Beruflich Dokumente
Kultur Dokumente
Face Value: Rs 10
Book value - Consolidated: Rs 157.65 (May 31,
2012)
Bid size: 50 equity shares and in multiples thereof
100% Book built Issue
Capital Structure:
Pre Issue Equity:
Post issue Equity:
Rs
Rs.
19.80 crs
27.60 crs *
Post issue
%*
53.47
46.53
100.0
CARE Fundamental
average fundamentals
Grade:
3/5
indicating
Tara Jewels Ltd (TJL) is an integrated player in the jewellery industry with
experience ranging from designing to retailing of jewellery. Its portfolio of
products includes gold, platinum, honeydium, pristinium and silver
jewellery with or without studded precious and semi-precious stones and
has presence across different price points and cater to customers across
high-end, mid-market and value market segments. It has four
manufacturing units, of which one is located in Panyu, China. The other
three units are located in Mumbai, India out of which two units are situated
in SEEPZ and one in MIDC. For the two months period ended May 31,
2012, Fiscal 2012, 2011 and 2010 TEL has achieved an aggregate
production of 554.77 kgs, 10,616.40 kgs, 4,753.25 kgs and 2,562.91 kgs
of jewellery, respectively. Its manufacturing units are spread over an area
of 84,584 square feet employing 35 designers and 955 craftsmen, as on
September 30, 2012.
TJL exports studded jewellery, which is manufactured by it and by third
party manufacturers. It exports studded jewellery to jewellery chains
including Christ Uhrean & Schmuck and retailers including Walmart and
primarily export to Australia, China, Canada, European Union, South
Africa, UAE, UK and USA. In the European Union, it exports to 12
countries including Austria, Germany and Switzerland. TJLs income from
export operations has grown at a CAGR of 19.77% from Fiscal 2010 to
Fiscal 2012. For the two months period ended May 31, 2012, Fiscal 2012,
2011 and 2010, its income from export operations constitutes 78.82%,
80.90%, 80.99% and 97.59% of its total income, respectively.
TJL conducts its jewellery retail operations under the brand Tara
Jewellers and has entered in jewellery retailing in India in October 2008
with the launch of its existing Store at Andheri, Mumbai and as on the date
it operates 30 Existing Stores spread over an aggregate area of 29,949.01
square feet. It intends to launch 20 Project Stores across India by March
31, 2013. Its retail stores span across suburban areas of metro cities, mini
metros and cities with higher concentration of mid-income segment. Sales
of TJL from retail operations increased to Rs. 1,834.81 million in Fiscal
2012 from Rs. 142.74 million in Fiscal 2010 at CAGR of 258.53%.
Objects of Issue:
The objects of the Issue are:
Meet the expenses of establishing retail stores.
Repayment of Pre-payment Loans.
General Corporate Purpose
The companys total consolidated revenues were Rs 14,010.56 million for
the year ended March 31, 2012 as against Rs 11,435.68 million in FY11
and PAT was Rs.541.28 million in FY12 as against of Rs 406.85 million in
FY11.
Means of Finance:
The fund requirement will be met entirely from the Net proceeds of the
Issue.
Cost of Project:
S. No.
1
2
6
Particulars
Establishment of retail stores
Repayment or pre-payment of loans
General corporate purposes
Total
Amount
664.80
500.00
*
*
Rs. Million
Estimated schedule of deployment of Net
Proceeds (Up to March 31, 2013)
664.80
500.00
*
*
(Source: RHP)
Retail Research
TJLs strengths:
TJLs strategy:
operations.
Top 10 customers for Fiscal 2012 accounted for 70.40% of TJLs total revenue from export operations in Fiscal 2012. It
cannot be assured that sales from export operations will continue; if not, its income may decline.
TJL is exposed to currency exchange risks, since its income on account of overseas clients is denominated in U.S. Dollar
opportunities.
Ineffective execution of marketing programs and reduced marketing expenditure could have an adverse effect on TJLs
sales.
Failure to manage TJLs inventory could have an adverse effect on its net sales, profitability, cash flow and liquidity.
Entire sales for export operations are made utilizing credit provided by TJL to its customers. Therefore, any deterioration in
the consumers financial position could adversely impact sales and income.
TJL obtains gold on loan basis, which remains subject to RBI regulations. Any adverse change in the regulations governing
gold on loan basis may adversely affect its financial condition and results of operation.
Changes in consumer attitudes to jewellery could be unfavourable and harm jewellery sales.
TJL has significant working capital requirements and its inability to meet its working capital requirements may have an
time, which upon expiry or if withdrawn prematurely, may adversely affect its financial condition and results of operations.
TJL has entered into an MoU with M. Fabrikant & Sons which contained certain restrictive covenants.
Retail Research
Theft and other incidences in TJLs manufacturing units and retail stores will adversely impact its profitability. Its insurance
may not be adequate to protect it against all potential losses to which it may be subject to.
Increases in interest rates may adversely impact TJLs results of operations.
Retail Research