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T T Ltd announced its 2013-14 results on May 21st, 2014. The Company riding the weak rupee, new capacities and good overseas demand showed an increase over last year of 48% in sales and 37% in profits. The turnover for the year ending 2013-14 is Rs. 743.53.44 crores and the PAT is Rs. 8.98 crores. The EPS is Rs. 4.18 for the full year and a 10% dividend has been announced i.e. Rs 1 per share.

The Company MD, Mr Sanjay K Jain said that the Company was able to show such a strong performance despite the slow down in domestic economy, high interest rates and the steady appreciation of the currency since September.

The primary reason for the same has been 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 in Rajula, 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% interest subsidy coming due to Central Govt TUF scheme and the Gujarat Govt textile Policy. Last but not the least due to wind power generation in Tamil Nadu, and power purchase from IEX in Gujarat the power costs have also been reasonably low.

This year overall consumer demand has been slow in the country. However despite this the value added garments segment of the business has done well, showing a 10% plus increase due to the strong product and brand leveraging of the Company. However the main growth driver for the year has been the yarn segment.

In 2014-15, the Company expects the domestic demand to be the growth driver. The relatively stronger INR would keep exports at a moderate level (the impact on demand wont be as much as it seems, as our main competitor for yarn exports is Pakistan whose currency has also appreciated by about 7%). 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 interest burden would keep coming down due to debt repayment and further the Company proposes to dispose some non productive assets to bring down its debt level further.

Domestic demand has been improving since March 2014 and considering the overall optimism in the market, the Company expects strong growth in the value added garments segment. The Company is increasing its product range and re-designing its marketing communications to reach out strongly to the growing youth segment of the market, especially in rural and semi-urban areas.


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