The Result Is One of India's Most Profitable Fashion
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PASSION MEETS FASHION THE RESULT IS ONE OF INDIA’S MOST PROFITABLE FASHION HOSIERY COMPANIES ANNUAL REPORT 2016-17 ONE OF INDIA’S MOST PROFITABLE FASHION HOSIERY COMPANIES* THE YEAR 2016-17 WAS ONE OF THE MOST CHALLENGING. DEMONETISATION. SLUGGISH CONSUMER SENTIMENT. INCREASED COMPETITION. THE WORST OF TIMES FOR MOST. THE BEST OF TIMES AT LUX. REVENUES INCREASED 3.37%; PROFIT AFTER TAX STRENGTHENED 22.42%. There is something to be said about a company that reports profitable growth when the pessimists are describing it as a year not worth remembering. * Includes innerwear and outerwear products LUX. MORE THAN A COMPANY; MORE THAN PRODUCTS; A BRAND THAT STANDS FOR A A QUALITY ASSURANCE OF THE PIONEERING COMMITMENT IN THE BEST MANUFACTURING AND FASHION HOSIERY SECTOR. QUALITY STANDARDS. About us Our Vision Our core values Brands Manufacturing Location No. of units Founded in 1957 by Girdhari facilities To keep creating new To ensure complete Lal Todi as Biswanath The prominent Lux brands Tirupur, Coimbatore, 1 benchmarks for quality satisfaction and utmost Hosiery Mills, Lux Industries comprise Lux Venus, Lux Lux has six Tamil Nadu and comfort, the two comfort for every consumer Ltd. came into being in 1995. Classic, Lux Karishma, Lux manufacturing units B.T. Road, Kolkata, 2 fundamentals that lay by creating top notch The Company is headed Touch, GenX, Lux Cozi, Lux across five locations West Bengal the foundation of our products. in India. and managed by the second Cozi Big Shot, Lux Cott’s Dankuni, Kolkata, 1 company and take it to To constantly bring about generation of the founder Wool, Lux Inferno, Lux West Bengal the epitome of success. family. The Company is Mozze, ONN and Lux Cozi change in our methods Dhulagarh, Kolkata, 1 head-quartered in Kolkata Glo. These brands have of production through West Bengal sustained innovation and with five manufacturing demonstrated consistent locations across India. traction on account of Ludhiana, 1 stringent quality control Punjab practices. their high quality, recall, endorsement and superior Creating new business price-value proposition. along with customer Our Mission satisfaction is the driving Product portfolio To be recognised as force behind our economic the best Indian hosiery engine. Lux Industries Lux offers a range of more company globally and to Limited will strive to adhere than 100 products under 12 Listing Quality Policy drive the industry towards to the highest of ethical brands for a growing family’s The shares of Lux Industries Limited ISO 9001:2008: sustainable growth and standards and transparency (men, women and children) were listed on the National Stock Lux was accredited development. in all its business dealings needs. This makes the Exchange on 1 December, 2015 and with Quality and transaction. Company’s products relevant across ages, genders, on the Bombay Stock Exchange on 5 Management geographies and seasons. January, 2016. The Company’s market System in capitalisation was H1800 crore as on accordance with March 31, 2017. ISO 9001 standard LUX ANNUAL CORPORATE MANAGEMENT FINANCIAL 2 INDUSTRIES LTD. 2016-17REPORT 00 OVERVIEW 00 REPORTS 00 STATEMENTS 3 Global presence Awards and achievements Recognised among Asia’s most respected brands and leaders 2012-13 2013 2014 Asia’s Most Promising Brands The Master Brand The Master Brand Lux exports products to the following countries: Algeria | Iran | Iraq | Kuwait | Bahrain | UAE | Saudi Arabia | Yemen | Djibouti | Ethiopia | Kenya | Ghana | Togo | Benin | Nigeria | Cameroon | Colombo | Malaysia | Singapore | Hong Kong | Canada | Congo | 2014-15 2015 2016 Sudan | Angola | Thailand | Melbourne | Nepal | Poland | Panama | Morocco | Guinea | Bissau | Chad | Gabon | Uganda | Zimbabwe | The ADMIRED Brand of India The World’s Greatest Brands Asia’s Greatest Brands Cote d’Ivoire | Zambia | Niger | Mali | Senegal | Gambia | Mauritania | South Africa | Burkina Faso | Australia | North America Our highlights 19 Beginning 19 Ye Andar Ki 19 New initiative 19 Widening 20 Big league 20 Lux Cozi Zee Cine 20 Commencement of 20 Face of Lux Baat Hai footprint Awards 2014 Dankuni Plant Cozi 57 Mr. Girdharilalji Todi 92 94 Lux became the first 98 03 The Lux IPO was 14 16 17 set out to make The first television hosiery company to Lux widened its launched and massively Lux Cozi became The commencement Varun Dhawan was everyday innerwear advertisement Ye organise a conference pan-India footprint; oversubscribed. title sponsor at the of one of Eastern signed as Lux Cozi comfort a reality Andar Ki Baat Hai for dealers to discuss established its Delhi Zee Cine Awards, India’s largest brand ambassador; for Indians through featuring Sunny Deol business plans. office. the world’s biggest hosiery product Lux Glo, a sub New look Biswanath Hosiery was launched. 20 viewer’s choice manufacturing plant brand of Lux Cozi Mills. 10 Indian film icon Shah awards, seen by over at Dankuni, West was launched; Lux 20 Face of Lux Rukh Khan was 700 million viewers Bengal. conducted the largest- 00 Sunny Deol was engaged as brand across 168 countries. ever dealership Lux became a primary 19 Younger 19 Going global 19 Restructuring signed as Lux Cozi’s ambassador for ONN. conference in the sponsor of the Kolkata 64 management 93 Lux began to export 95 Biswanath Hosiery brand ambassador. hosiery industry where Knight Riders. The second generation products to Middle was incorporated 20 Nation-wide all dealers attended of entrepreneurs East, Africa and into Lux Industries 20 Alliances 15 Listing the conference for the assumed management. Europe. Limited, making Lux 20 Step into the 13 Lux became Comfort The shares of Lux first time. the flagship company 01 future Partner for Kings XI were listed on National of the Group. Lux was incorporated Punjab and Pune Stock Exchange (NSE) as a public limited Warriors India in the and Bombay Stock company. IPL. Exchange (BSE). LUX ANNUAL CORPORATE MANAGEMENT FINANCIAL 4 INDUSTRIES LTD. 2016-17REPORT 00 OVERVIEW 00 REPORTS 00 STATEMENTS 5 01 03 05 07 The innerwear market Pessimists have been Most companies Most textile companies has become increasingly complaining that were challenged by were challenged by the need competitive in the last manufacturing costs declining brand spending to efficiently manage their few years. are rising effectiveness working capital outlay Lux strengthened its EBIDTA Lux’s margins rose every Lux’s profit from every rupee Lux reduced working capital margin by 610 bps - from single year during the last invested in brand spending outlay from 70% of total 6.29% in FY13 to 12.39% five years; PAT margin more increased from 5.74% in capital employed to 63% in in FY17 than doubled to 6.46% FY13 to 7.76% in FY17 the four years ending FY17 02 04 06 08 Margins were largely Increased capital expenditure Most companies in the There was a greater need under pressure in a hesitant in a capex-heavy sector textile sector were affected to enhance the productivity in 2016-17. is threatening Balance by raw material volatility of shareholder funds (net Sheet comfort worth) within the business Lux revenues grew H32 cr; Lux moderated its raw EBIDTA grew by H26 cr A capex-driven Lux material as a percentage of Lux maintained RoE at 30% moderated its gearing from turnover from 64% in FY13 to or higher for four years of the 3.01 to less than 1.0 in the 43% in FY17 last five ending FY17 last five years We make products that make people At Lux, we premiumise the quality of MIND feel good about themselves what we market, strengthening value- At Lux, the focus is not as much on the addition ‘product’ as much it is on the pride that We manufacture products at one of the MEETS it can enhance for the users and buyer lowest costs – and that has made all the difference At Lux, we have invested extensively in We innovated products for the first manufacturing integration and scale time in our sector with the objective to reduce costs At Lux, we believe that there is no We provide one of the widest choices pride bigger than owning or wearing MATTER At Lux, we provide a wide range of something that most do not have 7 over 5,000 SKUs, among the largest THERE IS JUST ONE WORD THAT We grew product concepts into large such innerwear ranges in the industry, FAITHFULLY APPLIES TO LUX. successful brands graduating us into a one-stop shop. things that Lux OUTPERFORMER. At Lux, we have consistently We provide a superior service has done better demonstrated the capability to We enjoyed a fill rate (order collected conceive, invest and mature brands GOOD MARKETS OR BAD. than most against dispatches) of more than 95%, We position products in a manner that higher than the industry average of makes consumers want to pay more 80%. LUX ANNUAL CORPORATE MANAGEMENT FINANCIAL 6 INDUSTRIES LTD. 2016-17REPORT 00 OVERVIEW 00 REPORTS 00 STATEMENTS 7 LITERAL MEETS LATERAL WAYS IN WHICH WE HAVE GONE AGAINST THE INDUSTRY GRAIN – 5 AND SUCCEEDED 01 02 03 04 05 We don’t follow We create We focus more on We invest We extended price points; we markets with a smaller number in our trade synergistically create them the objective of brands relationships with outwards to At Lux, we have to carve out a At Lux, we work the same focus contiguous demonstrated a disproportionate with few brands; we as infrastructure products differentiated ability large share invest more in them; At Lux, we believe At Lux, we in building sales, At Lux, we resist we enjoy a high that the core of focused on core popularity and the temptation success rate our strength does innerwear products, market acceptance of playing the not lie in machines proceeding around attractively usual, generic and or products; it lies cautiously towards new product price commodity game; in the goodwill related products points we would rather do we enjoy among that account for a the different and the distributors, dealers larger share of the new and retailers customer’s wallet LUX ANNUAL CORPORATE MANAGEMENT FINANCIAL 8 INDUSTRIES LTD.