Investor Presentation - Chittorgarh · 2018-07-28 · USTER Certificate We are one of the few...

Investor Presentation

JULY 2018“Creating Possibilities, Creating Value.”

This investor presentation does not constitute a prospectus or an offer to acquire securities. This document is for information purposes

only and not intended to be taken alone for the basis for an investment decision. The information contained in this presentation is only

current as of its date. Our presentation/ proposal may include predictions, estimates, management opinions or other information that

might be considered forward-looking. These forward-looking statements represent our current judgment on the future; they are

subject to risks and uncertainties that could cause actual results to differ materially. Such forward-looking statements are subject to

risks and uncertainties like regulatory changes, local political or economic developments, and many other factors that could cause

actual results to differ materially from those contemplated by the relevant forward-looking statements. The Company can change any

of the information provided in this presentation without obligation to notify any person. No person is authorized to give any

information or to make any representation not contained in this presentation and, if given, such information or representation must

not relied upon. This presentation is strictly confidential.

The Company or its Lead Managers will not be in any way responsible for any action taken based on such statements and undertakes

no obligation to publicly update these forward-looking statements to reflect subsequent events or circumstances.

Disclaimer

“Creating Possibilities, Creating Value.”

Company Highlights1. Lagnam Spintex was originally incorporated on June 11, 2010 as a Private Limited and started commercial

operation from April 2012

2. Lagnam Spintex has strong track record of performance with growing Turnover, Export, PBT, PAT, RoNW every

year.

3. Lagnam Spintex is an ISO 9001:2015 certified Company engaged in the business of manufacturing of high quality

open end cotton yarn for domestic and export market ranging from count Ne 4 to Ne 20 which is used in Denim,Terry Towels, Bottom Wears, Home Textiles and Industrial Fabrics etc.

4. With the proposed expansion, the manufacturing capacity will more than double from 16.5 MT per day to 35.1MT per day and will significantly diversify the end use for our product offering.

5. Lagnam Spintex has been recognized as “One Star Export House” by the Director General of Foreign Trade. Alsoreceived OEKO-Tex certification

6. Lagnam Spintex has been recognized as Investment Grade company by ICRA (BBB-)

7. Highly experienced board, with 4 out of 6 directors being Chartered Accountants, having vast industry

experience


Milestone of Our Company

201720162015

201420132012

2010

Incorporation of the Company Started ExportsCompleted Second

Expansion Awarded Star Export House Certificate

Awarded ISO 9001:2015 certificate in Manufacture & Export of Cotton Yarn

Started Commercial Production

Completed First Expansion

Oeko-tex Certificate

GOTS Certificate

Received

Uster Certificate


Robust growth in Performance

REVENUE (IN CRORES)

PAT (IN CRORES)

EBIDTA (IN CRORES)

RETURN ON NET WORTH


Promoters

ANAND MANGAL (35 Years)Managing Director

•He has completed his B.Sc.(Honors) in Business & Management Studies from University of Bradford, UK•He has experience of 7 years in the field of business administration & Sales & Marketing•He is a proven influencer & negotiator and has pragmatic approach of getting the required results.•Anand leads the customer relationship & international business vertical which has led to rapid growth in

exports.

D.P. MANGAL (69 Years)Chairman and Whole-Time Director•He is a Chartered Accountant with more than 38 years experience in the Textile Industry•He retired as Executive Director of RSWM Ltd after working for 17 years and was over viewing overall

operations & profitability of their various units and undertaken many expansion projects•He served on the Board of Bhilwara Technical Textile Ltd, Cheslind Textile Ltd and RSWM-Sisa SA, Spain•He also worked as CEO of JCT Ltd, one of the largest integrated textile mills of India producing more

than 60 Lakhs meters fabrics a month and Executive Director of Aditya Mills Ltd for a period of 6 years•He plays the key role in formulation and implementation of business strategy for growth and expansion


Board of Directors

J.C. LADDHA (69 Years)Independent Director

•He is a qualified Chartered Accountant and had been associated with RSWM Ltd. for around 43 years, whichis engaged in business of textile and is one of the largest textile companies in India with a turnover of aroundINR 3,000 crores as on 31st March 2017•During his tenure with RSWM Ltd. From 1973 to 2016, he has worked at various management positions and

was involved in various expansion projects of the company•Currently, he is the Chairman of M/s Sudiva Spinners Pvt. Ltd. which is engaged in manufacturing of cotton

yarn having 28,560 spindles and 2,208 rotors with a Turnover of INR 286.57cr. as on 31st March 2018•He is also Vice Chairman of Rajasthan Textile Mill Association and continue to serve onboard of RSWM Ltd.

VIJAY BAPNA (69 Years)Non-executive Director•He has completed his M. Com and is a Chartered Accountant, having a rich experience of 46 years

•He was responsible for overall management and operations and was on the board of Ispat Industries Ltd,Indorama Petrochem Ltd. Bangkok, Welspun Maxsteel Ltd., Welspun Steel Ltd., Remi Metal Gujarat Ltd.,

Welspun Resource Australia, Essar Steel Algoma, Canada and Essar Steel Minnesota USA.

•He has received many awards and recognition like Udyog Ratna Award, Best Professional Manager Award,International Management Excellence Award

•Advisor of MOORE STEPHENS Singhi International, UK a top 10 branded global accounting and advisory

network.•On Social front, he is International President of Mahavir International, a social organization.


Board of Directors

DIPALI MATHUR (36 Years)Independent Director

•Dipali is an MBA with very strong understanding of Indian consumer and strong foundation in Finance andWealth Management• She has worked with Citibank, HSBC Bank and Standard Chartered Bank in Retail and Wealth Management for

10 years.• She is founder of Magnifique, a chain of luxury salons and Bonjuz a chain of freshly squeezed Healthy

beverages & made to order healthy food options• She is an entrepreneur with multiple business ventures

ANIL SHAH (64 Years)Independent Director

•He is a CA in practice for the last 40 years, presently he is a senior partner of M/s. Anil Shah & Associates•He was associated with ICAI as Member, Secretary & Chairman of Chapter of Udaipur Branch•He is involved as Advisors to various Industrial Groups, presented papers and penal speaker in various

seminars, conferences conducted by various Professional Institutions•Acting as Treasurer of Bharatiya Lok Kala Mandal for the last 25 Years and also the Treasurer of Vidhya Bhawan

Society for 5 years• Founder Secretary of “Advent Age Education Foundation” where running G.D. Goenka International School


Technology

At Lagnam, Yarn is manufactured using the most Automated, State of the Art and

Innovative Technology.

Blow Room

Modern Blow Room Line from Truetzschler with Fully automatic Bale Opener, Seed

Trap, Pre-Cleaner, Multi Mixture, Cleanomat Cleaner CL - C3 / 1600 equipped with

Dustex and SPFPU to control Colour and White Polypropylene contamination.

Card and Drawing

Truetzschler latest card TC 5-3 with quality monitoring and Draw Frame TD - 07 with

micro computer control system and Auto can changer.

Truetzschler Draw Frames TD-08 with Autoleveller, up to 8 fold doubling, computer

control system with comprehensive quality monitoring and auto can changer.

Open-End Spinning machines from SCHLAFHORST, Germany, the leading textile

machine manufacturer in the world.


TechnologyUSTER CertificateWe are one of the few textiles companies in the world which has been authorized to use USTERIZED™ Trademark. Thequality can be matched to Customers' requirements with the most Advanced Technology and has Uster Equipmentslike AFIS PRO 2, UT5, UTR 4 & Classimat 5


Balance Sheet

In INR Lakhs FY 2018 FY 2017 FY 2016 FY 2015 FY 2014

Net Fixed Assets 5,210.10 4,846.48 5,075.85 3,461.29 2,529.38

Capital work in Progress 79.99 23.55 0.00 216.30 230.89

Other non-current assets 78.82 88.73 89.90 177.02 99.61

Inventories 1,330.42 748.51 528.53 560.71 417.10

Trade receivables 874.55 899.34 922.91 674.03 587.48

Cash and bank balances 8.99 2.42 8.42 28.38 133.71

Other current assets 788.24 578.49 427.48 281.12 142.81

Total Assets 8,371.11 7,187.52 7,053.10 5,398.85 4,140.96

Share Capital 1,166.90 226.80 226.80 226.80 206.80

Reserves & Surplus 1,477.50 1,847.91 1,480.83 1,272.32 1,034.50

Long term borrowings 2,741.15 3,256.68 3,676.14 2,885.35 1,949.99

Other Non-current liabilities 486.37 375.65 181.19 68.38 35.93

Short term borrowings 1,741.97 969.32 1,096.65 668.59 682.53

Trade payables 233.64 77.31 62.21 33.71 53.19

Other Current Liabilities 523.58 433.85 329.29 243.70 178.02

Total Liabilities 8,371.11 7,187.52 7,053.10 5,398.85 4,140.96


Profit & Loss

In INR Lakhs FY 2018 FY 2017 FY 2016 FY 2015 FY 2014

Revenue from operations 8,390.61 7,503.30 5,617.34 4,946.36 4,187.90

Total Revenue 8,454.47 7,538.43 5,656.41 4,983.41 4,205.99

Cost of Material Consumed 6,161.59 5,190.53 3,736.74 3,443.15 3,080.65

Purchase of Stock in Trade 0.00 0.00 74.68 0.00 0.00

Changes in Inventories of FG & WIP -214.59 19.62 -34.63 71.93 -115.96

Employee benefit expense 151.53 117.06 121.70 94.39 75.87

Other expenses 1,237.33 1,056.91 852.63 720.52 572.20

Total Expenses 7,335.86 6,384.12 4,751.12 4,329.99 3,612.76

EBIDTA 1,118.61 1,154.31 905.29 653.42 593.22

Finance cost 284.52 342.69 395.28 330.47 279.92

Depreciation and Amortization 261.25 260.39 191.96 136.42 136.70

PBT 572.84 551.24 318.05 186.54 176.60

Tax 104.35 184.15 109.55 28.72 31.89

PAT 468.49 367.09 208.50 157.82 144.71


Financial Ratios

Particulars FY 2018 FY 2017 FY 2016 FY 2015 FY 2014

EBITDA Margin 13.23% 15.31% 16.00% 13.11% 14.10%

PAT Margin 5.54% 4.87% 3.69% 3.17% 3.44%

ROCE 14.60% 15.66% 12.82% 11.61% 14.15%

RONW 17.72% 17.69% 12.21% 10.53% 11.66%

Debt-Equity Ratio 1.70 2.04 2.79 2.37 2.12

EPS 4.15 3.27 1.86 1.41 1.43

Earnings per ShareReturn on Capital Employed


Exports

• SOUTH AFRICA

•CHINA

•BANGLADESH

•PAKISTAN

• PORTUGAL• ITALY

•GERMANY

•COLUMBIA

• BELGIUM• SLOVENIA

EXPORTS (IN CRORES)

•BHILWARA


Investment Rationale• Robust Financial performance: The company revenue is growing at CGAR of 19.07% and PAT is increasing by 34.04% on year on year

basis since 2013

Snap shot of key Numbers

• Experienced Promoters: Promoters of our Company have combined experience of 45 years in textile industry. Chairman of our company

retired from RSWM Ltd as a Executive Director after serving for more than 15 years

• Optimum capacity utilization: Our company existing plants operates at 99% capacity. With the additions in capacity, revenues ofcompany shall increase many folds since there is a robust demand for our products

• Increase in manufacturing capacity: With the commissioning of new manufacturing facility, the production capacity of our company will

increase to 35.1 MT yarn per day from present 16.5 MT yarn per day

Particulars FY 2018 FY 2017 FY 2016 FY 2015 FY 2014

Sales 8,390.61 7,503.30 5,617.34 4,946.36 4,187.90

EBITDA 1,118.61 1,154.31 905.29 653.42 593.22

PAT 468.49 367.09 208.50 157.82 144.71


Investment Rationale

• Low Finance Cost: The Company has low interest financial cost. The debt of INR 94 Cr carries net interest payment outgo of 3.50% to

4.15% after taking into account subsidy from Government

• Investment Grade Rating: ICRA have awarded BBB- rating to the company and SBI has granted SB 5 rating to the company

• Long standing relationship with the customers: Longstanding relationship with the customers has helped in obtaining repeat business

that gives stability to and a competitive advantage in acquiring new clients and increasing the business

• Technological advantage: Our expansion plant will be a fully automatic plant equipped with latest technology with machines imported

from internationally renowned manufacturers such as Truetzschler, Uster, Saurer, Rieter and Electro Jet

• Strong culture for research and development: In house research and development team, having access to advanced technology andequipment, tests yarns of different strengths according to client specifications and requirements. The company is authorized to use

USTERIZED Trademark, as token of highest quality

• Wide Product range and customized offering: With the commissioning of new manufacturing facility, company will offer all kinds of yarnsin the industry to its clients

• Order of major Plant & Machinery has been placed and civil construction work is being carried out for the new facility


S.W.O.T Analysis

• Promoter and management team

have rich industry experience

• Company has a wide and strong

customer base

• Plant is equipped with quality

equipment and technology

•Locational advantage of the

production site

• Exposed to currency fluctuation

risk for exports and import of

machinery

• Fluctuation in raw material cost

Strengths Weaknesses

ThreatOpportunities

•Severe Competition in domestic

and international markets

•Pricing Pressures on Finished

Goods due to competition

•Volatility in input cost

• Abundant Raw Material Supply

• India’s proximity to emerging

markets is a key advantage for

developing an export base

• Expansion plan of Company


Certifications

OEKO-TEX Certificate TRADEMARKS REG. GOTS CERTIFICATE

ISO 9001:2015USTERIZED TRADEMARKSIA CERTIFICATE


Our Customers


Objects of the Issue

• Setting up additional manufacturing facility of 25,536 spindles for production ofRing spun combed and carded yarn

• Meeting Issue Expenses

Amount in croresCost of Project 125.40

Means:Bank borrowings 94.00(Consortium of SBI & PNB)

Internal Accruals 9.40

Net proceeds from IPO 22.00Total 125.40


Details Particulars

Issue Size Upto 60,00,000 Equity Shares

Issue Size in amount Rs. 24.60 Crores

Face Value Rs. 10/-

Issue Price Rs. 41/-

Lot Size 3,000 Shares

Issue Opens on [●]

Issue Closes on [●]

IPO Venue NSE Emerge

ISSUE HIGHLIGHTS

Lead Managers to the Issue

Holani Consultants Private Limited

BOI Merchant Bankers Limited

Registrar to the Issue

Bigshare Services Private Limited

Issue Structure

Market Maker Portion 3,00,000 Equity Shares

Retail Portion 28,50,000 Equity Shares

Non-Retail Portion 28,50,000 Equity Shares

Shareholding Pattern PRE IPO POST IPO

Promoter & Group Holding 99.91% 65.98%

Public Holding 0.09% 34.02%


Contact Us

Registered Office Address : A 51- 53, RIICO Growth Centre

Hamirgarh, Bhilwara- 311001, Rajasthan, IndiaPhone:+91 1482-289210, +91 9929091010

Contact : Mr. Anand Mangal

Email: [email protected]

401-405, 416-418, 4th Floor, Soni Paris Point,

Jai Singh Highway, Bani Park, Jaipur-302016 (Raj.)

Landline : 0141-2203995 / 2201259

Mobile : 98290 10099

Contact : CA Ashok Holani

Website: www.holaniconsultants.co.in

E-mail: [email protected]

Star House-II, First Floor, Plot No. C-4, G-Block,

Bandra-Kurla Complex, Bandra (E), Mumbai –

Landline : 022-6131 2906

Mobile : 9478954140

Contact : Mr. Promod Kumar Bathal

Website: www.boimb.com

E-Mail : [email protected]


mailto:[email protected]

http://www.holaniconsultants.co.in/

mailto:[email protected]

http://www.boimb.com/

http://www.boimb.com/

Investor Presentation - Chittorgarh · 2018-07-28 · USTER Certificate We are one of the few...

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