamy and Dr. (Mrs.) Vandana Walvekar have been reappointed as Independent Directors with effect from 25th March, 2015 by the shareholders through postal ballot. All these directors have been appointed for a period of 5 years and are not liable to retire by rotation.

Pursuant to the request of Dr. (Mrs) Latha Jagannathan, a Promoter Non-executive Director your Board decided to accept her resignation with effect from the closing hours of 27th May, 2015. The Board placed on record its deep appreciation for the services rendered by Dr. (Mrs.) Latha Jagannathan during her tenure on the Board.

As per the recommendation of Nomination and Remuneration Committee, your Board decided to co-opt Dr. T.T. Mukund in the casual vacancy caused by the resignation of Dr. (Mrs) Latha Jagannathan. The appointment of Dr. T.T. Mukund as Non-independent/Non-executive Director takes effect from 29th May, 2015.

Dr. T.T. Mukund is the son of Mr. T.T. Jagannathan, Executive Chairman and belongs to the Promoter Group. He is 38 years of age and is presently Reader National Centre for Biological Services, Bengaluru. He graduated from Cornell University, USA and did Ph.D. (Physics) at Massachusetts Institute of Technology, Cambridge, MA.

Mr. K. Shankaran retires by rotation and is eligible for re-appointment. The information on the retiring Director is provided in the Notice calling the Annual General Meeting.

FIXED DEPOSIT

Pursuant to the provisions of Section 74 of the Companies Act, 2013 your Company has, during the year 2014-15 repaid all the deposits accepted from public. There are no deposits outstanding or remaining unpaid as at the end of 31st March, 2015.

DIVIDEND

Your directors recommend payment of a dividend of Rs. 22/- per share for the year as compared to Rs. 20/- per share declared for the previous year.

FUTURISTIC STATEMENTS

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.

CORPORATE GOVERNANCE

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.

LISTING

Your Company''s shares are listed in the BSE Limited and National Stock Exchange and the applicable listing fees have been paid.

FURTHER DISCLOSURES UNDER THE COMPANIES ACT, 2013 AND THE RULES MADE THEREUNDER:

(a) Extract of Annual Return:

Extract of Annual Return (Form MGT-9) is enclosed as Annexure A

(b) Number of meetings of the Board:

The Board of Directors met 6 (six) times during the year 2014-15. The details of the Board Meetings and the attendance of the Directors are provided in the Report on Corporate Governance.

(c) Corporate Social Responsibility (CSR) Committee:

As per the provisions of Section 135 of the Companies Act, 2013 and the Rules made thereunder, your Company constituted the Corporate Social Responsibility Committee which comprises of Mr. T.T. Jagannathan as Chairman, Mr. R Srinivasan, Mr. K Shankaran and Dr. (Mrs) Latha Jagannathan as Members.

The Corporate Social Responsibility (CSR) Policy enumerating the CSR activities to be undertaken by the Company, in accordance with Schedule VII to the Companies Act, 2013 was recommended to the Board and the Board adopted the same. The said policy was also made available on the website of the Company http://www.ttkprestige.com. The Annual Report under CSR Activities is annexed to this report as Annexure B.

The details relating to the meetings convened, etc. are furnished in the Report on Corporate Governance.

(d) Composition of Audit Committee:

The Board has reconstituted the Audit Committee on 21st August, 2014, in accordance with the provisions of Section 177 of the Companies Act, 2013 and the Rules made thereunder and Clause 49 of the Listing Agreement, which comprises of Mr. Dileep Krishnaswamy as Chairman, Mr. R Srinivasan and Mr. Arun Thiagarajan as Members. Mr. K Shankaran - Director and Secretary is the Secretary of the Committee. More details on the Committee are given in the Report on Corporate Governance.

(e) Related Party Transactions:

During the year under review, no transaction of material nature has been entered into by the Company with its promoters, the directors or the management, their subsidiaries or relatives, etc., that may have a potential conflict with the interests of the Company.

All related party transactions are placed before the Audit Committee as also the Board for approval. Prior omnibus approval of the Audit Committee is obtained on a yearly basis for the transactions which are of a unforeseen or repetitive nature. A Statement giving details of the transactions entered into with the related parties, pursuant to the omnibus approval so granted, is placed before the Audit Committee and the Board of Directors for their approval / ratification on a quarterly basis.

The Register of Contracts containing transactions, in which directors are interested, is placed before the Audit Committee / Board regularly.

The Board of Directors of the Company, on the recommendation of the Audit Committee, adopted a policy on Related Party Transactions, to regulate the transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act, 2013 and the Listing Agreement. The Policy as approved by the Board is uploaded on the Company''s website at http://www.ttkprestige.com.

The details of the Related Party Transactions in Form AOC-2 are annexed as Annexure C to this Report.

(f) Directors and Key Managerial Personnel:

None of the Directors are disqualified from being appointed or holding office as Directors, as stipulated under Section 164 of the Companies Act, 2013.

(i) Retirement / Cessation:

- Mr. S Ravichandran retired from the position of Managing Director with effect from the closing hours of 31st March, 2015.

- Mr. Ajay I Thakore retired from the office of Independent Director at the closing hours of 31st March, 2015.

- Dr. (Mrs) Latha Jagannathan retired from the office of Non-Executive Director with effect from the closing hours of 27th May, 2015.

- Dr. T.T. Mukund was co-opted in the casual vacancy caused by the resignation of Dr. (Mrs.) Jagannathan with effect from 29th May, 2015.

(ii) Appointment / Re-appointment of Directors:

(a) Pursuant to the provisions of Section 149 and other applicable provisions, if any, of the Companies Act, 2013 and the Rules made thereunder and as per Clause 49 of the Listing agreement, the following Directors were appointed as Independent Directors of the Company:

- Mr. R. Srinivasan was appointed as an Independent Director, effective 21st August, 2014, for a term of five years, not liable to retire by rotation at the 58th Annual General Meeting held on 21st August, 2014.

- Dr. (Mrs.) Vandana Walvekar, Mr. Dileep Krishnaswamy and Mr. Arun Thiagarajan and Mr. Murali Neelakantan were appointed as Independent Directors, effective 25th March, 2015, for a term of five years, not liable to retire by rotation through the conduct of Postal Ballot including e-Voting.

(b) Mr. K Shankaran, liable to retire by rotation at the ensuing Annual General Meeting, being eligible, offers himself for re-appointment. The Board recommends his re-appointment.

(iii) statement on declaration by the Independent Directors of the Company:

All the Independent Directors of the Company have given declarations under Section 149(7) of the Companies Act, 2013 that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. The terms and conditions of appointment of the Independent Directors are posted on the website of the Company http://www.ttkprestige.com.

(iv) Key managerial Personnel (KMP):

The Board at its meeting held on 21st August, 2014, confirmed the following managerial personnel as Key Managerial Personnel (KMP):

- Mr. S. Ravichandran, Managing Director as Chief Executive Officer (CEO) till 31st March, 2015

- Mr. K Shankaran, Director & Wholetime Company Secretary as Company Secretary; and

- Mr. V Sundaresan, Sr. Vice President - Finance as Chief Financial Officer (CFO).

Mr. Chandru Kalro has been appointed as Managing Director/CEO with effect from 1st April, 2015 pursuant to approval of his appointment by shareholders through postal ballot carried out during March, 2015.

(v) Performance Evaluation of the Board, its Committees and the directors:

In compliance with the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the performance evaluation of the Board was carried out during the year under review. More details on the same are given in the Report on Corporate Governance.

(vi) Remuneration Policy:

Your Company follows a policy on remuneration of Directors and Senior Management. The policy is framed by the Nomination and Remuneration Committee and approved by the Board. More details on the same are given in the Report on Corporate Governance.

(g) Auditors:

(i) Auditors and their Report:

In accordance with the provisions Section 139 and other applicable provisions, if any, of the Companies Act, 2013 and the Rules made thereunder, M/s S Viswanathan, Chartered Accountants, Chennai (Firm Registration No. 004770S) were appointed as Statutory Auditors, for a term of three years to hold office from the conclusion of 58th Annual General Meeting till the conclusion of 61st Annual General Meeting, subject to ratification by the members at every Annual General Meeting.

Accordingly, a Resolution seeking members'' ratification for their appointment from the conclusion of this Annual General Meeting till the conclusion of the next Annual General Meeting of the Company is included under Item No. 4 of the Notice convening the Annual General Meeting.

The Auditors'' Report to the Shareholders for the year under review does not contain any qualifications.

(ii) Cost Auditor and Cost Audit Report:

- Appointment for the year 2015-16:

Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the Cost Records of the Company relating to "Stainless Steel Pressure Cookers and Cookware" are required to be audited.

The Board of Directors, on the recommendation of the Audit Committee, appointed Mr. V. Kalyanaraman as Cost Auditor of the Company, for the financial year 2015-16 and fixed their remuneration.

Mr. V. Kalyanaraman has confirmed that his appointment is within the limits of the Section 141 of the Companies Act, 2013 and has also certified that he is free from any disqualifications specified under the provisions of Section 141 of the Companies Act, 2013.

The Audit Committee also received a Certificate from the Cost Auditor certifying the independence and arm''s length relationship with the Company.

Pursuant to the provisions of Section 148 of the Companies Act, 2013 and the Rules made thereunder, the approval of the Members is sought by means of an Ordinary Resolution for the remuneration payable to Mr. V. Kalyanaraman, Cost Auditor, under Item No.5 of the Notice convening the Annual General Meeting.

The Cost Audit Report for the year ended 31st March, 2015 would be filed on or before the due date (i.e.) 27th September, 2015.

- Cost Audit Report for the year 2013-14:

The Cost Audit Report for the financial year ended 31st March, 2014 was filed on 4th April, 2015, vide SRN S37174786 on the Ministry of Corporate Affairs website.

(iii) Secretarial Auditor and Secretarial Audit Report:

The Board had appointed Mr. Parameshwar G Hegde, Company Secretary in Whole-time Practice, to carry out Secretarial Audit under the provisions of Section 204 of the Companies Act, 2013 for the financial year 2014-15. The Report of the Secretarial Auditor in Form MR-3 is annexed to this report as Annexure G. The report does not contain any qualification.

(h) Transfer to Investor Education and Protection Fund:

Your Company has transferred a sum of Rs. 4.12 lakhs during the financial year 2014-15 to the Investor Education and Protection Fund established by the Central Government, in compliance with Section 125 of the Companies Act, 2013. The said amount represents the unclaimed dividends for the year ended 31st March, 2007, which were lying unclaimed with the Company for a period of seven years from their respective due dates of payment.

(i) unclaimed shares

In terms of Clause 5A of the Listing Agreement, the Company has opened a Suspense Account for holding the unclaimed share. The number of such share at the beginning of the year was 1,600 and the number of shareholders were 12. No movement has taken place during the financial year 2014-15. The voting rights on the shares in the suspense account as on 31st March, 2015 shall remain frozen till the rightful owners of such shares claim the shares.

(j) Conservation of Energy:

The prescribed particulars under Rule 8(3) of The Companies (Accounts) Rules, 2014 relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, are furnished in the Annexure D to this Report.

(k) Particulars of employees:

The information required under Section 197 of the Companies Act, 2013 and the Rules made thereunder are annexed to this Report as Annexure E & Annexure F.

(l) subsidiary Company:

Your Company does not have any Subsidiary.

(m) Loans, Guarantees and investments under section 186 of the Companies Act, 2013:

During the year your Company had not given any loan, provided any guarantee OR made any investment under Section 186 of the Companies Act, 2013. Your Company holds 1440 equity shares of Rs. 10/- each in TTK Healthcare Limited. Your Company had in the past provided secured inter-corporate loan/deposit of Rs. 18.75 crores to Triveni Bialetti Industries P Ltd, an unrelated party with whom your Company has business transactions and this amount is still carried.

(n) Significant and Material Orders passed by the Regulators or Courts:

There are no significant and material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

(o) Whistle Blower Policy:

In accordance with the provisions of Section 177(9) of the Companies Act, 2013 and the Rules made thereunder and also Clause 49 of the Listing Agreement, your Company established a vigil mechanism termed as Whistle Blower Policy, for directors and employees to report concerns about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of Conduct or Ethics Policy, which also provides for adequate safeguards against victimization of director(s) / employee(s) who avail of the mechanism and also provide for direct access to the Corporate Governance Officer / Chairman of the Audit Committee / Executive Chairman in exceptional cases.

The Whistle Blower Policy is made available on the website of the Company http://www.ttkprestige.com.

(p) Obligation of your Company under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:

In order to prevent sexual harassment of women at work place a new Act,The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been notified on 9th December, 2013. Under the said Act, every Company is required to set up an Internal Complaints Committee to look into complaints relating to sexual harassment at work place of any women employee.

Your Company has adopted a policy for prevention of Sexual Harassment of Women at Workplace and has constituted a Committee with a NGO as one of its Members, for implementation of the said Policy. During the year 2014-15, there were no complaints.

Directors'' responsibility statement

As required by Sec.134(5) read with Sec.134(3)(c) of the Companies Act, 2013 your Directors confirm

a. that in the preparation of the annual accounts, the applicable accounting standards have been followed, along with proper explanation relating to material departures;

b. 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;

c. that they have taken proper and sufficient care for the maintenance of adequate accounting records, in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

d. that they have prepared the annual accounts on a going concern basis; and

e. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively.

f. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

Acknowledgements

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) Executive Chairman

Registered Office : Plot No. 38, SIPCOT Industrial Complex, HOSUR - 635 126, Tamil Nadu.

Place : Bengaluru Dated : 27th May, 2015


Mar 31, 2014

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:

FINANCIAL RESULTS

(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

REVIEW OF PERFORMANCE :

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.

AWARDS AND RECOGNITIONS

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 2014.

(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 Leadership."

(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 Professionals"

DIRECTORS

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.

FIXED DEPOSIT

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.

DIVIDEND

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.

FUTURISTIC STATEMENTS

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.

CORPORATE GOVERNANCE

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.

EMPLOYEES

The particulars as required under Sec. 217 (2A) of the Companies Act, 1956 are given in the Annexure to this report.

AUDITORS

M/s. S. Viswanathan, Chartered Accountants retire at the ensuing Annual General Meeting and are eligible for reappointment as statutory auditors of the Company.

COST AUDITOR

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.

LISTING

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) of the Companies Act, 1956 your Directors confirm

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 basis.

ACKNOWLEDGEMENTS

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)

Chairman Registered Office :

Plot No. 38, SIPCOT Industrial Complex, HOSUR - 635 126, Tamil Nadu.

Place : Bengaluru Dated : 15th July, 2014


Mar 31, 2013

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:

FINANCIAL RESULTS

(Rs. in lakhs)

2012-13 2011-12

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 Kerala.

- 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 prescribed conditions.

The direct employment strength stood at 1306 as compared to 1141 in the previous year.

Your Company continues to have cordial industrial relations in all its manufacturing units.

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 overrun.

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 applicable practices.

TBI, which has its manufacturing base in Maharashtra, is contract manufacturing certain products for your Company.

DIRECTORS

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 General Meeting.

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.

FIXED DEPOSIT

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 date.

DIVIDEND

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 year.

FUTURISTIC STATEMENTS

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.

CORPORATE GOVERNANCE

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.

EMPLOYEES

The particulars as required under Sec.217 (2A) of the Companies Act, 1956 are given in the Annexure to this report.

AUDITORS

M/s. S.Viswanathan, Chartered Accountants retire at the ensuing Annual General Meeting and are eligible for reappointment as statutory auditors ofthe Company.

COST AUDITOR

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.

LISTING

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 confirm

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 basis.

ACKNOWLEDGEMENTS

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)

Chairman

Registered Office :

Plot No. 38, SIPCOT Industrial Complex,

HOSUR - 635 126, Tamil Nadu.

Place : Bengaluru

Dated : 16th May, 2013


Mar 31, 2012

The Directors have pleasure in presenting their Fifty Sixth Annual Report, together with the Audited Accounts of the Company, for the year ended 31st March 2012 as follows:

FINANCIAL RESULTS

(Rs in lakhs)

2011-12 2010-11

Sales (inclusive of excise duty) 112271 77558

Other income 308 430

Profit before Extra-Ordinary item 16324 12094

Extra-Ordinary/exceptional item 0 (59)

Profit/(Loss) before tax 16324 12035

Tax Provision 4988 3660

Net Profit/(Loss) 11336 8375

Transfer to General Reserve 1134 838

Proposed Dividend (including tax) 1974 1645

Surplus carried to balance sheet 8228 5892

REVIEW OF PERFORMANCE :

Your Company is focussed on growth with a fair return on capital employed. Your Company does not follow a standalone margin led strategy as such strategy can be myopic and can lead to unwarranted cuts in investments in brand as well as capacity expansion. Therefore the performance has to be understood only in the light of the philosophy followed by your Company.

- Sales grew by 44.75%

- All time high absolute value growth - around Rs 347 crores

- Profit before extra-ordinary items increased by 35%.

- Profit after tax increased by 35.35%.

- The operating EBIDTA margin was 15.6% as compared to 16.2 % in the previous year. Minor drop in margin was largely contributed by sharp rupee depreciation during September/October 2011 which could not be passed on to the market in the short-term. However your company was able to register more than expected topline growth ensuring a fair return on investments.

- Earnings per Share (before extra-ordinary/exceptional items) rose to Rs 100.13 from Rs 73.98 - a growth of about 35%.

- The ratio of Operating EBIDTA/ Operating Capital employed (excluding CWIP) in the Kitchen Segment was more than 60% notwithstanding substantial additions to asset base for future needs of production.

A detailed analysis is provided under the section "Management's Discussion and Analysis" forming part of this Director's Report.

AWARDS AND RECOGNITON

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's retail network Prestige Smart Kitchen continues to get several awards viz.

a. "Best Franchiser - Home" Award - Your Company has received this award 5 times in 6 years by Franchise India Holdings (P) Ltd.

b. "Best Retailer- Home" Award - Your Company has been receiving this award for the last 3 years continuously.

ALLIANCES

Your company has been actively looking for enlarging its product and customer base and in the process thought it fit to develop/ build relationships with certain global corporations to bring certain advanced product ranges as well as international brands into the business of your Company. These are calculated not only to consolidate your Company's position in the mass market segment but also tap the top of the pyramid segment. The details are given below.

(i) Your Company has concluded agreements with World Kitchen, USA which will enable your Company to enter the high-end Tableware/Cookware and Storeware segments. Your Company's basket of products will henceforth include international brands such as Corelle, Corningware, Pyrex, Visions and Snapware. Except Corelle, all other products will carry the brand of Prestige also. The initial arrangement is one of distribution and after gaining sufficient experience and volumes, a manufacturing Joint Venture may be set up for decoration of Corelle range of products and manufacture of Snapware range of storeware products. The sale of these products will commence during the first quarter of the financial year 2012-13.

(ii) Your Company has also concluded a business collaboration agreement with Vestergaard Frandson Group, Switzerland which will enable your Company to enter the fast growing domestic water filter segment. The products will be made with the patented LifeStraw technology of Vestergaard. The products will be manufactured / assembled in India through your Company and your Company will market and distribute the same across India.

(iii) Your Company has also entered into agreements with Bialetti Industries Spa, Italy whereby your Company has bought their pressure cooker and cookware manufacturing plants in Romania and Italy for installation in India. Some of the machineries have already been installed and commissioned and the balance will be installed and commissioned during the year 2012-13. Bialetti Industries is also outsourcing Stainless Steel Pressure cookers from your Company. Your Company has also entered into outsourcing arrangements with their Indian subsidiary.

CAPITAL EXPENDITURE & EXPANSION PLANS

Your company has completed most of its capital expenditure investments in Uttarakhand, Coimbatore and Hosur units. All these expansions have started commercial production.

Your Company has completed most of the formalities relating to the acquisition of land in Gujarat and the construction of the factory has commenced. Most of the machines have arrived. The first phase of this project is expected to be in place before the end of the financial year 2012-13.

The overall capital expenditure plan for the three years commencing April 2010 is pegged at around Rs 300 crores out of which around Rs 190 crores has been incurred till 31st March 2012. The balance will be incurred during the financial year 2012-13. With this your Company would have installed sufficient capacities for Pressure Cookers and Cookware to meet the long-term requirements.

SCHEME OF AMALGAMATION WITH PRESTIGE HOUSEWARES INDIA LIMITED

The shareholders are aware that the Scheme has already been unanimously approved by the shareholders at the General Meeting convened pursuant to the orders of the Honourable High Court at Chennai. The necessary petitions for sanction of the Scheme have been filed before the Court and order of the Court is awaited. The appointed date of the Scheme is 1st April 2011 and necessary entries will be carried out in the books of account only after the Sanction of the Court is received.

DIRECTORS

Mr. Dileep K Krishnaswamy, Mr. Arun K. Thiagarajan and Mr. T.T. Raghunathan 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.

FIXED DEPOSIT

The Public Deposits aggregated to Rs 217.25 lakhs as on 31st March 2012. There were no unclaimed deposits which remained unpaid as on that date.

DIVIDEND

Your directors recommend payment of a dividend of Rs 15/- per share for the year.

FUTURISTIC STATEMENTS

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.

CORPORATE GOVERNANCE

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.

EMPLOYEES

The particulars as required under Sec.217 (2A) of the Companies Act, 1956 are given in the Annexure to this report.

AUDITORS

M/s. S.Viswanathan, Chartered Accountants retire at the ensuing Annual General Meeting and are eligible for reappointment as statutory Auditors of the Company.

COST AUDITOR

In conformity with the directives of the Central Government, the Company 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 and Non-stick Cookware for the year ended 31.3.2012. The cost audit report for the year ended 31.3.2012 will be filed on or before 27.9.2012, the due date.

LISTING

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) of the Companies Act, 1956 your Directors confirm

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 basis.

ACKNOWLEDGEMENTS

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.

Registered Office: For and on behalf of the Board

Plot No. 38,

SIPCOT Industrial Complex,

HOSUR - 635 126,

Tamil Nadu.

(T.T. JAGANNATHAN)

Chairman

Place : Coimbatore

Dated : 4th May, 2012

 
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