Indian Retail & Gems and Jewellery Industry CYG 01Jan11 17p

8/6/2019 Indian Retail & Gems and Jewellery Industry CYG 01Jan11 17p

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1

January 2011

QUARTERLY PERFORMANCEANALYSIS OF COMPANIES

(October December 2010)

INDIAN RETAIL & GEMS AND JEWELLERY

INDUSTRY

Cygnus Business Consulting & Research Pvt. Ltd.Plot No: 8-3-948/949, 1st Floor, Solitaire Plaza,

Behind Image Hospital, Ameerpet, Hyderabad - 500 073.

Tel: +91-40-23430202-05, Fax: +91-40-23430201, E-mail: [email protected]

Website:www.cygnusindia.com

Disclaimer: All information contained in this report has been obtained from sources believed to be accurate by CygnusBusiness Consulting & Research Pvt. Ltd. (Cygnus). While reasonable care has been taken in its preparation, Cygnus makesno representation or warranty, express or implied, as to the accuracy, timeliness or completeness of any such information. Theinformation contained herein may be changed without notice. All information should be considered solely as statements of

opinion and Cygnus will not be liable for any loss incurred by users from any use of the publication or contents


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QPAC-Indian Retail & Gems and Jewellery Industry- October - December 2010

Cygnus Business Consulting & Research Pvt. Ltd., 2011 2

EXECUTIVE SUMMARY.........................................................................................................3

INDUSTRY ANALYSIS ............................................................................................................4

INTER-FIRM COMPARISON..................................................................................................7

COMPANY ANALYSIS ..........................................................................................................11

1. Bata India Ltd ...................................................................................................................11

2. Classic Diamond (India) Ltd..............................................................................................11

3. Shrenuj & Co. Ltd. ............................................................................................................12

4. Suashish Diamond Ltd. .....................................................................................................12

5. Provogue (India) Ltd. ........................................................................................................13

6. Store One Retail India .......................................................................................................13

7. Shopper Stop Ltd. .............................................................................................................14

8. Gitanjali Gems Ltd. ...........................................................................................................14

9. Trent Ltd...........................................................................................................................15

10. Asian Star Co. Ltd. ..........................................................................................................15

11. Pantaloon Retail (India) Ltd.............................................................................................16

12. Rajesh Exports Ltd. .........................................................................................................16

SOURCES & METHODS FOR COMPANY PROJECTIONS...............................................17

CONTENTS


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EXECUTIVE SUMMARY

The Indian retail market is the fifth largest retail destination globally, and the most attractive emergingmarket for investment. The market is growing at 30% annually, with the organized segment registering

above average growth of 30% and continues to be one of the most attractive countries for global retailers.

Indias retail sector is wearing new clothes and with a three-year compounded annual growth rate of46.64%, retail is the fastest growing sector in the Indian economy. Traditional markets are making way fornew formats such as departmental stores, hypermarkets, supermarkets and specialty stores. Western-stylemalls have begun appearing in metros and second-rung cities alike, introducing the Indian consumer to anunparalleled shopping experience.

The Government of India is planning to allow multi-brand retail to the Foreign Direct Investment (FDI)showing its resolve to open up the sector to international chains. Indias regulatory patchwork frequentlyimpedes the efficient flow of products and needs to be coordinated across States and local jurisdictions.

The increase in tax slabs will help to increase the disposable income at the hands of people, which should

increase consumption demand and consequent footfalls. However, increase of excise duty from 8-10%would result in an increase in input costs of various products. Clarity on FDI norms is expected to comeabout in some time, giving more funding options to retailers.

A public sector tentative outlay for the 11th Plan is Rs5547.66 billion at constant price. This consists ofRs3433.87 billion for the central sector and Rs2113.79 billion for the state sector India has a largeuntapped resources (15,000MW is untapped in hydro sector; 4500MW in wind sector; 3.1 trillion units ofenergy in the solar energy sector.) This gives a huge opportunity for growth in the power sector. Concernabout global warming and introduction of limits on emission of CO2 will have a profound effect on theuse of coal for power generation. In consequence, nuclear power has its best chance of a revival forgeneration and renewable energy is gaining ground. Nuclear energy, which currently accounts for lessthan 3% of the domestic capacity, constitutes an important component of Indias energy mix in thefuture. After the NSG waiver and Indo-US nuclear deal, it is estimated that with international co-operation, nuclear power in India could increase fifteen fold to over 60,000MW by 2030 from the present4120MW. CAIRO: India will implement a pilot project on renewable energy in Egypt to enhance bilateralcooperation and encourage the Indian private sector to participate in developing wind and solar energysectors in the country.


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EBITDA and OPM

5000

5600

6200

OND 09 (A) OND 10 (E)

Rsm

5.00

5.50

6.00

6.50

7.00

%EBDITA (LHS)

OPM (RHS)

Net Profit and NPM

2100

2300

2500

OND 09 (A) OND 10 (E)

Rsm

2.00

2.50

3.00

%

PAT (LHS)

NPM (RHS)

Sales Performance

91000

93000

95000

OND 09 (A) OND 10 (E)

Rsm

1.0

1.3

1.5

%

Net Sales (LHS)

% change (RHS)

`

Source: BSE India; Cygnus Research

INDUSTRY ANALYSIS

INTRODUCTIONThe Indian retail industry is the fifth largest in the world.

Though initially, it was mostly unorganized, however,with change of tastes and preferences of the consumers, ithas become more popular with organized sectors also.

With growing market demand, the industry is expected togrow at a pace of 20-22% annually.

The retail sector would grow around 1% with revenue ofRs94584m for the quarter OND10 against OND09. Thesector would likely jump in terms of growth in theoperating profit of 13% estimated to be aroundRs5781.15m and net profit Rs3193.49m in OND10compared with OND09 quarter.

Note: Following companies are considered forcalculation: Future Group, Trent, Provogue and BataIndia

Segmental PerformanceFood and grocery retail: The organized retailsegment is gaining momentum with huge demandfor food and grocery items in the country. India has

witnessed an unprecedented growth in retail sectorin the recent past. An economic growth of 8%coupled with favorable demography has led to aconsumption boom in the country.

Industry Aggregate (Rs in million)

Particulars OND 10 (E)

Net Sales 94584.28Change 1%

EBITDA 5991.71

Change 17%

Depreciation 682.27

Interest 998.21

Other Income 324.39

PBT 3802.00

Tax

Effective tax rate 30%

Reported PAT 2648.21

Change 24%Industry Market Cap(in bn) 194.09Source: BSE India; Cygnus Research


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It has grown by 20-25% CAGR in the last 5 years. Mass grocery retail (MGR) sales in India are expectedto undergo enormous growth over the forecast period. BMI predicts that sales through MGR outlets willincrease by 145 per cent to reach US$ 21.35 billion by 2014.

Key DevelopmentsGovt. has permitted FDI to the extent of 100% in cash for wholesale format & 51% for trade of singlebrand products. The Indian retail industry is currently estimated to be USD350bn and organised retailingforms only 5%, which is projected to increase to 14-18% by 2015.

Cost Structure There would be no variation in staff cost.However, other expenditure for most of theplayers in this sector, brought some changes instrategies will have some increment. The rawmaterial cost is estimated to increase by 104basis points in OND10, compared with

OND09. Tax as a percentage of sales isestimated to witness very minimal and toincrease by 75 basis point. Interest is estimatedto decreased by 58 basis point in OND10, ascompared to corresponding quarter of the previous year.

The high growth projected in domestic retail demand will be fuelled by:

1. The migration of population to higher income segments with increasing per capita Incomes2. An increase in urbanization3. Changing consumer attitudes especially the increasing use of credit cards4. The growth of the population in the 20 to 49 years age band

There is retail opportunity in most product categories and for all types of formats

1. Food and Grocery: The largest category; largely unorganised today2. Home Improvement and Consumer Durables: Over 20% p.a. CAGR estimated in the next 10 years3. Apparel and Eating Out: 13 per cent p.a. CAGR projected over 10 years%Opportunities for

investment in supply chain infrastructure: Cold chain and logistics India also has significant potentialto emerge as a sourcing base for a wide variety of goods for international retail companies

4. Many international retailers including Wal-Mart, GAP, JC Penney etc. are already procuring fromIndia

Challenges presently involved in Retail Sector

The industry is facing a severe shortage of talented professionals, especially at the middle- managementlevel. Most Indian retail players are under serious pressure to make their supply chains more efficient inorder to deliver the levels of quality and service that consumers are demanding. Long intermediationchains would increase the costs by 15 per cent.

Lack of adequate infrastructure with respect to roads, electricity, cold chains and ports has further led tothe impediment of a pan-India network of suppliers. Due to these constraints, retail chains have to resortto multiple vendors for their requirements, thereby, raising costs and prices.

The available talent pool does not back retail sector as the sector has only recently emerged from itsnascent phase. Further, retailing is yet to become a preferred career option for most of Indias educatedclass that has chosen sectors like IT, BPO and financial services.

Cost as a % of Sales

OND 10 (E) OND 09 (A)

Stock in trade 2.28 -2.07Raw materials 68.83 66.64Processing Charge -0.10 0.21Staff cost 1.62 1.93Other expenditure 6.41 7.50

Depreciation 0.72 0.86Interest Charges 1.06 1.95

Tax 1.22 0.7Source: BSE India; Cygnus Research


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Even though the Government is attempting to implement a uniform value-added tax across states, thesystem is currently plagued with differential tax rates for various states leading to increased costs andcomplexities in establishing an effective distribution network.

Stringent labor laws govern the number of hours worked and minimum wages to be paid leading tolimited flexibility of operations and employment of part-time employees. Further, multiple clearances arerequired by the same company for opening new outlets adding to the costs incurred and time taken toexpand presence in the country.

The retail sector does not have industry status yet making it difficult for retailers to raise finance frombanks to fund their expansion plans.

FDI Policy in the Retail SectorIndia has kept the retail sector largely closed to outsiders to safeguard the livelihood of nearly 15 millionsmall storeowners and only allows 51 per cent foreign investment in singlebrand retail with priorGovernment permission. FDI is also allowed in the wholesale business. Single-brand retailers such as

Louis Vuitton, Fendi, LLadro, Nike and Toyota can operate now on their own. Metro is already operatingthrough the cash-and-carry wholesale mode.

The policy makers continue to explore areas where FDI can be invited without hurting the interest oflocal retail community. Government is considering opening up of the retail trading for select sectors suchas electronic goods, stationery, sports goods, and building equipment.

Foreign direct investment (FDI) in retail space, specialized goods retailing like sports goods, electronicsand stationery is also being contemplated. The Government has to walk a tightrope to ensure a `levelplaying field' for everyone.

The policy of permitting 51 per cent FDI in single-brand product retailing has led to the entry of only a

few global brands such as Nike (footwear), Louis Vuitton (shoes, travel accessories, watches, ties, textilesready-to wear), Lladro (porcelain goods), Fendi (luxury products), Damro (knock-down furniture),

Argenterie Greggio (silverware, cutlery, traditional home accessories and gift items) and Toyota (retailtrading of cars), into retail trading. A 12-billion euro French luxury industry is also eyeing the domesticluxury segment to make a presence through retailing directly.


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INTER-FIRM COMPARISON

Operational Performance

Provogue is leading in sales growth;Provogue sales growth in sales wasestimated to increase by 39% from OND10comparing to OND 09, followed byShopper Stop and Asian Star with 38%growth in the same period. Rajesh Exportsand Suashish were registered lowest growthof 2% and 5% respectively. Store one wasestimated in negative growth of nearly 70%followed by Pantaloon by 38% in the retailsector.

Financial Performance

Net Sales OND 09 Vs OND 10 (Rs in million)

OND 09 OND 10 Growth %

Bata 2886.45 3269.10 13%Store One 40.92 12.10 -70%Pantaloon 19128.40 11897.88 -38%

Provogue 1231.09 1710.94 39%Shopper Stop 3826.01 5226.98 37%

Trent 1546.70 2051.52 33%Asian Star 3152.08 4360.18 38%Classic Diamond 1669.48 2111.49 26%Gitanjali Gem 8760.08 10895.55 24%Rajesh Exports 45321.72 46261.99 2%Shrenuj 2734.17 3394.34 24%Suashish 3221.43 3392.22 5%


Financial Performance OND 09 Vs OND 10

Bata Store One Pantaloon

09(A) 10(E) 09(A) 10(E) 09(A) 10(E)

Net Sales 2886.45 3269.10 40.92 12.1 19128.40 11897.88

OPM 0.16 0.16 -1.72 -1.00 0.11 0.09

NPM 0.09 0.09 -2.81 -1.87 0.03 0.04


Financial Performance - OND 09 Vs OND 10

Provogue Shoppers Stop Trent

09(A) 10(E) 09(A) 10(E) 09(A) 10(E)

Net Sales 1231.09 1710.94 3826.01 5226.98 1546.70 2051.52

OPM 0.11 0.12 0.12 0.14 0.15 0.20

NPM 0.07 0.05 0.05 0.09 0.10 0.15



Rajesh Exports Shrenuj Suashish

09(A) 10(E) 09(A) 10(E) 09(A) 10(E)

Net Sales 45321.72 46261.99 2734.17 3394.34 3221.43 3392.22OPM 0.01 0.00 0.10 0.09 0.01 0.00

NPM 0.01 0.00 0.02 0.02 0.05 0.03



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Trent is expected to have the highest Net Profit MarginTrent is expected to register the highest margin in net profit as compared to its peers. Some of the Retailcompanies are expected to have low profit margin as compared to sales. However, Bata Provogue willcontribute a positive profit margin during the period JFM10. From ordinary retail part, Asian star andGitanjali both have strong brand name and both have strong domestic presence Asian star and Gitanjaliare expected to do well in terms of operation and net profit margins. Other companies like Srenuj,Suashish and Rajesh Exports are expected to register low profit margins as compared to its peers.

Cost Structure


Asian Star Classic Diamond Gitangali

09(A) 10(E) 09(A) 10(E) 09(A) 10(E)

Net Sales 3152.08 4360.18 1669.48 2111.49 8760.08 10895.55

OPM 0.04 0.31 0.07 0.07 0.07 0.10

NPM 0.02 0.14 0.02 0.02 0.04 0.07


Cost Structure (as Percentage of Net sales) - OND 09 Vs OND 10

Company Provogue Shopper Stop Trent Ltd. Industry

Year 09 10 09 10 09 10 09 10Stock in trade -4.14 1.77 -0.54 0.00 -6.54 5.32 -4.14 1.77Raw materials 46.41 40.00 0.00 0.00 0.34 0.33 46.41 40.00Processing Charge 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Traded goods 18.60 28.65 60.04 65.00 50.72 35.48 18.60 28.65Staff cost 3.88 3.00 5.34 6.00 6.50 6.32 3.88 3.00Other expenditure 23.93 15.00 22.99 15.00 33.85 32.94 23.93 15.00

Depreciation 2.41 2.00 3.18 2.00 1.81 1.76 2.41 2.00Interest 3.98 2.87 1.16 0.90 1.26 2.01 3.98 2.87

Tax 2.44 2.01 2.79 1.83 3.86 2.70 2.44 2.01Source: BSE India; Cygnus Research


Company Bata India Store One Pantaloon Retail Industry

Year 09 10 09 10 09 10 09 10

Stock in trade 5.68 5.68 132.06 96.94 -4.10 7.27 -4.14 1.77Raw materials 18.49 18.49 0.00 0.00 0.35 1.00 46.41 40.00Processing Charge 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Traded goods 19.03 19.03 0.00 0.00 73.42 65.00 18.60 28.65

Staff cost 14.30 14.30 23.95 17.59 4.32 3.00 3.88 3.00Other expenditure 26.81 26.81 115.88 85.12 15.37 15.00 23.93 15.00Depreciation 3.34 3.34 41.13 41.07 2.36 2.00 2.41 2.00Interest 0.32 0.32 103.20 103.14 4.37 2.02 3.98 2.87



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Expansions Robust growth expected from organised Retail

Carrefour, the second-largest retail chain in the world after Walmart, plans to open its first wholesalecash-and-carry store in the country at Seelampur in Delhi in the next two to three months. With thestore sprawling over 55,000-square feet of area, the store will source 90% of its products within thecountry.

Aditya Birla Retail will invest up to US$44.3m in 2010-11 to expand its 'More' brand. The group willopen 100 new supermarkets of 'More' and 8-10 new hypermarkets under the 'More Megastore' brand

Wal-Mart Stores Inc, the world's biggest retailer, will accelerate its roll-out of wholesale stores inIndia. The firm now expects to open 10-12 wholesale centres in India over two-to-three years, froman earlier target of five years, as real estate prices have become more attractive

K Raheja Group promoted Shopper's Stop has lined-up a capital expenditure of nearly US$27.6m toopen about 12 stores in 2010-11. The new stores will come up in Bangalore, Delhi, Pune, Bhopal,

Aurangabad, Vijaywada and Durgapur.

British retail giant Tesco, expects to open its first cash-and-carry store in India by the end of 2010.Middle East retail chain Max is expanding its footprints across India. Max has 16 outlets operating inthe metros while the rest are located in the tier II towns. It plans to take its total store count to 53 byMarch 2011, targeting a turnover of US$96.8m.


Company Gitanjali Gems Rajesh Exports Shrenuj Industry

Year 09 10 09 10 09 10 09 10

Stock in trade 4.94 4.79 -4.27 0.00 5.59 5.63 -4.14 1.77

Raw materials 86.78 84.20 102.67 99.01 66.44 66.97 46.41 40.00Processing Charge 0.00 0.00 0.00 -0.84 0.00 0.00 0.00 0.00

Traded goods 0.00 0.00 0.00 99.60 11.75 11.84 18.60 28.65Staff cost 0.44 0.43 0.07 0.00 1.84 1.85 3.88 3.00Other expenditure 0.60 0.58 0.05 0.00 4.57 4.60 23.93 15.00Depreciation 0.11 0.11 0.01 0.17 0.37 0.37 2.41 2.00Interest 3.12 2.37 0.51 0.01 7.13 6.03 3.98 2.87



Company Asian star Classic Diamond Suashish Industry

Year 09 10 09 10 09 10 09 10Stock in trade 1.51 2.94 -0.98 -0.98 3.75 3.78 -4.14 1.77Raw materials 87.40 85.00 42.73 42.73 53.42 53.93 46.41 40.00Processing Charge 4.07 5.00 0.00 0.00 2.14 2.16 0.00 0.00

Traded goods 0.00 0.00 47.49 47.49 0.00 0.00 18.60 28.65Staff cost 0.75 0.75 2.54 2.54 0.39 0.40 3.88 3.00Other expenditure 1.82 1.67 1.61 1.61 39.45 39.83 23.93 15.00Depreciation 0.49 0.55 0.80 0.89 0.22 0.22 2.41 2.00Interest 1.80 1.06 3.96 3.96 0.00 0.00 3.98 2.87

Tax 0.39 1.06 -0.06 0.29 2.15 3.34 2.44 2.01Source: BSE India; Cygnus Research


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Diamond retail chain ORRA Diamonds plans capital expenditure of US$16.9m for opening 16 newstores over the next three years.

The Adi Godrej-led Godrej Consumer Products Limited (GCPL) plans to focus on the Africanmarket and has drawn-up a strategy of 'One Africa' for the same.

Bharti, Wal-Mart to open 15 stores - Wal-Mart, the world's largest retailer, continues to penetrate theIndian market and hopes to launch about 15 stores across India within three years. Mukesh Ambaniled Reliance Retail Lifestyle is planning to increase the number of Reliance Jewels outlets to 100 by2013.


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COMPANY ANALYSIS

1. Bata India Ltd

2. Classic Diamond (India) Ltd.

(Rs in million)

Quarter Full Year Ended

ItemOND 09

(A)OND 10

(E)JFM 11

(P)

GrowthRate %Y o Y

March09 (A)

March10 (E)

GrowthRate %

Net Sales 2886.45 3269.10 2962.46 13% 9874.35 10919.18 11%

EBITDA 453.12 512.77 303.78 13% 866.36 1241.02 43%

Depreciation 96.41 109.21 72.40 13% 190.01 279.23 47%

Interest 9.19 10.40 3.30 13% 65.08 40.72 -37%

Other Income 39.06 44.24 9.78 13% 107.13 81.56 -24%

PBT 386.58 437.41 237.85 13% 718.4 1002.63 40%

TAX 132.56 144.72 78.69 9% 111.03 330.36 198%

PAT 254.02 292.68 159.15 15% 607.37 672.27 11%OPM 16% 16% 10% 8.77% 11.37%

NPM 9% 9% 5% 6.15% 6.16%

Tax Rate 34% 33% 33% 15% 33%

Source: Cygnus Research

Note: A: Actuals; E: Estimated; P: Projected

(Rs in million)


Item OND 09(A)

OND 10(E)

JFM 11(P)

Growth

Rate %Y o Y

March09 (A)

March10 (E)

GrowthRate %

Net Sales 1669.48 2111.49 2533.79 26% 7104.35 6719.11 -5%

EBITDA 110.42 148.86 217.75 35% 653.23 400.67 -39%

Depreciation 13.28 18.80 25.34 42% 66.51 57.44 -14%

Interest 66.10 83.60 101.35 26% 269.13 296.97 10%

Other Income 0.00 0.00 0.00 0% 9.76 0 -100%

PBT 31.04 46.46 91.06 50% 327.35 46.26 -86%

TAX -1.00 6.15 21.86 15% 15.96 10.54 -34%

PAT 32.04 40.31 69.21 26% 311.39 35.72 -89%

OPM 7% 7% 9% 9% 6%

NPM 2% 2% 3% 4% 1%Tax Rate -3% 13% 24% 5% 23%




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3. Shrenuj & Co. Ltd.

4. Suashish Diamond Ltd.

(Rs in million)


Item OND 09(A)

OND 10 (E) JFM 11(P)

Growth

Rate %Y o Y

March09 (A)

March10 (E)

GrowthRate %

Net Sales 2734.17 3394.34 4073.21 24% 9873.67 9113.66 -8%

EBITDA 268.32 308.93 427.69 15% 1000.63 858.86 -14%

Depreciation 10.22 12.68 15.89 24% 36.92 38.74 5%

Interest 194.91 204.65 288.26 5% 490.32 610.81 25%

Other Income 4.06 5.04 0.00 24% 4.52 6.3 39%

PBT 67.25 96.64 123.54 44% 477.91 215.61 -55%

TAX 22.00 25.28 25.28 15% 171.65 83 -52%

PAT 45.25 71.36 98.26 58% 306.26 132.61 -57%

OPM 10% 9% 11% 10% 9%

NPM 2% 2% 2% 3% 1%Tax Rate 33% 26% 20% 36% 38%

Source: Cygnus ResearchNote: A: Actuals; E: Estimated; P: Projected

(Rs in million)


ItemOND 09

(A)OND 10

(E)JFM 11

(P)

GrowthRate %Y o Y

March09 (A)

March10 (E)

GrowthRate %

Net Sales 3221.43 3392.22 4070.66 5% 12232.45 7621.82 -38%

EBITDA 27.37 -3.37 1192.34 -112% 727.33 -195.04 -127%

Depreciation 6.95 7.31 15.88 5% 42.64 32.18 -25%

Interest 0.00 0.00 411.76 0% 0 0 0

Other Income 220.19 231.86 0.00 5% 526.73 -421.74 -180%

PBT 240.61 221.18 764.70 -8% 1211.42 -648.96 -154%

TAX 69.12 113.23 229.41 64% 390.88 -50.7 -113%

PAT 171.49 107.95 535.29 -37% 820.54 -598.26 -173%

OPM 1% 0% 29% 6% -3%

NPM 5% 3% 13% 6% -8%

Tax Rate 29% 51% 30% 32% 8%



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5. Provogue (India) Ltd.

6. Store One Retail India

(Rs in million)


Item OND 09(A)

OND 10(E)

JFM 11(P)

Growth

Rate %Y o Y

March09 (A)

March10 (E)

GrowthRate %

Net Sales 1231.09 1710.94 2053.12 39% 3597.27 4806.67 34%

EBITDA 139.41 198.01 249.19 42% 385.25 516.32 34%

Depreciation 29.63 34.22 41.06 15% 95.11 122.84 29%

Interest 49.03 49.14 62.44 0% 149.71 199.45 33%

Other Income 57.77 0.00 0.00 -100% 262.60 207.43 -21%

PBT 118.52 114.65 145.69 -3% 403.03 401.46 0%

TAX 30.00 34.40 43.71 15% 108.84 117.93 8%

PAT 88.52 80.26 101.98 -9% 294.19 283.53 -4%

OPM 11% 12% 12% 11% 11%

NPM 7% 5% 5% 8% 6%Tax Rate 25% 30% 30% 27% 29%



(Rs in million)


ItemOND 09

(A)OND 10

(E)JFM 11

(P)

GrowthRate %Y o Y

March09 (A)

March10 (E)

GrowthRate %

Net Sales 40.92 12.10 14.52 -70% 1964.77 1045.48 -47%EBITDA -70.34 -12.07 0.51 -83% -1085.29 -470.46 -57%

Depreciation 16.83 4.97 2.90 -70% 75.00 335.47 347%

Interest 42.23 12.48 13.73 -70% 138.71 142.13 2%

Other Income 3.78 2.40 0.00 -37% 17.63 55.62 215%

PBT -125.62 -27.12 -16.12 -78% -1281.37 -892.44 -30%

TAX 0.00 0.00 0.00 0% 7.95 10.46 32%

PAT -125.62 -27.12 -16.12 -78% -1289.32 -902.9 -30%

OPM -172% -100% 4% -55% -45%

NPM -281% -187% -111% -66% -86%

Tax Rate 0% 0% 0% -1% -1%



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7. Shopper Stop Ltd.

8. Gitanjali Gems Ltd.

(Rs in million)


ItemOND 09

(A)OND 10

(E)JFM 11

(P)

GrowthRate %Y o Y

March09 (A)

March10 (E)

GrowthRate %

Net Sales 3826.01 5226.98 6272.38 37% 12651.20 14080.59 11%

EBITDA 465.11 731.78 878.13 57% 185.56 1153.86 522%

Depreciation 121.82 104.54 125.45 -14% 631.31 310.25 -51%

Interest 44.35 47.04 56.45 6% 197.82 186.9 -6%

Other Income 0.00 0.00 0.00 0% 0 0 #DIV/0!

PBT 298.94 580.19 696.23 -94% -643.57 656.71 -202%

TAX 106.80 95.65 114.78 10% -6.39 154.4 -2516%

PAT 192.14 484.54 581.45 -15% -637.18 502.31 -179%

OPM 12% 14% 14% 1% 8%

NPM 5% 9% 9% -5% 4%

Tax Rate 36% 16% 16% 1% 24%



(Rs in million)


ItemOND 09

(A)

OND 10

(E)

JFM 11

(P)

GrowthRate %

Y o Y

March

09 (A)

March

10 (E)

Growth

Rate %Net Sales 8760.08 10895.55 12529.88 24% 26543.29 26938.47 1%

EBITDA 634.15 1089.56 1679.00 72% 1693.96 1801.78 6%

Depreciation 9.82 11.62 22.43 18% 34.26 43.36 27%

Interest 273.52 258.55 300.72 -5% 177.92 453.39 155%

Other Income 1.40 0.05 0.05 0% 4.95 2.17 -56%

PBT 352.21 819.44 1355.91 133% 1486.73 1307.2 -12%

TAX 37.85 65.21 94.91 72% 105.2 39.51 -62%

PAT 314.36 754.23 1261.00 140% 1381.53 1267.69 -8%

OPM 7% 10% 13% 6% 7%

NPM 4% 7% 10% 5% 5%

Tax Rate 11% 8% 7% 7% 3%Source: Cygnus Research



15/17



9. Trent Ltd.

10. Asian Star Co. Ltd.

(Rs in million)


Item OND 09(A)

OND 10(E)

JFM 11(P)

Growth

Rate %Y o Y

March09 (A)

March10 (E)

GrowthRate %

Net Sales 1546.70 2051.52 1777.79 33% 5141.59 5140 0%

EBITDA 234.17 401.94 93.59 72% 152.21 62.24 -59%

Depreciation 27.99 36.14 36.14 29% 88.54 92.33 4%

Interest 19.49 41.15 2.83 111% 13.15 13.13 0%

Other Income 31.60 40.80 41.83 29% 322.71 325.98 1%

PBT 218.29 365.44 96.46 67% 373.23 282.76 -24%

TAX 59.66 55.31 8.14 -7% 44.60 15.21 -66%

PAT 158.63 310.13 88.32 96% 328.63 267.55 -19%

OPM 15% 20% 5% 2.96% 1.21%

NPM 10% 15% 5% 6.39% 5.21%Tax Rate 27% 15% 8% 12% 5%



(Rs in million)


ItemOND 09

(A)OND 10

(E)JFM 11

(P)

GrowthRate %Y o Y

March09 (A)

March10 (E)

GrowthRate %

Net Sales 3152.08 4360.18 4578.19 38% 12542.98 13485.10 8%EBITDA 140.18 1335.87 1382.97 853% 651.19 669.11 3%

Depreciation 15.54 23.98 30.22 54% 66.14 76.35 15%

Interest 56.61 341.09 351.72 503% 263.14 236.44 -10%

Other Income 7.78 0.00 0.00 -100% 3.28 13.71 318%

PBT 75.81 970.80 1001.04 118% 325.19 370.03 14%

TAX 12.27 339.78 350.36 23% 135.97 88.80 -35%

PAT 63.54 631.02 650.68 3% 189.22 281.23 49%

OPM 4% 31% 30% 5% 5%

NPM 2% 14% 14% 2% 2%

Tax Rate 16% 35% 35% 42% 24%



16/17



11. Pantaloon Retail (India) Ltd

12. Rajesh Exports Ltd.

(Rs in million)


Item OND 09(A)

OND 10(E)

JFM 11(P)

Growth

Rate %Y o Y

March09 (A)

March10 (E)

GrowthRate %

Net Sales 19128.40 11897.88 14277.46 -38% 63417.00 59343.70 -6%

EBITDA 2034.40 1038.19 1544.39 -49% 3153.30 5791.30 84%

Depreciation 451.70 237.96 285.55 -47% 1400.50 1618.80 16%

Interest 835.30 240.07 377.65 -71% 3182.20 2882.40 -9%

Other Income 20.20 0.00 0.00 -100% 60.60 846.30 1297%

PBT 767.60 560.16 881.19 -27% -1368.80 2136.40 -256%

TAX 260.90 168.05 264.36 -36% 756.50 340.80 -55%

PAT 506.70 392.11 616.83 -23% -2125.30 1795.60 -184%

OPM 11% 9% 11% 5% 10%

NPM 3% 3% 4% -3% 3%Tax Rate 34% 30% 30% -55% 16%



(Rs in million)


ItemOND 09

(A)OND 10

(E)JFM 11

(P)

GrowthRate %Y o Y

March09 (A)

March10 (E)

GrowthRate %

Net Sales 45321.72 46261.99 48575.09 2% 86670.15 123417.73 42%EBITDA 673.90 460.26 2669.87 -32% 3816.78 2152.42 -44%

Depreciation 5.23 4.79 4.37 -8% 16.28 17.56 8%

Interest 229.86 308.59 932.92 34% 1479.99 1415.74 -4%

Other Income 0.19 0.18 0.00 -6% 0.75 266.55 35440%

PBT 439.00 147.05 1732.57 -67% 2321.26 985.67 -58%

TAX 0.00 0.00 519.77 0% 255.64 111.91 -56%

PAT 439.00 147.05 1212.80 -67% 2065.62 873.76 -58%

OPM 1% 1% 5% 4% 2%

NPM 1% 0.3% 2.5% 2% 1%

Tax Rate 0% 0.0% 30.0% 11% 11%



17/17


Cygnus Business Consulting & Research Pvt Ltd 2011 17

SOURCES & METHODS FOR COMPANY PROJECTIONS

Sources

Company annual reports Press releases BSE India Research reports related to Economy, Industry and Company

Methods

Understanding companies product services Understanding industry and economic indicators and general economic scenario Understanding the dynamics between the companies and the industry in relation to demand and

supply, technology, regulation, inflation, etc

Understanding recent strategies and initiatives taken by companies such as product launches,capacity additions and M&As

Making revenue projections based on the expected business strategies and financial analysis Validating the financial projections of the company with the overall business strategy Calculating the cost structure on the basis of sales and past and present trends in the industry Analysing quarterly growth rates and growth rates of last 8 quarters

The cut-off date for OND quarter results is January 18, 2011. Quarterly performance analysis

of companies announcing their results after this date is based on Cygnus estimates.

Documents

Indian Retail & Gems and Jewellery Industry CYG 01Jan11 17p