Investors Presentation: Hem Securities Limited

Investors Presentation: Hem Securities Limited

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Private & Confidential

Executive Summary 3

Business Overview 5

Product Profile 6

Business Strategy 7

Competitive Strengths 8

Awards and Recognition 9

Strong Management Team 10

Industry Outlook 11

Competitors Analysis 12

Financials Performance – ASL 13

Reach Us 18

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Executive Summary

• ADVANCE SYNTEX LIMITED was incorporated as Advance Syntex Private Limited on September 21, 1990.

• The Company is mainly engaged in manufacturing of Metalized Films (MF), Lacquered (Coated) Metalized Polyester Films (LMPF), glitter powder (Zari Powder) and Metallic Yarn (Polyester Badla).

• The products of the Company are used in textiles, flexible packaging, lamination, printing, decorations, advertising, paints, inks, craft glue, glass bangles, synthetic leather, floor tiles, walls, cosmetics (such as nail polish, eye-liner, hair gel, lipstick etc.) and various other products.

• Presently, the manufacturing activities are undertaken at three different units with total combined area of above 3100 sq. mtrs and installed production capacity of 18 Lakhs Kg p.a. for LMPF, 34 Lakhs Kg p.a. for Metalized Films and 0.60 Lakhs Kg p.a. for Resins.

Company Overview

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Issue Size: 2.52 Cr

No. of shares: 21,00,000 Shares

Face Value: Rs. 10

Issue Price: Rs. 12

Lead Manager to the Issue: Hem Securities Limited

Registrar: Sharex Dynamic (India) Private Limited

Trading Lot: The Market lot and Trading lot for the Equity

Share is 10,000 (Ten Thousand) and the multiple of 10,000;

subject to a minimum allotment of 10,000 Equity Shares to the

successful applicants.

Issue opens : XXX

Issue closes : XXX

Issue Highlights

Executive Summary

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Business Overview

• The Company (Advance Syntex Limited) was originally incorporated as Advance Syntex Private Limited on September 21, 1990 under the provisions of Companies Act, 1956 with Registrar of Companies, Gujarat.

• The Company is mainly engaged in manufacturing of Metalized Films (MF), Lacquered (Coated) Metalized Polyester Films (LMPF), glitter powder (Zari Powder) and Metallic Yarn (Polyester Badla). Glitter Powder and Metallic Yarn are manufactured through Job Work of LMPF produced by The Company.

• Presently, the manufacturing activities are undertaken at three different units with total combined area of above 3100 sq. mtrs and installed production capacity of 18 Lakhs Kg p.a. for LMPF, 34 Lakhs Kg p.a. for Metalized Films and 0.60 Lakhs Kg p.a. for Resins.

• Below are the details of the manufacturing Units:-

Unit: 1 located at 233/2 & 238/2, GIDC, POR Ramangamdi, Vadodara - 391243, Gujarat, India

Unit: 2 located at 104, GIDC, POR Ramangamdi, Vadodara, - 391243, Gujarat, India

Unit: 3 located at 149, GIDC, POR Ramangamdi, Vadodara, - 391243, Gujarat, India

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Advance Syntex Limited Company

Name Vadodara, Gujarat

Registered Office

GIDC, POR Ramangamdi, Vadodara Warehouse

S&P BSE SME IPO Exchange September 21,

1990 Date of

Incorporation Plastic, Metallic Yarn/Fibre, Textile,

Polyester Industry


Product Profile

Products Features and Applications

Metalized Films (MF) Metallized BOPET Films are used for Flexible packaging, metallic yarn,

sequins for textiles, decoratives etc. Metallized BOPP films are used for

flexible packaging, gift wraps and decoaratives

Slitted Films - Polyester (BOPET)

and BOPP films

Uses of BOPET Films includes flexible food packaging, barrier films,

vacuum insulation panels, hot stamping foil, photo resist films, insulation

materials etc.

BOPP Films are widely used as a packaging material for packaging

products such as snack foods, fresh produce and confectionery.

Epoxy Resins Used in manufacturing of Lacquered (Coated) Metalized Polyester Film and

Zari threads.

Lacquered (Coated) Metalized

Polyester Film (LMPF)

Used in manufacturing of glitter powder, metallic yarn, packaging and

other decorative products

Glitter Powder ( Zari Powder) Used in Textiles, Construction Materials, Interior Decoration, Accessories

and Injection Molding

Metallic Fibres Used in making of upholstery fabrics (lace, brocade), interior decoration

items (curtains, sofa covers etc), Automotive textiles, hosiery products etc.

Metallic Yarns (Polyester Badla) Used in Weaving, Knitting, Embroidery, Laces etc.

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Maintain and expand long-term relationships

with clients

Company believes that business is a by-product of relationship. The business model is based on client relationships that are established over period of time. The Company believes that a long-term client relationship with large clients fetches better dividends.

Increasing Operational efficiency

This is a continuous process in the organization and the skills the Company impart in the people gives importance to clients. The Company aims to do this by leveraging the marketing skills & relationships and further enhancing customer satisfaction.

Leveraging of the company’s marketing

skills and relationships

The Company intends to improve operating efficiencies to achieve cost reductions so to have a competitive edge over the competitors.

Optimal Utilization of Resources

The Company constantly endeavors to improve the service process, and will increase manufacturing process to optimize the utilization of resources. The Company has invested significant resources, and intend to further invest in the activities to develop customized systems and processes to ensure effective management control.

Continue to build-up a professional organization

The Company has a team of professionals to look after production, commercial and marketing divisions of the Company. The Company believes in transparency, flow of information, and commitment to the work among the work force and with the valuable customers, suppliers, investors, government authorities, banks, financial institutions etc.

Business Strategy


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Quality Products The Company believes in providing the customers the best possible quality products. The scale of operations and experience of the Promoters in the business enables the Company to produce quality products.

Facility for In-house production of raw

materials

The Promoter Mr. Bhavan Dhirendra Vora, is engaged in manufacturing business, which also form part of Board of Directors of The Company, have a proven background and rich experience of more than 20 years in the industry. Also, The Company is managed by a team of experienced personnel.

Management Expertise

The Company has in-house facility for production of raw materials required to manufacture Lacquered (Coated) Metalized Polyester Film (LMPF).

Existing relationship with suppliers

The Company has acquired raw materials from several suppliers and has contacts with them for a long time. The company believes that the strong relationships with suppliers will enable the company to continue to grow the business.

Existing customer relationship

The existing customer relationships help the company to get repeat business from the customers. This has helped the company maintain a long term working relationship with the customers and improve the customer retention strategy.

Competitive Strengths


Awards & Recognition 9

Certificate for Best MSME Award 2011 by Government of Gujarat (Industries & Mines Department) for Outstanding Performance in Growth in Production & Profit in the Category of Medium Enterprise for manufacturing of Lacquered Polyester

Film & Metalized Polyester Film.

SKOCH Order of Merit Certificate for Qualifying Amongst India’s Best SMEs – 2014, given on 21st March, 2014, at New Delhi.

Certificate from Federal Bank Ltd. and Dun & Bradstreet India for being featured in “Dun & Bradstreet’s premier publication” as “Leading SME of India 2014”.

Certificate of Excellence from Small & Medium Business Development Chamber of India (SME Chamber of India) in recognition of exemplary achievement in “Manufacturing Sector”, given on 16th September, 2014 at Mumbai.

Bank of India (BOI) India SME – 100 Award for 2013 year.

Additionally, the Company has also been shortlisted and found deserving of the honour of being India’s Small Giants – Emerging. Entrepreneurs of India, which is an initiative of India SME Forum and NDTV Profit.

Axis SME 100 Award for 2015


Strong Management Team

Mr. Sanjeev Manickchand Rakhecha

• Current Position

Chairman & non Executive Independent Director

• Experience

Mr. Sanjeev Manickchand Rakhecha possesses 10 years of experience in the field of exports and marketing.

Mr. Bhavan Dhirendra Vora

• Current Position

Managing Director

• Experience

Mr. Bhavan Dhirendra Vora has played a major role in introducing the company’s products to foreign countries by way of Exports and has maintained cordial relationships with national as well as with the foreign Customers. He is responsible for ensuing that appropriate governance procedures are in place and well entrenched in the culture of the Company.

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Industry Outlook

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Plastics Industry in India

The Indian plastics industry offers excellent potential in terms of capacity, infrastructure and cheap labour availability. It is supported by a large number of polymer producers, and plastic process machinery and mould manufacturers in the country. Among the industry’s major strengths is the availability of raw materials in the country. Thus, plastic processors do not have to depend on imports. These raw materials, including polypropylene, high-density polyethylene, low-density polyethylene and PVC, are manufactured domestically.

Packaging Industry

The future for the Indian textile industry looks promising, buoyed by both strong domestic consumption as well as export demand. With consumerism and disposable income on the rise, the retail sector has experienced a rapid growth in the past decade with the entry of several international players like Marks & Spencer, Guess and Next into the Indian market. The organised apparel segment is expected to grow at a Compound Annual Growth Rate (CAGR) of more than 13 per cent over a 10-year period.

Indian Textile Industry

Various upgraded technologies are being used in industry such as aseptic packaging, retort packaging and biodegradable packaging to enhance the life of food product. The packaging industry is poised to grow rapidly led by increasing use of the innovative packaging equipments and the rising flexible packaging market.


Competitors Analysis

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Name of company RoNW (%) EPS (Rs.) P/E Ratio

Advance Syntex Limited 8.73 1.08 11.08

Lakhotia Polyesters (India) Limited 1.06 0.11 80.64

Jindal Poly Films Limited 11.3 37.6 9.6

Uflex Limited 6.8 14.8 8.9

Advance Syntex Limited Lakhotia Polyesters (India)

Limited Jindal Poly Films Limited Uflex Limited

RoNW (%) 8.73 1.06 11.3 6.8

EPS (Rs.) 1.08 0.11 37.6 14.8

P/E Ratio 11.08 80.64 9.6 8.9

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Comparision with peers


Financial Performance

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Particulars

For Nine month

ended December

31, 2015

For Year Ended 31st March

2015 2014 2013

Net Sales 363,423,893 494,197,231 389,584,491 319,638,343

Other Income 4,637,408 3,199,878 747,654 1,300,687

Total Income 344,946,548 475,372,446 362,220,756 297,680,023

Total Expenditure 285,189,044 424,746,614 329,105,096 268,377,266

PBIDT 59,757,505 50,625,832 33,115,660 29,302,757

Interest 29,218,784 24,851,762 17,358,696 13,484,403

PBDT 30,538,720 25,774,070 15,756,964 15,818,354

Depreciation 16,340,123 23,502,022 4,265,912 3,910,233

PBT 14,198,597 2,272,048 11,491,052 11,908,121

Tax 6,369,050 432,939 2,299,100 2,382,547

Deferred Tax -1,263,824 -4,656,469 882,331 1,101,811

Provision for earlier years 109,300 374,785 0 0

Reported PAT 8,909,072 6,120,793 8,309,621 8,423,763


Balance Sheet

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Particulars For Nine month ended December

31, 2015

For Year Ended 31st March

2015 2014 2013

LIABILITIES

Share Capital 58,146,600 38,764,400 34,860,100 28,760,100

Reserves & Surplus 20,880,496 31,353,624 25,232,831 16,923,210

Share Application Money Pending

Allotment

3,384,300

Net worth 79,027,096 70,118,024 63,477,231 45,683,310

Non Current Liabilities 79,791,736 72,133,175 50,129,730 54,245,107

Long-Term Borrowings 74,696,601 65,810,969 39,201,721 44,358,360

Deferred Tax liability 4,752,005 6,015,825 10,672,294 9,789,963

Long term provisions 0 0 0 0

Other Long Term Liabilities 343,130 306,381 255,715 96,784

Current Liabilities 270,867,120 204,707,729 173,778,626 137,223,464

Total Liabilities 429,685,952 346,958,928 287,385,587 237,151,882

ASSETS

Non Current Assets 92,583,303 96,445,701 84,927,592 78,141,908

Fixed Assets 89,401,349 95,009,701 83,491,592 76,705,908

Other Non-Current Assets 3,181,954 1,436,000 1,436,000 1,436,000

Current Assets 337,102,649 250,513,227 202,457,995 159,009,974

Total Assets 429,685,952 346,958,928 287,385,587 237,151,882


Financial Ratio’s

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Particulars

For Nine month ended

December 31, 2015

For Year Ended 31st

March

2015 2014 2013

Return on Average Assets (%) 2.29 1.93 3.17 4

Return on Average Net worth (%) 11.95 9.4 15.71 22.64

Average Debt/Average Net worth 2.88 2.42 2.5 3.36

Average Net worth as a percentage of

Average Total Assets (%)

19.2 20.53 20.17 17.65

Basic Earnings per share 1.53 1.58 2.38 2.93

Diluted Earnings per share 1.58 1.08 1.8 2.43

Book Value per share 13.59 18.09 17.24 15.88


Financial Performance

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FY 2015 FY 2014 FY 2013

Total Revenue 4753.72446 3622.20756 2976.80023

Restated profit for the year 61.20793203 83.09620748 84.23763259

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Financial Performance (In Rs. Lacs)


Financial Summary

Revenue

Earnings before Interest, Tax, Depreciation & Amortization (EBITDA)

Net Worth

24%

31%

24%

CAGR (2 Years FY 13 – FY 15)

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THANK YOU

14/15, 1st Floor, Khatau Bldg., 40, Bank Street, Fort, Mumbai - 01

Tel: +91 - 22 – 4906 0060 Email ID: [email protected]

Website: www.hemonline.com

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233/2 & 238/2 GIDC, POR Ramangamdi, Vadodara-391243, Gujarat, India Tel No: +91- 265- 2831850 E-mail: [email protected] Website: www.midasglitter.com

mailto:[email protected]

http://www.hemonline.com/

mailto:[email protected]

http://www.midasglitter.com/

Investors Presentation: Hem Securities Limited

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