Pantaloon Fsa

Pantaloon Retail (India) Ltd. 21. Rajiv Siddhartha 22. Shweta Singh 23. Nimish Singhatwadia 24. Bikram Snehi 25. Anuj Tagra

Background On Retailing •

India today is home to the biggest consumption opportunity in the world.

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A young demographic profile, a growing middle class and technical innovation are bringing about the change

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However there are unique challenges as well-

1)The size and diversity imply that no standardized global solution will work in India. 2) The one size fits all approach will not live up to the needs and expectations of new, young India.

Pantaloon’s Contribution “Everything, everywhere, every time for every Indian customer in the most profitable manner” •

An increase in the wallet share of the customer from 30 percent a couple of years back to more than 75 percent today.

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Customized offerings will cater to the diversity.

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Diversification into other segments to fully capture the investment boom and boost the retail business.

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Forays into development and management of retail real estate, asset management and consumer finance

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Addressed as Future Retail, Future Space, Future Capital, Future Brands, Future Logistics and Future Media.

Management Discussion & Analysis India is one of the fastest growing large economies of the world. A study by McKinsey shows that the market for consumer goods could reach a whopping $400 billion by 2010. India represents an economic opportunity on a large scale, both as a global base and domestic market. Study also shows that organized retail sector in India is expected to grow at a higher rate than the GDP growth in the next five years. Specialized retailers are developing rapidly in segments such as consumer durables and white goods, books, music, healthcare and beauty. Pantaloon is poised to expand its retail space coverage by 2.50 million tonnes in the year to come.

Management Discussion & Analysis Human resources Accounts for over 8% of the employment pool. The company has envisioned big expansion plans over the next few years. An attempt to get qualified , skilled personnel led to the launch of ‘ Seekho- A call to learn”, the company’s educational initiative. Internal Controls and their adequacy Well

defined

organizational

structure,

documented

policy

guidelines, predefined authority levels and extensive systems of internal controls to ensure the optimum utilization of the company’s resources. Regular reviewing of financial and risk management policies , significant audit findings , the adequacy of internal control

Financial Performance •

Sales- Increased from Rs 105,070.26 lacs to Rs 185,148.85 lacs.

•

Operating Profit- Rs 14,623.77 lacs

as compared to 9391.06

lacs in the previous year. •

Interest-

Interest and financial charges outflow marginally

increased from Rs 2745.66 lacs in 2004-05 to Rs 3352.48 lacs in 2005-06. •

Net Profit- It increased from from Rs. 3855.10 lacs to Rs 6415.75 lacs.

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Dividend- The company has proposed a dividend of 25% for the current year amounting to Rs 766.38 lacs.

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Cash Flow- The company has registered the cash profit of Rs. 9984.51 lacs during the year.

Financial Performance •

Debt-Equity – This has improved from 0.89 to 0.50.

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Earning per share- The company’s basic earning per share is Rs 25.30 , which was Rs 16.54 in the preceding year registering the growth of 53%.

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Cash Earning per share- The CEPS is Rs.33.51 which was Rs 22.25 in the preceding year registering the growth of 67 percent.

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Investment- The company’s investment portfolio has increased substantially from Rs 3191.55 lacs in 2004-05 to Rs 14,061.57 lacs in 2005-06.

Balance Sheet

↑154 % ↑67 %

↑258 %

↑139 %

Schedule of Balance Sheet

↑ 242%

Schedule of Balance Sheet

Capital Employed

apital employed in the business increased by Rs.62, 082.89 lacs in 2005-06 Increase on account of significant investment in subsidiaries and joint entures and lease rental deposits given for stores.

Current assets and liabilities

Fixed Assets

Increase due to : Plant & Machinery Office & Equipments Furniture ; Electrical Equipments

Shareholder’s Funds

•Increase in Equity shares:489 crores •

Increase in share capital leading to increase in reserves and surplus specifically share premium

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Warrant Application money - 300.00

•Increase in Share Premium:17,000 crores •Authorised 3500 lakh equity shares •Issued 2688.7 lakh equity shares

DEBT – EQUITY RATIO

•Fair mix of debt and equity •Debt increasing along with the share capital •Arrangement of funds for expansion •Increase in borrowings by Rs. 31,517.81 lacs and an increase in equity by Rs. 30,656.08 lacs.

Increase in Loan Funds

Working capital loans >long term loans Increase in unsecured loans Shift focus to rupee loans Expansion plans

Financial Ratios

Cash Flow Statement ↑ 73%

↑ 56% ↑ 95.30% ↑ 340% ↓ 555%

↑ 253% ↑ 250%

Cash Flow Statement ↑ 1125 %↑ 175 % ↑ 383% ↑ 22%

Ratio Analysis Interest Coverage Ratio (Cash) : = Cash Generated From Operation Net interest (7,922) = - 2.4 times 3,35 2 Interest ratio =(Earnings): Profit Bef Tax Dep & Interest Net interest 9,189 = 2.7 times 3,35 2

Profit & Loss Account An Increase of 77%

An Increas e of 77%

An Increas e of 72%

Expenditure

Schedule Analysis Sh. 14. Sales & Services

Other pr. Income 10927.26 Lakhs

Sh.18. Manufacturing & Othr. Exp. Rent 120%

Sh. 16 COGS & Consumed

Purchases on Finished Goods has increased by 92%

Advertisin g 56%

Lease 900%

Sh. 19 Interest Expenses Inc. by 57.3% to 1736.07 Lakhs Sh. 17 Personnel Cost Salaries & Wages Increased by 124%

Schedule 14 - Effect & EPS Calculation

Effect of Other Operating Income Income from operations (Excl. Other Operating income)

Expenditure PBT

In Lakhs

175849.79 178007.55 -2157.76

Calculation of EPS & PE

PAT Shares Outstanding EPS Price PE

In Lakhs

6415.00 253.00 25.36 466.00 18.38

Profitability Ratio