Thangamayil exults in presenting its investors the 17th historical Annual Report of the company corresponding to the financial year 2016-2017 against the previous years for the notice of investors. We hereby express our profuse thanks to our investors and employees. The company carried the trade through a lean phase in the industry, reaping an EBITA profit of Rs.4,955 lakhs in the year as against an EBITA profit of Rs.4,599 lakhs in the previous year. You(Investors) can rejoice this as a part-owner of the business.
Plan for near future
The report apart from providing audited accounts, on sales for the year, puts thought into expansion strategies in order to realize the opportunities in untapped markets of northern districts. It also contemplates to open atleast ten “TMJL-plus” mini outlets, serving as silver article sales outfits and customer care centres, to keep up the goodwill in the minds of the people and improve the customer base.
Such initiatives are the need of the hour to keep pace with the innovative marketing strategies of our peers and continue the good work.
Hostile external factors
As you are well aware, the gold trade in India witnessed a volatile trend due to unstable price throughout the previous financial year for reasons beyond the control of jewellery retailers. The very beginning of the year witnessed an all India strike by the jewellery traders on a large scale protesting the imposition of Central excise duty. It took two months solidly to resume normal operations. The Central Government’s demonetization move on November 2016, also, hit the trade hard. To make things worser, the price of gold soared, all of a sudden, early in the calendar year 2017. However your company braved all the odds and prospered.
Impact of GST & regulatory changes
We need to asses the impact of GST on gold trade and the potential negativities posed by regulatory changes like:
- Introduction and reversal of abolition of gold on lease scheme
- Jewellery purchase schemes falling under the scope of Deposits
- PAN Card requirement for any sales exceeding certain value.
Renovation of stores
As indicated earlier by the Chairman and Managing Director in his letter to the shareholders, ten of our existing stores were restyled and modernized. The sales in these outlets are showing postive results after the facelift, as per our expectations. We have an agenda of renovating ten more showrooms in the current year.
The brand you can count on
Our Board of Directors have a legacy of rich experience in the same trade for decades. Under the dynamic leadership of senior management the skilled and well trained front and back office employees strive to meet the current trends and ever changing tastes of people in choosing jewellery. We solicit the valuable support of all investors for a rewarding financial year 2017-18. Thangamayil is a brand you can count on.
FINANCIAL CONDITION OVERVIEW
The financial statements have been prepared in compliance with the requirements of the Companies Act and the generally adopted Indian Accounting Principles (GAAP) and the Accounting Standards notified by the Companies (Accounting Standard) Rules, 2006.
1) Share Capital
The issued, subscribed and paid up capital as at March 31, 2017 stood at Rs. 1,371.96 lakhs. There was no fresh infusion of capital during the year.
2) Reserves and Surplus
Reserves and surplus stood at Rs. 13,778 lakhs as against Rs. 12,382 lakhs in the previous year.
3) Fixed Assets
Gross block of Fixed Assets is Rs. 11,454.77 lakhs which comprises of Plant & Machinery, Furniture & Fixtures, Vehicle and Buildings of Rs. 9,176.50 lakhs & Computer Equipment’s of Rs. 2,278.27 lakhs.
Inventories amounted to Rs. 31,200 lakhs as at 31st March 2017 as against Rs. 28,092 lakhs as at the previous year end.
5) Trade Receivables
Trade Receivables amounted to Rs. 85.02 lakhs as at 31st March 2017 as against Rs. 26.90 lakhs as at 31st March 2016.
6) Cash and Cash Equivalents
Cash and bank balances with banks amounts to Rs. 2, 022 lakhs as against Rs. 940 lakhs in the previous year. The increase is on account of margin money kept for gold metal loan facilities.
7) Short Term Loans and Advances and Other Current Assets
Short term Loans and advances amounted to Rs. 1,419 lakhs as against Rs. 941 lakhs in the previous year. Loans and Advances includes advances paid for raw material and pre-paid insurance, advance to expense, advance payment of taxes and other advances.
8) Current Liabilities & Provisions
Current liabilities excluding provisions amounting to Rs. 25,176 lakhs includes secured loan from banks, and Trade creditors for raw materials and creditors for advertising and promotion spends, packing materials, advance received from customers and creditors for capital purchases.
9) Working Capital
The Company has a Working Capital (including cash and bank balances) of Rs. 9,549 lakhs as at 31st March 2017 as against Rs. 9,351 lakhs as at 31st March 2016. The increase in working capital is on account of internal accruals and increased long term sources.
10) Debt Equity Ratio
Your Company has got Average Net Debt Equity ratio of 1.76 as at 31.3.2017 as against 1.85 as at 31.03.2016.