Textile Reuttyutyport-2015 (1)

A

PROJECT REPORT

ON

INDIAN TEXTILE INDUSTRY

MASTER OF MANAGEMENT STUDIES (MMS)

UNIVERSITY OF MUMBAI

SUBMITTED TOAnjuman-I-Islam’s Allana Institute of Management Studies

Mumbai-400001.

UNDER THE GUIDANCE OF

PROF.CHINMAY CHOPDE

SUBMITTED BY

DEEPTI HARIOM GUPTA - 13

TANVEER MUKUDAM - 25

OVERVIEW OF INDIAN TEXTILE INDUSTRY

Background

India Textile Industry is one of the leading textile industries in the world. Though was predominantly unorganized industry even a few years back, but the scenario started changing after the economic liberalization of Indian economy in 1991. The opening up of economy gave the much-needed thrust to the Indian textile industry, which has now successfully become one of the largest in the world.

India textile industry largely depends upon the textile manufacturing and export. It also plays a major role in the economy of the country. India earns about 27% of its total foreign exchange through textile exports. Further, the textile industry of India also contributes nearly 14% of the total industrial production of the country. It also contributes around 3% to the GDP of the country. India textile industry is also the largest in the country in terms of employment generation. It not only generates jobs in its own industry, but also opens up scopes for the other ancillary sectors. India textile industry currently generates employment to more than 35 million people.

Indian textile industry can be divided into several segments, some of which can be listed as below: Cotton Textiles Silk Textiles Woolen Textiles Readymade Garments Hand-crafted Textiles Jute and Coir.

CURRENT SCENARIO

The Indian textiles industry, currently estimated at around US $108 billion, is expected to reach US $ 141 billion by 2021. The industry is the second largest employer after agriculture, providing direct employment to over 45 million and 60 million people indirectly.

The Indian Textile Industry contributes approximately 5 per cent to GDP, and 14 per cent to overall Index of Industrial Production (IIP).The Indian textile industry has the potential to grow five-fold over the next ten years to touch US$ 500 billion mark on the back of growing demand for polyester fabric, according to a study by Wazir Advisors and PCI Xylenes and Polyester. The US$ 500 billion market figure consists of domestic sales of US$ 315 billion and exports of US$ 185 billion. The current industry size comprises domestic market of US$ 68 billion and exports of US$ 40 billion, according to Mr Prashat Agarwal, Managing Director, Wazir Advisors.Apparel exports from India have registered a growth of 17.6 per cent in the period April—September 2014 over the same period in the previous financial year.

Readymade garments and cotton textiles dominate textile exports• Readymade garments was the largest contributor to total textile and apparel exports from India in FY15 • The segment had a share of 40 per cent in overall textile exports • Cotton and man-made textiles were also major contributors with shares of 31 per cent and 16 per cent, respectively .

The textile and apparel industry can be broadly divided into two segments - yarn and fibre, and processed fabrics and apparel. India accounts for ~14 per cent of the world's production of textile fibres and yarns (largest producer of jute, second largest producer of silk and cotton, and third largest in cellulosic fibre). India has the highest loom capacity (including hand looms) with 63 per cent of the world's market share. 

The domestic textile and apparel industry in India is estimated to reach US$ 141 billion by 2021 from US$ 67 billion in 2014. Increased penetration of organised retail, favourable demographics, and rising income levels are likely to drive demand for textiles.India is the world's second largest exporter of textiles and clothing. 

Textile and apparel exports from India are expected to increase to US$ 82 billion by 2021 from US$ 40 billion in 2014. Readymade garments remain the largest contributor to total textile and apparel exports from India. In FY15 the segment had a share of 40 per cent of all textile and apparel exports. Cotton and man-made textiles were the other major contributors with shares of 31 per cent and 16 per cent, respectively.Rising government focus and favourable policies is leading to growth in the textiles and clothing industry. Foreign direct investment (FDI) in textile sector increased to US$ 1,587.8 million in FY15 from US$ 1,424.9 million in FY14.

KEY PROVISIONS OF BUDGET 2O14-15

Allocation of INR 500 Million towards the setting up of a trade facilitation centre and a crafts museum to develop and promote handloom products and carry forward the rich tradition of the handlooms of Varanasi.

Allocation of INR 2000 Million towards the proposed setting up of mega textile clusters at Bareilly, Lucknow, Surat, Kuttch, Bhagalpur and Mysore and one in Tamil Nadu.

Allocation of INR 300 Million towards the setting up of Hastkala Academy for the preservation, revival and documentation of the handloom/handicraft sector in PPP mode in Delhi.

Allocation of INR 500 Million towards the setting up of Pashmina Promotion Programme (P-3) and a programme for the development of other crafts of Jammu & Kashmir.

The duty-free entitlement for import of trimmings and embellishments used by the readymade textile garment sector for manufacture of garments for exports is being increased from 3% to 5%.

Non-fusible embroidery motifs or prints are being included in the list of items eligible to be imported duty-free for manufacture of garments for exports.

The list of specified goods required by handicraft manufacturer-exporters is being expanded by including wire rolls so as to provide customs duty exemption on import by handicrafts manufacturer-exporters.

Fusible embroidery motifs or prints, anti-theft devices, pin bullets for packing, plastic tag bullets, metal tabs, bows, ring and slider hand rings are being included in the list of items eligible to be imported duty-free for manufacture of handloom made ups or cotton made ups or manmade made ups for export.

Specified goods imported for use in the manufacture of textile garments for export are fully exempt from Basic Customs Duty (BCD) and Countervailing Duty (CVD) subject to conditions that the manufacturer produces an entitlement certificate from the Apparel Export Promotion Council or from the Indian Silk Export Promotion Council.

Basic Customs Duty (BCD) on raw materials for manufacture of spandex yarn viz. polytetramethylene ether glycol and diphenylmethane 4,4 di-isocyanate is being reduced from 5% to NIL.

TAX INCENTIVES:

R&D Incentives: Industry/private-sponsored research programmes:

A weighted tax deduction is given under Section 35 (2AA) of the Income Tax Act.

A weighted deduction of 200% is granted to assesses for any sums paid to a national laboratory, university or institute of technology, or specified persons with a specific direction that the said sum would be used for scientific research within a program approved by the prescribed authority.

COMPANIES ENGAGED IN MANUFACTURE HAVING AN IN-HOUSE R&D CENTRE:

A weighted tax deduction of 200% under Section 35 (2AB) of the Income Tax Act for both capital and revenue expenditure incurred on scientific research and development. Expenditure on land and buildings are not eligible for deductions.

STATE INCENTIVES:

Apart from the above, each state in India offers additional incentives for industrial projects. Some of the states also have separate policies for the textiles sector.

Incentives are in areas like subsidised land cost, relaxation in stamp duty exemption on sale/lease of land, power tariff incentives, concessional rates of interest on loans, investment subsidies/tax incentives, backward areas subsidies and special incentive packages for mega projects.

EXPORT INCENTIVES:

Export Promotion Capital Goods Scheme (PCGS). Duty Remission Scheme. Focus Product Scheme, Special Focus Product Scheme, Focus Market Scheme.

INVESTMENTS AND OPPORTUNITIES

The textiles sector has witnessed a spurt in investment during the last five years. The industry (including dyed and printed) attracted foreign direct investment (FDI) worth US$ 1,522.51 million during April 2000 to December 2014.Some of the major investments in the Indian textiles industry are as follows:

• Reliance Industries Ltd (RIL) plans to enter into a joint venture (JV) with China-based Shandong Ruyi Science and Technology Group Co. The JV will leverage RIL's existing textile business and distribution network in India and Ruyi's state-of-the-art technology and its global reach.

• Giving Indian sarees a ‘green’ touch, Dupont has joined hands with RIL and Vipul Sarees for use of its renewable fibre product Sorona to make an ‘environment-friendly’ version of this ethnic ladieswear.

• Raymond has launched ‘Regio Italia’, a luxurious, elite and finest Italian fabric for its customers. Regio Italia is a fine collection of fabrics from Italy with the latest designs that is carefully woven and specially handpicked assortment of the best designs in formal and occasion menswear suiting fabrics.

• Snapdeal has partnered with India Post to jointly work on bringing thousands of weavers and artisans from Varanasi through its website. “This is an endeavour by Snapdeal and India Post to empower local artisans, small and medium entrepreneurs to sustain their livelihood by providing a platform to popularise their indigenous products,” said Mr Kunal Bahl, CEO and Co-Founder, Snapdeal.

• Welspun India Ltd (WIL), part of the Welspun Group has unveiled its new spinning facility at Anjar, Gujarat - the largest under one roof in India. The expansion project reflects the ethos of the Government of Gujarat’s recent ‘Farm-Factory-Fabric-Fashion-Foreign’ Textile Policy, which is aimed at strengthening the entire textile value.

GLOBAL FACTORS INFLUENCING TEXTILE INDUSTRY

The history of the textile and clothing industry has been replete with the use of various bilateral quotas, protectionist policies, discriminatory tariffs, etc. by the developed world against the developing countries. The result was a highly distorted structure, which imposed hidden costs on the export sectors of the Third World. Despite the fact that GATT was established way back in 1947, the textile industry, till 1994, remained largely out of its liberalisation agreements. In fact, trade in this sector, until the Uruguay Round, evolved in the opposite direction. Consequently, since 1974 global trade in the textiles and clothing sector had been governed by the Multi-fibre agreement, which was the sequel to an increasingly pervasive quota regime that began with the Short-term arrangement on cotton products in 1962 and followed by the Long-Term arrangement. After the successful conclusion of the Uruguay Round in 1994, the MFA was replaced by the Agreement on Textiles and Clothing (ATC), which had the same MFA framework in the context of an agreed, ten year phasing out of all quotas by the year 2005.

Some of the other factors which affect textile industry are as follows:

Demand condition : The more the demand for the textiles, the more will be the production and the better it will be for the economy and vice versa.

Cost and location : It plays an important role in the profitability of the firm. If the raw material is available near the factory the cost of transportation will not be there and it will be more profitable for the firm

Rivalry: Competition exists in every sector. Higher the competition in the market more will be the pressure on the company to perform and provide quality product and services to survive in the market.

Government regulation: higher the tariffs and trade barriers lesser will be the growth of the company and the economy viceversa.

SOME OF THE MAJOR PLAYERS IN TEXTILE INDUSTRY ARE:

• Vardhaman textiles

• Arvind mills

• Bombay dyeing

• Raymond's

• Grasim industries

• Reliance textiles

• ITC lifestyles

• Mafatlal industries ltd

• Alok Industries ltd

RAYMONDS

IntroductionIncorporated in 1925, Raymond Group is one of India's largest branded fabric and fashion retailers. It is one of the leading, integrated producers of suiting fabric in the world, with a capacity of producing 31 million meters of wool & wool-blended fabrics.Gautam Singhania is the chairman and managing director of the Raymond group.

The Group owns apparel brands like Raymond, Raymond Premium Apparel, Park Avenue, Park Avenue Woman ColorPlus & Parx. All the brands are retailed through 'The Raymond Shop' (TRS) – One of the largest network of over 700 retail shops spread across India and overseas, in over 200 cities.

In addition, the Group also has business interests in readymade garments, designer wear, cosmetics & toiletries, engineering files and tools, prophylactics and air charter operations.

Today, the Raymond group is vertically and horizontally integrated to provide customers total textile solutions. Few companies globally have such a diverse product range of nearly 20,000 varieties of worsted suiting to cater to customers across age groups, occasions and styles.

We manufacture for the world the finest fabrics - from wool to wool-blended worsted suiting to specialty ring denims as well as high value shirting.

After making a mark in textiles, Raymond forayed into garmenting through highly successful ventures like Silver Spark Apparel Ltd., EverBlue Apparel Ltd. (Jeanswear) and Celebrations Apparel Ltd (Shirts).

We also have some of the most highly respected fabric and apparel brands in our portfolio: Raymond, Raymond (Ready-To-Wear), Park Avenue, ColorPlus, Parx, Makersand Notting Hill.

The Raymond Group also has an expansive retail presence established through the exclusive chain of 'The Raymond Shop' and stand-alone brand stores.

They are today one of the largest players in fabrics, designer wear, denim, cosmetics & toiletries, engineering files & tools, prophylactics and air charter services in national and international market

GROUP COMPANIES

Raymond Ltd.

Raymond Ltd. is among the largest integrated manufacturers of worsted fabrics in the world.

Raymond Apparel Ltd.

Raymond Apparel Ltd. has in its folio some of the most highly regarded apparel brands in India – Raymond (Ready-To-Wear), Park Avenue, Parx and Notting Hill.

ColorPlus Fashions Ltd.

ColorPlus is among the largest smart casual brands in the premium category. The company was acquired by Raymond to cater to the growing demand for a high end, casual wear brand in the country for Men & Women.

Silver Spark Apparel Ltd.

A garmenting facility that manufactures formal suits, trousers and jackets.

We manufacture for the world the finest fabrics - from wool to wool-blended worsted suiting to specialty ring denims as well as high value shirting.

• Celebrations Apparel Ltd. A facility set-up for the manufacture of formal shirts.

• Raymond Luxury Cottons Ltd.

A Greenfield facility manufacturing high value cotton shirting.

• J.K. Helene Curtis Ltd .

A leading player in the grooming, accessories and toiletries category.

SWOT ANALYSIS

The SWOT analysis and company profile is a crucial resource for industry executives and anyone looking to gain a better understanding of the company's business. The SWOT analysis of the company is as follows:

STRENGTH

1. Strong research and development for product and innovations.2. Loyalty of customers and high product quality.3. Loyalty of employees due to decentralization.4. Owns 550 stores in more 200 cities across India and overseas.

5. People trust on products and high brand loyalty.

6 Being a multinational company it has the ability to attract more customers than local companies.7. Good advertising and popular branding through TVCs and print ad campaigns.

WEAKNESS1. Global penetration is limited as compared to a few other international brands2. Presence of Indian and international brands offers more offering to customers therefore high brand switching.

OPPORTUNITY1. Consistent growth over years.2.Large and growing market.3. Global expansion would give more opportunities for brand to grow.

THREATS1. All major players in the industry are competing with each other not only on low price but also better quality.2. Regional trade alliances.3. Increased social and ecological awareness will put pressure on company to follow international labor laws and environmental laws.

PEST ANALYSIS

PEST analysis (“Political, Economic, Social and Technological analysis”) describes a framework of macro-environmental factors used in the environmental scanning component of strategic management.It is a part of the external analysis when conducting a strategic analysis or doing market research, and gives an overview of the different macro-environmental factors that the company has to take into consideration. It is a useful strategic tool for understanding market growth or decline, business position, potential and direction for operations.

POLITICAL• The Government has announced the release of a subsidy of US$ 533.87

million for the textile industry.• Removal of trade related tariffs and non-tariff barriers in 2005• The government has extended 10% capital subsidy and 5% interest subsidy

on installation of machineries and for processing machinery.• A 41-member Working Group has also been announced to be set up with a

National Fiber Policy, to ensure self-sufficiency in fiber consumption and export requirements in India.

ECONOMIC• Indian textile industry contributes about 14% to industrial production, 4% to

the country's gross domestic product (GDP) and 16.63% to export earnings.• Nearly 40% of the textiles produced in the country is exported and the

textiles sector is the biggest employment generator after agriculture• The sector is expected to generate 12 million new jobs• Indian textiles and apparel exports, which is worth US$ 22 billion, is

expected to register a four-fold increase to touch US$ 90 to 100 billion in the next 25 years

SOCIAL• The market for textile is growing as a whole as India’s population grows at

about 1-2% annually.• Along with that, Raymond’s market segment of upper middle class and the

high class segment is also growing due to higher disposable incomes.

• The textile industry is mainly a labor intensive industry as it provides livelihood to the huge population, mainly consists of unskilled workers, and thus plays a pivotal role in the development of any economy.

TECHNOLOGICAL• Since the textile industry is more labour intensive, technological factors do

not affect it too much, however since the government extends 10% capital subsidy and 5% interest subsidy on installation of machineries and for processing machinery under the TUFS, the textile industry can easily make advancements in technology if it needs to.

• Basic advancements in technology for the textile industry include improvements in machinery for computerized flat knitting and embroidering.

CORPORATE GOVERNANCE Raymond Limited (‘The Company’) considers Corporate Governance as an integral part of good management. The Company has adopted a Code of Business Conduct & Ethics (‘the Code’).This Code is applicable to the Board of Directors and all Employees of the Company.Each Director and Employee must comply with the letter and spirit of this Code.

• COMPALIANCE WITH LAW.

• ETHICAL CONDUCT.

• CONFLICT OF INTEREST .

• FAIR DEALINGS.

• GIFT AND BUSINESS ENTERTAINMENT.

• EQUAL OPPORTUNITIES.

• CORPORATE SOCIAL RESPONSIBILITY ,HEALTH & SAFETY.

• ENVIRONMENTAL PROTECTION.

• ENCOURING AND REPORTING OF UNETHICAL BEHAVIOUR.

• INSIDER TRADING.

• REVIEW AND MODIFICATION.

FINANCIAL POSITON OF THE COMPANY

FINANCIAL PERFORMANCE Amid optimism and rising business sentiments, the Company reported a top-line growth of 21% over the Previous Year. At Standalone level, the Gross Revenue from operations stood at Rs. 2645.47 crore compared with Rs. 2185.91 crore in the Previous Year. The Operating Profit before tax stood at Rs. 111.58 crore as against Rs. 64.61 crore in the Previous Year. The Net Profit for the year stood at Rs. 100.00 crore against Rs.

88.12 crore reported in the Previous Year. The Consolidated Gross Revenue from operations for FY 2015 was placed atRs. 5374.54crore (Previous Year: Rs. 4593.74 crore), registering a growth of 17%. The Consolidated Operating Profit stood atRs. 159.72 crore (Previous Year: Rs. 160 crore). The Consolidated Profit after tax stood at Rs. 112.81 crore (Previous Year: Rs. 107.63 crore). DIVIDEND AND RESERVES The Directors recommend a dividend of 30% i.e. Rs. 3 per equity share of face value of Rs. 10 each aggregating to Rs. 18.41 crore (Previous Year: Rs. 12.28 crore). During the year under review, the Company transferred a sum of Rs. 43.75 crore to the Debenture Redemption Reserve (Previous Year: Rs. 45 crore). During the year under review, no amount was transferred to GeneralReserve. SHARE CAPITAL The paid up Equity Share Capital as at March 31, 2015 stood at Rs. 61.38 crore. During the year under review, the Company has not issued shares with differential voting rights nor has granted any stock options or sweat equity. As on March 31, 2015, none of the Directors of the Company hold instruments convertible into equity shares of the Company. ANALYSIS AND REVIEW The Textile and Apparel industry contributes around 6% to India''s GDP, 11% to export earnings and is the second largest employer (-whopping 55 million people) after agriculture. The industry has shown continued growth with a potential to increase its global trade share from the current 4.5% to 8% (USD 80 Billion) in the next 5 years supported by a rich abundance of raw material, skilled labour and talent. In FY 2015, the textile industry is estimated to have contributed USD 42 Billion (4%) to India''s GDP, and 27% to the country''s foreign exchange inflows.

PERFORMANCE HIGHLIGHTS During FY 2015, your Company's total Textile sales registered a growth of 24%, Net Revenue being Rs. 2538.66 crore as against Rs.2051.29 crore in

FY 2014. The increase in sales was led by volume growth in domestic and Export market and deeper penetration of shirting fabric market. RAW MATERIAL Major raw material prices, namely Wool, Polyester Staple Fibre, Viscose Staple Fibre and Polymers were soft during the year, largely because of steady international prices and a stable Rupee. Multiple internal raw material cost saving initiatives have also helped in keeping costs in control. RETAIL NETWORK PRESENCE Your Company was judicious in its Retail expansion plans. The Retail network now covers a large number of Tier 4 and 5 cities. As on March 31, 2015 your Company had 1003 retail stores (including 43 overseas stores) across all formats.This includes TRS (The Raymond Shop), EBO (The Exclusive Brand Outlet) and Made-to-Measure (MTM).

Mar '15 Mar '14 Mar '13 Mar '12

12 mths 12 mths 12 mths 12 mths 12 mths

Sources Of FundsTotal Share Capital 61.38 61.38 61.38 61.38 61.38

Equity Share Capital 61.38 61.38 61.38 61.38 61.38

Share Application Money 0.00 0.00 0.00 0.00 0.00

Preference Share Capital 0.00 0.00 0.00 0.00 0.00

Reserves 1,106.38 1,039.40 969.58 1,042.92 1,004.20

Networth 1,167.76 1,100.78 1,030.96 1,104.30 1,065.58Secured Loans 535.64 661.65 656.09 637.30 733.07

Unsecured Loans 555.00 577.09 350.00 363.27 352.85

Total Debt 1,090.64 1,238.74 1,006.09 1,000.57 1,085.92Total Liabilities 2,258.40 2,339.52 2,037.05 2,104.87 2,151.50

Mar '15 Mar '14 Mar '13 Mar '12 Mar '11

12 mths 12 mths 12 mths 12 mths 12 mths

Application Of FundsGross Block 1,813.09 1,784.71 1,846.34 1,805.76 1,708.72

Less: Revaluation Reserves 0.00 0.00 0.00 0.00 0.00

Less: Accum. Depreciation 1,201.66 1,110.93 1,012.06 938.54 850.98

Net Block 611.43 673.78 834.28 867.22 857.74Capital Work in Progress 167.40 157.72 144.88 116.55 77.39

Investments 708.68 770.18 744.85 777.30 740.13Inventories 576.66 551.86 502.99 447.67 413.09

Sundry Debtors 569.81 480.45 416.26 392.40 320.46

Cash and Bank Balance 95.46 51.58 18.25 12.86 15.51

Total Current Assets 1,241.93 1,083.89 937.50 852.93 749.06

Loans and Advances 453.88 355.62 359.61 336.89 385.34

Fixed Deposits 0.00 0.00 0.00 0.00 0.00

Total CA, Loans & Advances 1,695.81 1,439.51 1,297.11 1,189.82 1,134.40

Deferred Credit 0.00 0.00 0.00 0.00 0.00

Current Liabilities 874.97 657.87 936.16 781.53 613.47

Provisions 49.92 43.78 47.89 64.47 44.68

Total CL & Provisions 924.89 701.65 984.05 846.00 658.15

Net Current Assets 770.92 737.86 313.06 343.82 476.25Miscellaneous Expenses 0.00 0.00 0.00 0.00 0.00

Total Assets 2,258.43 2,339.54 2,037.07 2,104.89 2,151.51

Contingent Liabilities 260.20 256.49 260.61 255.52 331.00

Book Value (Rs) 190.25 179.34 167.96 179.91 173.60

Balancesheet

Grasim Industries Limited

It is a flagship company of the Aditya Birla Group, ranks amongst India's largest private sector companies, with a consolidated net revenue of Rs.293 billion and consolidated net profit of Rs.21 billion (FY 2014).

Grasim started as a textile manufacturer in 1948. Today its core businesses are Viscose Staple Fibre (VSF) and Cement, contributing over 90 per cent of its revenues and operating profits. It is also present in

Chemicals which is essentially a backward integration of VSF.

The Aditya Birla Group is the world’s leading producer of VSF, commanding a 16 per cent global market share. Grasim, with an aggregate capacity of 498 ktpa has a global market share of 8 per cent. It is also the largest player in India in Chlor Alkali with Caustic capacity of 452K TPA (which is used in the production of VSF) in India.

Grasim entered into Cement business in 1985 with a capacity of 0.5 million tpa. Over the years, through organic and inorganic expansions, the business has grown multifold. Currently, Grasim’s subsidiary UltraTech Cement Limited ("UltraTech") has a capacity of 63.15 million tpa. Earlier, in July 2004, Grasim acquired a majority stake and management control in UltraTech. One of the largest-of-its-kind in the cement sector, this acquisition catapulted Grasim to the top of the league in India. Subsequently, Grasim demerged its cement business into UltraTech in July 2010. The merger has created the largest cement company in India, providing a platform that will help in pursuing aggressive growth going forward. 

Grasim is implementing ambitious growth plans through capacity expansions in VSF and Cement, which will further consolidate its leadership in both the businesses.

Share Holding Pattern

Category code

Category of shareholder

Number of shareholders

Total number of shares

Number of shares held in dematerialized form

Total shareholding as a percentage of total number of shares

Shares Pledged or otherwise encumbered

As a percenta

ge of

As a percentage of

Number of Shares

As a Percentage

(A+B)[1] (A+B+C)

(I) (II) (III) (IV) (V) (VI) (VII)(VIII)

(IX)= (VIII)/(IV)*1

00

(A) Shareholding of Promoter and Promoter Group[2]

(1) Indian

(a) Individuals/ Hindu Undivided Family

5 133372

133372 0.17 0.150 0

(b) Central Government/ State Government(s)

(c) Bodies Corporate

17 23296096

23296096 29.55 25.36 0 0

(d) Financial Institutions/ Banks

(e) Any Others (Specify)Sub-Total (A)(1)

22 23429468

23429468 29.72 25.50 0 0

(2) Foreign

(a) Individuals (Non-Resident Individuals/ Foreign Individuals)

(b) Bodies Corporate

(c) Institutions

(d) Qualified Foreign Investor

(e) Any Other (specify)Sub-Total (A)(2)

Total Shareholdi

22 23429468

23429468 29.72 25.50 0 0

ng of Promoter and Promoter Group (A)= (A)(1)+(A)(2)

(B) Public shareholding[3]

N.A.

(1) Institutions N.A. N.A.

(a) Mutual Funds/ UTI

185 7276646

7268668 9.23 7.92

(b) Financial Institutions/ Banks

73 225178

212642 0.29 0.25

(c) Central Government/ State Government(s)

(d) Venture Capital Funds

(e) Insurance Companies

42 8446372

8442886 10.71 9.19

(f) Foreign Institutional Investors

206 20918792

20917201 26.53 22.77

(g) Foreign Venture Capital Investors

0 0 0 0.00 0.00

(h) Qualified Foreign Investor

(i) Any Other (Specify)

0 0 0 0.00 0.00

Sub-Total (B)(1)

506 36866988

36841397 46.76 40.13

(2) Non-institutions N.A. N.A.

(a) Bodies Corporate

1461 6416147

6342463 8.14 6.98

(b) Individuals -

I Individual shareholders holding

127496 8186957

6600410 10.38 8.91

nominal share capital up to Rs. 1 lakh.

II Individual shareholders holding nominal share capital in excess of Rs. 1 lakh.

19 729040

729040 0.92 0.79

(c) Qualified Foreign Investor

(d)(i) Any other- Overseas Body Corporate (OCBs)

7 2622613

0 0.33 2.85

(d)(ii) Any Other- Non Resident Indian (NRIs)

4130 588517

367251 0.75 0.64

Sub-Total (B)(2)

13313 18543274

14039164 23.52 20.18

Total Public Shareholding (B)= (B)(1)+(B)(2)

133619 55410262

50880561 70.28 60.32

N.A. N.A.

TOTAL (A)+(B)

133641 78839730

74310029 100.00 85.82

(C) Shares held by Custodians and against which Depository Receipts have been issued*

N.A. N.A.

1 Promoter and Promoter Group*

- 4802304

4802304 xxx 5.23

2 Public 1 8224615

8224615 xxx 8.95

TOTAL (C) 1 13026919

13026769 xxx 14.18

GRAND TOTAL (A)+(B)+(C)

133642 91866649

87336798 xxx 100.000 0

Swot Analysis

STRENGTH

The company is a subsidiary of Aditya Birla Group, which operates over 40 companies in 12 countries

It is the world's second largest producer of viscose rayon fiber.

Strong brand equity of Aditya Birla Group.

WEAKNESS

Grasim industries have fluctuating sales which can affect profitability.

Input costs have risen which has resulted in reduced profits.

OPPORTUNITY

Grasim Industries should focus on increasing branding activities, this can result into higher sales.

It can expand its operations to other countries.

THREAT

Grasim Industries is facing a huge competition from other key players in the respected segments.

Cheaper local brands are increasing their hold in the country.

Balance sheet

Balance Sheet of Grasim Industries ------------------- in Rs. Cr. -------------------

Mar '15 Mar '14 Mar '13 Mar '12 Mar '11

12 mths 12 mths 12 mths 12 mths 12 mths

Sources Of FundsTotal Share Capital 91.87 91.83 91.78 91.71 91.70

Equity Share Capital 91.87 91.83 91.78 91.71 91.70

Share Application Money 0.01 0.01 0.01 0.01 0.01

Preference Share Capital 0.00 0.00 0.00 0.00 0.00

Reserves 11,091.05 10,735.74 10,030.07 9,007.67 8,042.02

Networth 11,182.93 10,827.58 10,121.86 9,099.39 8,133.73

Secured Loans 839.79 1,058.29 1,022.78 548.71 445.13

Unsecured Loans 90.95 73.25 148.96 81.63 104.61

Total Debt 930.74 1,131.54 1,171.74 630.34 549.74

Total Liabilities 12,113.67 11,959.12 11,293.60 9,729.73 8,683.47

Mar '15 Mar '14 Mar '13 Mar '12 Mar '11

12 mths 12 mths 12 mths 12 mths 12 mths

Application Of FundsGross Block 7,323.14 5,438.92 3,754.53 3,108.00 2,976.80

Less: Revaluation Reserves 0.00 0.00 0.00 0.00 0.00

Less: Accum. Depreciation 2,135.60 1,891.18 1,682.57 1,559.47 1,434.99

Net Block 5,187.54 3,547.74 2,071.96 1,548.53 1,541.81Capital Work in Progress 450.36 1,807.45 2,425.09 476.94 56.53

Investments 5,350.34 5,603.64 6,224.43 6,829.74 6,910.25Inventories 1,433.15 1,212.27 789.34 630.91 421.65

Sundry Debtors 687.49 613.79 516.63 509.23 455.63

Cash and Bank Balance 53.19 26.30 16.27 11.02 14.65

Total Current Assets 2,173.83 1,852.36 1,322.24 1,151.16 891.93

Loans and Advances 1,205.14 1,066.46 1,008.05 1,029.70 606.08

Fixed Deposits 0.00 0.00 0.00 0.00 0.00

Total CA, Loans & Advances 3,378.97 2,918.82 2,330.29 2,180.86 1,498.01

Deferred Credit 0.00 0.00 0.00 0.00 0.00

Current Liabilities 1,750.13 1,410.03 1,242.16 836.47 864.71

Provisions 503.41 508.50 516.01 469.87 458.42

Total CL & Provisions 2,253.54 1,918.53 1,758.17 1,306.34 1,323.13

Net Current Assets 1,125.43 1,000.29 572.12 874.52 174.88Miscellaneous Expenses 0.00 0.00 0.00 0.00 0.00

Total Assets 12,113.67 11,959.12 11,293.60 9,729.73 8,683.47

Contingent Liabilities 751.52 806.82 688.79 1,912.68 889.05

Book Value (Rs) 1,217.49 1,179.13 1,102.88 992.19 887.00

Profit and Loss

Profit & Loss account of Grasim Industries ------------------- in Rs. Cr. -------------------

Mar '15 Mar '14 Mar '13 Mar '12 Mar '11

12 mths 12 mths 12 mths 12 mths 12 mths

Income

Sales Turnover 6,899.39 6,100.07 5,734.77 5,353.88 5,014.42

Excise Duty 566.81 496.57 479.76 384.16 374.36

Net Sales 6,332.58 5,603.50 5,255.01 4,969.72 4,640.06

Other Income 321.83 384.79 639.00 463.46 297.77

Stock Adjustments 65.04 -4.05 26.56 132.10 10.09

Total Income 6,719.45 5,984.24 5,920.57 5,565.28 4,947.92

Expenditure

Raw Materials 3,827.18 3,177.76 2,853.01 2,566.00 2,072.56

Power & Fuel Cost 1,040.62 814.58 714.33 675.68 498.85

Employee Cost 482.25 378.80 373.67 331.14 295.63

Other Manufacturing Expenses 199.21 74.09 84.30 56.22 45.30

Selling and Admin Expenses 0.00 0.00 0.00 0.00 0.00

Miscellaneous Expenses 183.39 292.89 168.08 214.43 218.78

Preoperative Exp Capitalised 0.00 0.00 0.00 0.00 0.00

Total Expenses 5,732.65 4,738.12 4,193.39 3,843.47 3,131.12

Mar '15 Mar '14 Mar '13 Mar '12 Mar '11

12 mths 12 mths 12 mths 12 mths 12 mths

Operating Profit 664.97 861.33 1,088.18 1,258.35 1,519.03

PBDIT 986.80 1,246.12 1,727.18 1,721.81 1,816.80

Interest 39.33 41.52 39.09 35.82 45.81

PBDT 947.47 1,204.60 1,688.09 1,685.99 1,770.99

Depreciation 262.55 219.61 159.21 144.20 176.29

Other Written Off 0.00 0.00 0.00 0.00 0.00

Profit Before Tax 684.92 984.99 1,528.88 1,541.79 1,594.70

Extra-ordinary items 0.00 0.00 0.00 0.00 0.00

PBT (Post Extra-ord Items) 684.92 984.99 1,528.88 1,541.79 1,594.70

Tax 155.02 89.00 302.89 364.79 412.99

Reported Net Profit 529.90 895.99 1,225.99 1,177.00 1,181.71

Total Value Addition 1,905.47 1,560.36 1,340.38 1,277.47 1,058.56

Preference Dividend 0.00 0.00 0.00 0.00 0.00

Equity Dividend 168.74 192.84 206.52 206.36 183.40

Corporate Dividend Tax 0.00 7.48 9.81 12.02 13.66

Per share data (annualised)

Shares in issue (lakhs) 918.52 918.27 917.77 917.10 916.99

Earning Per Share (Rs) 57.69 97.57 133.58 128.34 128.87

Equity Dividend (%) 180.00 210.00 225.00 225.00 200.00

Book Value (Rs) 1,217.49 1,179.13 1,102.88 992.19 887.00

Cash Flow Statement

Cash Flow of Grasim Industries ------------------- in Rs. Cr. -------------------

Mar '15 Mar '14 Mar '13 Mar '12 Mar '11

12 mths 12 mths 12 mths 12 mths 12 mths

Net Profit Before Tax 684.92 984.99 1528.88 1541.79 1594.70Net Cash From Operating Activities 449.64 62.28 848.57 791.21 1006.94Net Cash (used in)/fromInvesting Activities 25.47 221.49 -1156.98 -467.96 -433.27

Net Cash (used in)/from Financing Activities -448.22 -273.74 313.66 -326.88 -574.94Net (decrease)/increase In Cash and Cash Equivalents 26.89 10.03 5.25 -3.63 -1.27

Opening Cash & Cash Equivalents 26.30 16.27 11.02 14.65 15.92

Closing Cash & Cash Equivalents 53.19 26.30 16.27 11.02 14.65

Ratios

Key Financial Ratios of Grasim Industries

Mar '15 Mar '14 Mar '13 Mar '12 Mar '11

Investment Valuation RatiosFace Value 10.00 10.00 10.00 10.00 10.00

Dividend Per Share 18.00 21.00 22.50 22.50 20.00

Operating Profit Per Share (Rs) 72.40 93.80 118.57 137.21 165.65

Net Operating Profit Per Share (Rs) 689.43 610.22 572.59 541.90 506.01

Free Reserves Per Share (Rs) -- -- -- -- --

Bonus in Equity Capital 32.14 32.15 32.17 32.19 32.20

Profitability RatiosOperating Profit Margin (%) 10.50 15.37 20.70 25.32 32.73

Profit Before Interest And Tax Margin (%) 6.02 10.71 16.32 20.50 27.19

Gross Profit Margin (%) 6.35 11.45 17.67 22.41 28.93

Cash Profit Margin (%) 12.25 18.62 20.75 24.31 27.50

Adjusted Cash Margin (%) 12.25 18.62 20.75 24.31 27.50

Net Profit Margin (%) 8.36 15.98 23.32 23.68 25.46

Adjusted Net Profit Margin (%) 7.93 14.96 21.54 21.66 23.93

Return On Capital Employed (%) 6.19 8.58 12.07 16.21 18.89

Return On Net Worth (%) 4.73 8.27 12.11 12.93 14.52

Adjusted Return on Net Worth (%) 4.97 8.27 10.09 12.93 14.52

Return on Assets Excluding Revaluations 1,217.49 1,179.13 1,102.88 992.19 887.00

Return on Assets Including Revaluations 1,217.49 1,179.13 1,102.88 992.19 887.00

Return on Long Term Funds (%) 6.23 8.67 12.28 16.32 19.02

Liquidity And Solvency RatiosCurrent Ratio 1.45 1.36 1.14 1.53 1.04

Quick Ratio 0.86 0.89 0.88 1.19 0.81

Debt Equity Ratio 0.08 0.10 0.12 0.07 0.07

Long Term Debt Equity Ratio 0.08 0.09 0.10 0.06 0.06

Debt Coverage RatiosInterest Cover 19.08 24.72 34.88 44.04 35.81

Total Debt to Owners Fund 0.08 0.10 0.12 0.07 0.07

Financial Charges Coverage Ratio 25.76 30.01 38.95 48.07 39.66

Financial Charges Coverage Ratio Post Tax 21.15 27.87 36.44 37.88 30.64

Management Efficiency RatiosInventory Turnover Ratio 4.81 5.03 7.27 8.49 11.89

Debtors Turnover Ratio 9.73 9.91 10.25 10.30 11.59

Investments Turnover Ratio 4.81 5.03 7.27 8.49 11.89

Fixed Assets Turnover Ratio 0.87 1.03 1.40 1.60 1.56

Total Assets Turnover Ratio 0.52 0.47 0.47 0.51 0.53

Asset Turnover Ratio 0.53 0.48 0.50 0.54 0.55

Average Raw Material Holding -- -- -- -- --

Average Finished Goods Held -- -- -- -- --

Number of Days In Working Capital 98.19 92.86 61.76 80.04 28.87

Profit & Loss Account RatiosMaterial Cost Composition 60.43 56.71 54.29 51.63 44.66Imported Composition of Raw Materials Consumed 65.41 53.42 46.70 41.75 46.40

Selling Distribution Cost Composition -- -- -- -- --

Expenses as Composition of Total Sales 25.40 26.90 24.44 22.94 18.22

Cash Flow Indicator RatiosDividend Payout Ratio Net Profit 31.84 21.52 16.84 17.53 15.51

Dividend Payout Ratio Cash Profit 21.29 17.28 14.90 15.61 13.50

Earning Retention Ratio 69.66 78.48 79.79 82.47 84.49

Cash Earning Retention Ratio 79.39 82.72 82.51 84.39 86.50

AdjustedCash Flow Times 1.14 1.01 0.99 0.48 0.40

Mar '15 Mar '14 Mar '13 Mar '12 Mar '11

Earnings Per Share 57.69 97.57 133.58 128.34 128.87

Book Value 1,217.49 1,179.13 1,102.88 992.19 887.00