Riding on the weak rupee, new capacities and good overseas demand, T T Ltd. registered an increase of 48 per cent in sales and 37 per cent in profits for 2013-14 as compared to the figures for the previous year. The turnover for the year was Rs. 743.53.44 crores and PAT Rs. 8.98 crores. The EPS is Rs. 4.18 for the full year. The company Board has announced a dividend of 10 per cent for year.
The Managing Director, Mr. Sanjay K. Jain, said that T T Ltd. was able to show such a strong performance despite the slowdown in the domestic economy, high interest rates and steady appreciation of the currency since September. The good performance is due to the aggressive marketing in China of cotton yarn and creating a strong brand equity for itself in the largest market of the world. Further good news is that the new spinning project at Rajula in Gujarat has started full commercial production and has started contributing in terms of both profit and turnover. The interest cost in this project is nominal due to the 11 per cent interest subsidy coming under TUFS and the Gujarat textile policy. Last but not the least, with wind power generation in Tamil Nadu and power purchase from IEX in Gujarat, power costs have also been reasonably low.
This year overall consumer demand has been slow in the country. However, the value-added garment segment of the business has done well, showing a 10 per cent increase due to the strong product and brand leveraging by the company. However, the main growth driver for the year has been the yarn segment.
In 2014-15, domestic demand is expected to be the growth driver. The relatively stronger INR would keep exports at a moderate level (the impact on demand won’t be as much as it seems as the main competitor for yarn exports is Pakistan whose currency has also appreciated by about seven per cent). Cotton prices are expected to stay moderate due to the high global stock level.
The company has no new expansion plans on the anvil for this year, hence the interest burden would keep coming down due to debt repayment. It also proposes to dispose of some non-productive assets to bring down its debt level further.
Domestic demand has been improving since March, and considering the overall optimism in the market, T T Ltd. expects strong growth in the value-added garments segment. It is expanding its product range and redesigning its marketing strategy to reach out to the growing youth segment of the market.