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Project Report on

‘’Financial Reengineering to reduce cost

of capital through Competitor Analysis’’

Undertaken at TRIDENT GROUP

Submitted by

Surbhi Jindal

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Acknowledgement

“It is not possible to prepare a project report without the assistance & encouragement of other

people. This one is certainly no exception.”

On the very outset of this report, I would like to extend my sincere & heartfelt obligation towards all

the personages who have helped me in this endeavor. Without their active guidance, help,

cooperation & encouragement, I would not have made headway in the project.

I am ineffably indebted to Mr Ankit Mahajan for conscientious guidance and encouragement to

accomplish this assignment.

I am extremely thankful and pay my gratitude to Mr Anuj Pareek for his valuable guidance and

support on completion of this project in its presently.

I extend my gratitude to Trident Group for giving me this opportunity.

I also acknowledge with a deep sense of reverence, my gratitude towards team member of Trade

finance who helped me in all the possible ways.

Any omission in this brief acknowledgement does not mean lack of gratitude.

Thanking You

Surbhi Jindal

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Table of Contents

Introduction and Overview……………………………….………………………………………………4

Competitor Analysis...............................................................................................................…....5

Related Study………………………………………………………………………………………….….6

Terminologies learnt during the project………………………………………………………….……..8

Research Methodology……………………………………………………………………………….....15

Method followed…………………………………………………………………………………….…....16

Trident Business Overview……………………………………………………………………….….....18

Textile Industry Competitor Analysis.....................................................................................…...19

Welspun India Limited……………………………………………………………….………….20

Vardhman Textile………………………………………………………………………….…….23

Nahar Spinning Mills…………………………………………………………………………….26

Alok Industry………………………………………………………………………………….….29

Pulp and Paper Industry Competitor Analysis…………………………………………….………….32

Tamil Nadu Newsprint and Paper Limited………………………………………….…………33

Ballarpur Industries Limited………………………………………………………….…………37

J.K. Paper…………………………………………………………………………….…………..40

Recommendation and Savings………….………………………………………………….………….43

Competitor’s Products and savings ………………………………………………….………..50

Additional Products…………………………………………………………………….………..51

Conclusion……………………………………………………………………………………….……….53

Bibliography……………………………………………………………………………………….……...54

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Introduction and Overview

In the contemporary world, Globalisation, Technology and many other factors have led to rapid

expansion of almost everything in the business environment. There is a huge market to cater to –

demanding a wide range of products; there are numerous type of materials - to be sourced from a

great number of available suppliers.

This brings in the question of analysing enormous amounts of data, to come up with that perfect

plan and strategy for an organisation, with of aim of bringing the profits also up to the level and scale

of other variables.

One very important aspect of succeeding in today’s dynamic and vast business environment

is, knowing what the others are doing and acting upon it

Competitor Analysis has been the first aspect of this project. Ranging from comparison of Non-

financial variables like Products range, Raw material procurement and Physical Capacities , to the

Financial Comparison of the all the important Ratios and the Capital structure, it provides the

comprehensive view of the current position of the trident limited vis-à-vis it’s key competitors.

Finance is a major component in almost all business activities. It includes the planning of financial

resources, making of an optimum capital structure and efficiently utilizing those financial resources

by deeply analysing the cost of financial resources and the capital budgeting tools.

‘’Poor firms ignore their competitors; average firms copy their competitors;

winning firms lead their competitors’’

- Philip Kotler

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Competitor Analysis

Competitor analysis is an essential component of corporate strategy. It helps to reveal strategic

weakness, future plans, planned strategies and changes in the environment and this proactive

knowledge will give the firm strategic agility.

Strategic technique is used to evaluate outside competitors. The analysis seeks to identify

weaknesses and strengths that a company's competitors may have, and then use that

information to improve efforts within the company. An effective analysis will first obtain important

information from competitors and then based on this information Trident can be benefitted.

-The two main sources of information about competitor’s strategy is what the competitor says and

what it does. What a competitor is saying about its strategy is revealed in

Annual reports

Interview with analysts

Statement by managers

Press releases

However, this stated strategy often differs from what the competitor actually is doing. What the

competitor is doing is evident in where it cash flow is directed, such as in the following tangible

actions

R&D Projects

Capital Investment

Mergers & Acquisitions

Strategic Partnerships

The analysis has been conducted in two parts:

1. Operational Comparison

Assessment of Operational Comparison of the companies has been analysed at overall level with

Trident Group for the past five years, in respect of:

Raw Material Procurement

Product Range

Physical Capacities

Solid waste management

Key Projects.

2. Financial Comparison

Assessment of financial performance of the companies has been analysed at overall level with

Trident Group for the past 5 years, in respect of:

Finance cost

Financial Ratios.

Loan Portfolio

Stock Price.

Credit Rating

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Related Study

Corporate Finance is the area of finance dealing with the sources of funding and the capital

structure of corporations. When a company wants to avail the Term Loan or Working Capital Loan,

it has to go through a banking process i.e.

Project Report Proposal Letter Loan Approved Sanction Letter

Bank avails 2 types of Loan to the company:-

1. Term Loan.

2. Working Capital Loan.

.

Consortium/ Multi banking Arrangement (MBA) Financial Arrangement for Working Capital: - Consortium

Financial Arrangement for Term Loan: - MBA/JLA

It is a type of arrangement under which the company avails finance from more than one bank and

amongst the financing banks, one bank acts as Lead Bank. Suppose an organization requirement

for financing its project is of large amount, say about 1000 crores. Then in such a case, a single

bank would not be able to grant the entire loan amount to the organization. Therefore, in such cases

4-5 banks will come together & then they provide the loan to the company, so that the risk of

financing is shared among the banks equally.

For example

A company has availed a 500 Crore loan in which State Bank of India (lead bank) share is 45%,

associate bank’s share is 20% and others bank 35%. So the security is to be divided in their share

ratio.

Term Loan is availed for more than 12

months with a floating rate of interest

(ROI is high as compared to WCL) it is

generally used to finance a new project

or to purchase Fixed Assets.

Term Loan Working Capital Loan

Working Capital Loan is availed for a

period of 12 months it helps to finance

the day to day activities of the business.

(Prepared by the Bank

with the help of Co.)

Fixed assets are charged as Primary

Security

Current assets are charged as Primary

Security

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Corporate Funding

Process

STEP- 1

Project

Report

STEP- 2

Proposal

Letter

STEP- 4

Sanction

Letter

STEP- 3

Loan

Sanctioned

It is the first

Report which is

sent to bank for

the sanction of

Loan to a

particular Project

and it consists of

details of the

project and

amount of finance

and where it will

be utilised in the

project and period

in which the

finance amount

will be repaid.

After the project

report is accepted

the proposal letter

is letter is prepared

by the bank with the

help of company to

share confidential

information.Consist

of company is

taking which type of

Loan and what is

the type of security

is being mortgaged

and most important

company’s

financial health.

Sanction letter is

prepared by the

bank’s

committee only

after fulfilling all

the detail. Then

company within

3-4 months has

to accept

sanction letter

and send

confirmation to

the bank.

After fulfilling all

the formalities

and details then

bank opens the

account of the

company and

then company

can start

withdrawing the

money

according to the

agreement.

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Terminologies Learnt during the Project

1. Fund based (FB) and Non Fund Based Limits (NFB) Fund based is a Limit in which company is getting finance in cash form E.g. Cash Credit, Term Loan. Whereas in Non-Fund based Limit, bank does not provide funds at the time of availment, instead a commitment is given by the bank on the behalf of the company. E.g. Bank Guarantee.

2. Cash Credit (CC)

Cash Credit is a short Term Loan i.e. one of the part of the Working Capital Loan provided by the

bank but only after the required security is given to secure the loan (generally current assets are

secured) and then Company receives the loan and can continuously draw from the bank up to a

certain specified amount. The bank charges interest each month for operating the CC

account. Once the CC account is opened, the person can start issuing cheques.

Used for the purpose to finance day to day activities of the company.

Interest is charged only on the amount of loan taken by the customer.

3. Export Packing Credit (EPC)

Export Packing Credit is a borrowing facility provided by an authorized bank. Packing credit is given

by the instruction of Reserve Bank of India to promote exporters to earn foreign currency to

strengthen financial status of the company. Packing Credit is a separate finance given to exporters

not connected with any Limit of other Loans given by the bank

Used only for the purpose of Export Shipments.

To help an exporter to finance the cost of buying with a Low Interest Rate to Boost exports.

4. Credit Rating Agency (CRA)

Credit rating agency is the agency that gives rating to the company on the basis of their Repayment

and interest payment capabilities and is a very important parameter to check before bank issues

Loan because on the basis of Credit rating bank gives Loan. So the company having high rating will

be preferred by the banks E.g. CRISIL, CARE etc. are the credit rating agencies.

Higher the Credit Rating, the Lower will be the interest rate.

Necessary to have Credit Rating before applying for the Loan.

Fund Based Limit: - Cash Credit/Working Capital Demand Loan/BD + Export Packing

Credit + Term Loan.

Non Fund Based Limit: - Bank Guarantee + Letter of Credit + Forward Contracts.

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5. Parri-Passu Charge

The term Parri-passu refers to loans, bonds or classes of shares that have equal rights of payment,

or equal seniority.

In Case of Term Loan

Fixed assets is given as security to all the lenders and the same is shared among them on pari

passu basis. At the time of liquidation (when company not able to repay) then banks having charge

on the fixed assets will first recover the amount due by sale of assets and share the proceeds among

them in their loan ratio. If the amount is not realised fully then the balance of Current assets is used

to recover the money.

In Case of Working Capital

Current Assets is given as security and at the time of Liquidation the bank will recover its money

from Current Assets and if not able to recover then will go balance of Fixed Assets is used.

In case of Consortium i.e. when security is given against consortium Loan and all the banks have

their ratio in security according to their contributed loan share so when at the time of Liquidation all

the banks have an option to sell :-

1st Security

2nd Security Current Assets

1st Security

Fixed Assets

2nd Security Fixed assets

Current Assets

Fixed Assets Term Loan

Current Assets Working Capital

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6. Bill Discounting (BD)

A bill discounting is a process that involves effectively selling a bill to a bank inland or Foreign as

the case maybe.

To secure Terms of Payment.

L/C cannot be amended or Cancelled without prior agreement of the beneficiary.

It only deals with Documents not Goods.

Step 1 - Buyer to apply for LC. Step 2 - Seller bank to issue LC. Step 3 - Bank to advise the LC. Step 4 - Seller to dispatch goods to buyer Step 5 - Seller to submit transportation documents to Bank. Step 6 - Bank to submit the documents to seller’s Bank. Step 7 - Seller’s Bank to inform the buyer about the documents

Step 8 - Bill discounted and funds credited when buyer gives it acceptance.

7. Export Bill Rediscounting (EBR)

Export bill rediscounting under this scheme the exporter’s bills are discounted at the post shipment

stage and simultaneously rediscounted abroad by the Bank for raising foreign currency funds.

Both Sight and Usance bills can be discounted under EBR scheme.

Eligibility: All exporter are eligible to discount their bills drawn under LC, non-credit bills under

sanctioned limits.

Currency: USD/GBP/EURO/JPY

Cross currency: If an exporter has bill drawn in any other currency can also avail EBR

Seller Buyer

Advising Bank Issuing Bank

Process of Bill

Discounting

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8. Export Bill Purchased (EBP)

The Export Bill Purchase is a kind of short-term financing where customers sell the full set of export

documents to Bank and then bank will pay money to the customer and customer will get the money

after deducting interest amount.

Functions

1. Export Bill Purchase helps increasing cash inflows of the current period, and improving customers'

financial standing and financing capability.

2. Customers are able to choose the currency of financing based on the respective interest rates,

minimizing financial cost.

3. Customers are able to sell foreign exchange earlier to mitigate the risk of foreign exchange rate

Source: - http://www.bocusa.com/portal/Info?id=420&lang=1&

9. London interbank offered rate (LIBOR)

LIBOR Rate is the benchmark set in the financial institutions of London for Lending rates. LIBOR is

used as the base rate for a large number of financial products such as futures, options and swaps.

Banks also use the LIBOR interest rates as the base rate when setting the interest rates for loans,

savings and mortgages.

It is a Form of Committee.

It is a Base Rate charged by the foreign banks if any Foreign Loan is taken.

Its rate is always less than 1%.

Exporter Importer

Advising Bank Issuing Bank

2. Bill Purchase

Agreement

4. Submit the

documents.

5. Present the

Documents

3. Advise the

documents

1. Pay at maturity

under L/C.

6. Make the payment

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10. Financial Market

Marketplace where buyers and sellers participate in the trade of assets such as equities, bonds,

currencies and derivatives. Financial markets are having transparent pricing, basic regulations on

trading, costs and fees, and market forces determining the prices of securities that trade.

Capital Market

Any Company requires capital

(funds) to finance its operations

and to engage in its own long-

term investments. To do this, a

company raises money through

the sale of securities - stocks

and bonds in the company's

name. These are bought and

sold in the capital markets.

Money Market

The money market is used by

participants as a means for

borrowing and lending in the short

term, from several days to just

under a year. Money market

securities

-Treasury bills, -Commercial paper,

-Repurchase agreements

(repos)

Derivative Market

The derivatives market is

the financial

market for derivatives, financial

instruments like futures contracts

or options, which are derived from

other forms of assets. Participants

in a derivative market can be

segregated into four sets based on

their trading motives.

Hedgers

Speculators

Margin Traders

Arbitrageurs

.

Commodity Market

A 'commodity market' is a market

that trades in primary rather than

manufactured products. Soft

commodities are agricultural

products

Wheat, coffee, cocoa and sugar.

Hard commodities are mined, such

as gold, rubber and oil

.

Foreign Exchange Market

The foreign exchange market is a

global decentralized market for the

trading of currencies. In terms of

volume of trading, it is by far the

largest market in the world.[1] The

main participants in this market are

the larger international banks.

.

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11. Online Payment Methods

Online payments refers to the money exchanged electronically. Typically, this involves use of

computer networks, the internet and digital stored value systems. Most used Methods:-

Real time Gross Settlement.

National Electronic Fund Transfer.

12. Forward Contract (to hedge currency risk)

Forward contract is an agreement to sell or buy an asset on a specified date for a specified price.

For example

Exporter agrees to sell dollar 1 million goods and importer agrees to buy after 6 months @Rs 37/$

Real Time Gross Settlement (RTGS)

Fund Transfer system.

Typically used for high value transactions.

‘’Real time" means payment transaction is not subjected to any

waiting period.

Once processed, payments are final and irrevocable.

Transfers amount more than 2, 00,000.

RTGS systems may be the only way to get same day cleared

funds and so may be used when payments need to be settled

urgently.

National Electronic Fund Transfer (NEFT)

Fund Transfer system.

Transfers all types of payments.

Usually the best method for retail remittances.

Customer initiating the transfer needs to have the IFSC

(Indian Financial System Code) of the bank branch.

Exporter Importer

Forward

Contract

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13. Income Recognition and asset classification (IRAC)

It is a guideline by an RBI.

To check the status of the company that company is paying timely its interest and repayment.

And if more than 90 days have passed i.e. 3 months the company has not paid the interest to the

bank then account for bank will be classified as NPA (Non-performing Asset) i.e. the asset owned

by the bank is not generating income for the bank.

The IRAC norms serve two primary purposes:-

To depict the true position of a bank's loan portfolio

To help arrest its deterioration.

Banks cannot consider as income interest on loan accounts, classified as Non-Performing Assets

(NPA), unless actually received. Such unrealised interest on NPA taken as income in the earlier

year has to be provided for. In other words, income from NPA is booked as income only when

actually received, and not on accrual basis.

Asset Classification by the banks:-

14. Card Rate (CR)

A rate which is set by the banks to provide particular loan and rate which is standardized for all and

every bank has their own card rates and if the company with good credit rating also gets the

concession from banks on the card rates and also if the company is regular customer or good

relations also benefit in this case.

Standard

Sub-Standard

Doubtful

Loss

(Company is not in any Doubtful

Position.)

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Research Methodology

Started with the basic Learnings

To reduce finance cost through competitor analysis, knowledge of three financial statement and

their link with each other is very important because this is the only mode available to know about

the borrowing cost of the competitor.

Balance Sheet

Profit and Loss Statement

Cash Flow

Balance sheet

Balance sheet is the statement showing the current financial position of the company at the end of

the current year. A balance sheet is often described as a "snapshot of a company's financial

condition". Of the three basic financial statements, the balance sheet is the only statement which

applies to a single point in time of a business calendar year.

A standard company’s balance sheet has three parts: assets, liabilities, and ownership equity. The

main categories of assets are usually listed first, and typically in order of liquidity. Assets are followed

by the liabilities.

The difference between the assets and the liabilities is known as equity or the net assets or the net

worth or capital of the company and according to the accounting equation, net worth must equal to

assets minus liabilities.

Cash Flow

Cash Flow helps in knowing the Cash used / Generated during the year from 3 different operations

I.e. INFLOW & OUTFLOW of Cash

Liabilities + Equity = Assets

Equity (Net Worth) = Assets - Liabilities

Cash from Operating Activities All the non-cash items are added back to the profit and it includes the cash flow

Current Assets + Current Liabilities

Cash from Investing Activities Consider Fixed Assets

Cash from Financing Activities

Consider Long Term Liabilities

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Method followed

Finance cost is effected by 3 Parameters:-

The most Important parameter that effects the finance cost is:-

Sources of Finance is from where the company can borrow money to finance the company for

short-Term as well as long term purpose. So, sources of finance in the balance sheet are:-

Issue of Share Capital i.e. (Preference share or Equity shares).

Reserves and Surplus (Transferring profit every year).

Money received against share warrant.

Long Term Borrowings (includes borrowing not only from bank but also from other sources)

Short Term Borrowings (includes borrowing not only from bank but also from other sources).

Borrowing Cost in short it is the Cost of Capital that company spends in the form of Interest to

finance and also includes Bank charges.

Interest Expense on Long Term Borrowing

Interest Expense on Short Term Borrowing

Cash Flow (During the Year) it tells the inflow and outflow of the cash during the year and i.e. where

the money is utilised and cash generated during the year

Purpose of using Cash Flow statement:-

Because Balance sheet only tells the figure at the end of year i.e. Closing Balance of the current

year but cash flow gives more detail view to understand the movement of cash from one activity to

another.

1. Sources of

Finance 2. Borrowing

Cost

Long Term Finance

Short Term Finance

2. Cash Flow

(during the year)

Loan Portfolio

(Products used by the company to finance)

Credit Rating

(On the basis of their repayments & Interest)

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In Detail Study with an Example:-

Balance sheet Linking: - How one effects the other?

Example-1 ABC Co Ltd issues equity shares of Rs 5000 (500 shares @ 10/share) during the year?

(Solution) Equity shares can be utilised in Non-Current Investment Like:-

Fixed Assets =Rs 3000

Non-Current Investment =Rs 2000

Long Term Loans & Advances =Rs 1000

Rs 5000

Example-2 XYZ Co Ltd Company Reserves & Surplus increased by Rs 10,000 during the year?

(Solution) Reserves & Surplus are increased due to the profit transferred during the year and this

profit can be utilised anywhere Like:-

Current Assets =Rs 7500

(Inventories = Rs 4000, Debtors = Rs 3500)

Non-Current Assets =Rs 2500

Rs 10,000

Example-3 SOP Co Ltd borrowed money Rs 10,000 from ICICI @ 11.50%, Rs 20,000 from Financial

Institution @ 11%, and Rs 20,000 through issue of 9.50% debentures?

(Solution) All these Long Term Borrowing is being utilised in Long Term assets or Finance new

Project Like:-

Tangible Assets =Rs 40,000

(Plant & Machinery = Rs 15,000 + Land & Building = Rs 25,000)

Intangible Assets =Rs 10,000

Rs 50,000

Example- 4 MNO Co Ltd borrowed working capital money Rs 45,000 from SBOP @ 10.91%?

(Solution) Short Term Borrowing is being utilised in Current Assets Like:-

Inventories =Rs 20,000

Other Current Assets =Rs 25,000

Rs 45,000

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24%

76%

Trident segment wise revenue contribution

Paper and Chemicals

Textiles

Trident Business Overview

Trident limited is the flagship company of the Punjab headquartered conglomerate Trident Group,

having a turnover Rs 37,536 million. Trident manufactures textile products (terry towel, cotton yarn,

blended yarn, among others), paper, chemical and energy. Trident with its planned expansion is

strategically poised to become one of the biggest and most renowned home textiles manufacturers

globally. It has already achieved the milestone of being the largest manufacturer of terry towel in the

world after commissioning of its new plant in Budhni, Madhya Pradesh in 2013-14. Trident has a

customer base spread across the world and derives 48% of its revenues from exports.

The analysis has been conducted in two parts:

Textile Industry

This part involves the comparison of Trident with 4 of its Key competitors in Textile industry

Vardhman Textile Limited.

Welspun India Limited.

Alok Industry.

Nahar Spinning Mills Limited.

Paper Industry

This part involves the comparison of Trident with 3 of its Key competitors in paper industry

Tamil Nadu Newsprint and Paper Limited (TNPL)

Ballarpur Industries Limited (BILT)

J.K. Paper

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Textile Industry Competitor Analysis

The textile industry or apparel industry is primarily concerned with the design and production

of yarn, cloth, clothing, and their distribution. The raw material may be natural, or synthetic using

products of the industry. India’s textiles sector is one of the mainstays of the national economy. It is

also one of the largest contributing sectors of India’s exports contributing 11 per cent to the country’s

total exports basket. The textiles industry is labour intensive and is one of the largest employers.

The industry realised export earnings worth US$ 41.57 billion in 2013-14.

The textile industry has two broad segments, namely handloom, handicrafts, sericulture, power looms in the unorganised sector and spinning, apparel, garmenting, made ups in the organised sector.

Potential of Textile Industry in 21st Century India The Indian textiles industry, currently estimated at around US $108 billion, is expected to reach US

$ 141 billion by 2021. The industry is the second largest employer after agriculture, providing direct

employment to over 45 million and 60 million people indirectly. The Indian Textile Industry

contributes approximately 5 per cent to GDP, and 14 per cent to overall Index of Industrial

Production (IIP).

The future for the Indian textile industry looks promising, buoyed by both strong domestic

consumption as well as export demand. With consumerism and disposable income on the rise, the

retail sector has experienced a rapid growth in the past decade with the entry of several international

players like Marks & Spencer, Guess and Next into the Indian market. The organised apparel

segment is expected to grow at a compound annual growth rate (CAGR) of more than 13 per cent

over a 10-year period

Textile Competitor’s Performance in Stock Market as on 2015.

Source: - www.moneycontrol.com

The stock market is one of the most important ways for companies to raise money, along with debt

markets which are generally more imposing but do not trade publicly. This allows businesses to be

publicly traded, and raise additional financial capital for expansion by selling shares of ownership of

the company in a public market.

This part involves the comparison of Trident with 4 of its Key competitors in Textile industry

Vardhman Textile Limited.

Welspun India Limited.

Alok Industry.

Nahar Spinning Mills Limited.

Below the comparisons are given with all the key competitors of Trident in Textile Industry.

Stock Price (Rs) Market Cap (Billion)

Trident 24.60 11.98

Vardhman 702.80 44.87

Welspun 709.90 71.07

Nahar 122.50 4.40

Alok 7.15 9.92

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Welspun India Limited

Welspun Group is a multinational company whose core industries are steel, energy, and textiles.

Welspun is one of India's fastest growing conglomerates, doing business in over 50 countries with

24,000 employees and over 100,000 shareholders. Its product range covers the entire gamut of bed

and bath textiles like bed sheets, pillow cases, comforters, quilts and mattress pads, to bath rugs,

towels, bath robes and area & accent rugs. Its clients include companies operating in the oil and

gas and retail sectors such as Chevron, ExxonMobil, Walmart, and Target.

Credit Rating: -

Short Term Rating – IND A1+ and Long Term Rating – IND AA-

Company in terms of Revenue and Profit (Millions)

Incur losses in 2011 is due to the increase in production capacity of Towels, Bath rugs and

Bed Linen.

Sudden decrease in PBT in 2014 is due to the change in depreciation policy from straight

Line to reducing balance method and has taken additional one time depreciation of Rs 463.1

Crore.

Reason for the improved margins in 2015 is the advantage of cheaper Indian cotton as

china’s cotton price is 40-45% higher than India and Pakistan and also cheap labour in India.

Key Highlights

Welspun Q4 profit doubles, EBITDA jumps by 56%.

Margin will further improved if FTA with Europe because it will attract duty of 8%- 9% in

European countries.

Overall Eye 22% margins, growth in FY 2015-16.

Type Public Company

Founded 1985, Mumbai

Chairman B.K. Goneka

M.D. Mr R.R. Mandawewala

Headquarters Mumbai, Maharashtra

Welspun India Limited, part of US $3.5 Billion Welspun Group

PARTICULARS (31st March 20) 2015 2014 2013 2012 2011

Total Revenue 44075.62 35312.02 30921.18 26285.83 20893.40

EBITDA/PBIDT 11326.75 8,113.39 4900.20 4511.12 1556.46

PBT 6857.48 446.33 2271.64 1885.18 -648.36

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Welspun Product Portfolio

Bath Robes

Terry Towel

Advanced Textiles

Basic & Decorative

Bedding

Bath Rugs

Bed Sheets & Pillowcases

Terry Towel

• Capacity- 45,000 MT/Year

• Cap Utilisation= 99%

Bed Linen Products-Bed sheets

• Capacity- 55 million MTr/Year

• Cap Utilisation= 89%

Bath Rugs & Carpets

• Capacity- 12,000 MT/Year

• Cap Utilisation= 68%

Major Clients of Welspun in Retail – Chevron, Walmart, Target etc.

Welspun is selling its product through Welspun Global Brands Ltd and Welspun Retail Ltd.

Retail Mantra – ‘’One stop shop’’

70% of their Revenue comes from U.S.A.

Key Markets (where Welspun sell) – U.S.A., Canada, U.K., Europe, Japan.

Stock Market Performance in 2015 i.e. 7 times increase in the share price.

(From Rs 106.3 to Rs 709.9)

Production Capacities

Product Range

Financial Analysis

Stock Price

Stock Price 2015 2014 2013 2012 2011

Stock Price (Rs) 709.90 106.30 73.45 48.50 46.90

In 2015, more than 7 times increase in share price as compared to previous year and it has been

analysed that company is focused towards its performance in the stock market and giving high

returns to the shareholders.

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4.09

4.07

4.47

5.47

5.11

2015 2014 2013 2012 2011

% Finance Cost to Revenue

Finance Cost

Loan Portfolio

Secured Loan Unsecured Loan

Rupee term Loans from bank Loan from others

Foreign Currency Loans from Bank Loan from Bank

Working Capital loans from bank Working Capital loans from bank

Inter Corporate Loan

Finance Cost

Particulars Welspun (Million)

2015 2014 2013 2012 2011

LTB 14421.63 14989.22 10231.76 12262.88 12574.00

STB 7380.90 8123.70 6700.27 4917.51 4632.18

% Finance Cost to Revenue 4.09 4.07 4.47 5.47 5.11

Gross Debt as on March 31st 2015 stands at Rs 21,802 million at the end of FY 2015 as against Rs

23,112 million at the end FY-14.

Ratio Analysis

Debt Service Coverage Ratio: 2.67 Times

Interest Service Coverage Ratio: 5.36 Times

Debt Equity Ratio: 1.72 Times

Company increased its borrowing from banks with focus to increase its capacity and investing

heavily in Fixed Asset and Technology because in 2014 there is an increase of more than 43% in

Long term borrowings. Company's operating profit margins, which have grown to 26% in FY15 from

18% in FY13. In comparison, its peers had average operating profit margins of close to 15% in

FY15. On the valuation front, considering FY16 earnings, the company is trading at price-to earnings

multiple of 10 times

Analysed other details from website: www.welspunindia.com

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23 | P a g e

Vardhman Textile Industry

Vardhman Group is a leading textile conglomerate in India having a turnover of $1.1 bn. Spanning

over 22 manufacturing facilities in five states across India, the Group business portfolio includes

Yarn, Greige and Processed Fabric, Sewing Thread, Acrylic Fibre and Alloy Steel.

Vardhman has evolved through history from a small beginning in 1965 into a modern textile major

under the leadership of its chairman, S.P.Oswal. His vision and insight has given Vardhman a highly

respected position in the textile industry. Under his leadership, Vardhman is efficiently using

resources to innovate, diversify, integrate and build its diverse operations into a modern enterprise.

Credit Rating:

Short Term Rating – CARE A1+ and Long Term Rating – CARE AA-

Company in terms of Revenue and Profit (Millions)

PARTICULARS (31st March) 2015 2014 2013 2012 2011

Total Revenue 58871.00 52253.00 42146.00 39785.00 36500.00

EBITDA/PBIDT 10996.00 13253.00 8830.00 5533.00 9444.00

PBT 4892.00 8793.00 4548.00 1454.00 6086.00

Company’s revenue consistently growing by 9% over the five years, except 2014 and highest profit in 2014. Having recently expanded our spinning, weaving and processing capacities, expect to focus on capacity consolidation in the current year, optimising asset utilisation, quality, efficiencies and relationships.

Key Highlights

Vardhman Group of companies is a major integrated textile producer in India.

Vardhman Group has expanded and is today the largest textile conglomerate in India.

27% Contribution to India’s total foreign exchange earnings with US$ 41.57 billion 2013-14.

49 million Spindles capacity across 1,300 mills.

2nd largest employment generator, providing direct employment to 45 million and 60 million people indirectly.

108 USD billion – current size of Indian Textile Sector.

Type Public Company

Incorporated 1973

M.D./Chairman S.P. Oswal

Headquarters Ludhiana, Punjab

Net income US 1.1 Billion

24 | P a g e

14% Contribution to India’s total industrial production.

Currently Vardhman owns the 2nd largest brand of specialized threads in the country.

Production Capacity

1048160 spindles Yarn

450 Metric tons/ day Yarn & Fabric Dyeing

1300 shutleless Looms

115mm meter pa processed Fabric

34 tonnes/ day sewing thread

20,000 metric tonnes acrylic fabric

120000 tonnes alloy steel

Product Range

Financial Analysis

Stock Price

In 2015, stock price of Vardhman showed an increase of almost double the stock price of previous

year.

Loan Portfolio

Secured Unsecured

Term loan Fixed Deposits

working capital From Banks

Particulars USD Million % share

Yarn 550.3 49.51%

Fabric 322.7 29.04%

Sewing Thread 111.2 10.00%

Steel 75 6.74%

Power plant 0.5 0.05%

Fibre 45.7 4.12%

Garment 6.2 0.56%

Total 1111.4 100%

Stock Price 2015 2014 2013 2012 2011

Stock Price (Rs) 702.80 365.00 286.00 207.75 278.90

25 | P a g e

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Finance Cost

Finance Cost

Particulars Vardhman (Million)

2015 2014 2013 2012 2011

LTB 14071.00 23916.00 25491.00 23143.00 21164.00

STB 4685.50 8355.00 7576.50 5115.40 8646.80

% Finance Cost to Revenue 2.06 2.8 4.1 4.3 3

The Company successfully curtailed working capital usage to about 60% of sanctioned limits.

Vardhman % Finance cost to Revenue is Low as compared to other competitors only because of less than 1 debt to equity ratio. Over the five years, Vardhman debt to equity is consistently less than 2 and less than 1 in 2015 i.e. 0.6% means company is financing very less from Debt as in chart there is a sharp decrease in borrowing as compared to previous years.

Company utilises the money from Reserves & Surplus for the Long term financing.

Company issues interoperate loan from subsidiaries for Short term Financing. Gross Debt as on March 31st 2015 stands at Rs 18,756 million at the end of FY 2015 as against Rs

32271 million at the end FY-14.

Short Term Borrowings (2014) From banks interest @ 9.95% to 12.70% p.a. (Previous Year 9.70% to 12.50% p.a) ii) From related parties carries interest @ 9% to 10.25% p.a. (Previous Year 9.50% to 10% p.a.) iii) From others carries interest @ 12.50 % p.a. (Previous Year 10.50% p.a)

The company is expanding its fabric capacity by doing a capex of around Rs 400 Crore in two phases. This capex would enhance its operating margins from 18% in FY15 to 20-22% in the next two years. This growth in margin will be largely driven by fabrics division as demand for processed fabric is rising. In the northern region, Vardhman Textiles is one of the most efficiently managed companies with debt-equity ratio of less than one Considering FY16 earnings, the company is trading at a price-to-earnings multiple of eight times.

Analysed other details from website: www.vardhman.com

26 | P a g e

Nahar Spinning Mills Limited

Spinning Mills Limited started out as worsted Spinning & Hosiery unit in Ludhiana. It was

incorporated as a Private Limited company in December, 1980 and became a Public Limited

Company in 1983. The steady growth in manufacture and Export of woollen/cotton hosiery

knitwear’s and woollen textiles enabled the company to earn the recognition as an “Export House”

followed by a “Recognized Trading House” by the Government of India. An ISO 9002 company, the

Company has 7 multi-location plants, a range of products, over 60% of which is aimed at export

markets – USA, UK, France, Brazil, Bangladesh, Mauritius, Honduras, Argentina, Colombia, Peru,

Chile, Netherlands, Japan, Canada, Korea, Taiwan, Hong Kong, Singapore, Egypt and Russia.

The Company's mantra "World is our markets" is truly reflected in its operations. The Company is

one of the largest integrated textile player in India. The Management vision coupled with company's

inherent strength in terms of cost and quality has enabled the company to become the second

largest Cotton Yarn manufacturer in India.

Credit Rating: CRISIL A+

Company in terms of Revenue and Profit (Millions)

PARTICULARS (31st March) 2015 2014 2013 2012 2011

Total Revenue 21496.09 22041.80 19694.00 17055.00 140621.52

EBITDA/PBIDT 2248.80 3571.30 3243.60 211.00 2963.30

PBT 148.30 2045.00 1340.50 -1734.00 1779.30

In 2012, a worst year for the spinning industry and company's performance was also affected in the year. Though company's operating income increased to Rs.1691.42 crores from Rs.1388.75 crores showing an impressive increase of 17.89% over the previous year but it suffered a heavy loss of Rs.117.20 crores during the year under review. During the cotton season but the cotton prices went up steeply during the season 2010-2011 due to export of huge quantity of cotton during the peak cotton season. Thus the Spinning Mills were forced to buy good quality cotton at abnormally higher prices during the season. However in April, 2011 the sudden crash of raw cotton prices coupled with decline in the prices of finished goods in the domestic as well as overseas markets severely affected the financial performance of the company.

Type Public Company

Founded 1980

M.D. Mr Dinesh Oswal

Headquarters Ludhiana, Punjab

27 | P a g e

Key Highlights

Include the “National Export Trophy” by the Apparel Export Promotion Council.

Latest is the Gold Trophy for highest Exports of Yarn 50s & below in Yarn Category by

TEXPROCIL for the year 2010-2011 and ‘AEPC Export Awards for Highest Exports in Cotton

Garment in the year 2008-09 and 2009-10.

Nahar selling its product through Monte Carlo Brand.

Company is into the Yarn and Garment segment.

Production Capacities

The present spindlage capacity of the company is 5.00 Lacs (approx.) spindles and 1080

Rotors.

As a measure of further value addition in the Company's product the Company has put up a

Mercersing cum dyeing plant with a capacity of 4.5 M.T. per day at Village Lalru, S.A.S.

Nagar, and Punjab.

Product Range

Yarn Knitted Garments

Textile Yarn Woven Fabrics

Financial Analysis

Stock Price

Stock Price 2015 2014 2013 2012 2011

Stock Price (Rs) 122.20 104.00 85.85 88.59 99.70

Loan Portfolio

Secured Loans

Term Loan from banks

Working Capital Loan from banks

Finance Cost

Particulars Nahar (Millions)

2015 2014 2013 2012 2011

LTB 4361.10 4559.00 4271.90 4764.80 4332.40

STB 6230.10 7031.10 7996.80 7319.00 9022.40

% Finance Cost to Revenue 3.6 2.9 5.2 6.4 3.4

28 | P a g e

3.6

2.9

5.2

6.4

3.4

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% Finance Cost to Revenue

Finance Cost

Gross Debt as on March 31st 2015 stands at Rs 10591.2 million at the end of FY 2015 as against

Rs 11590.1 million at the end FY-14.

Over the five years company’s average finance cost to revenue is 4.3% but in 2012 finance cost to

revenue is 6.4% because of imbalance in the market conditions, an increase in cotton price leads

to Spinning Mills were forced to buy good quality cotton at abnormally higher prices during the

season.

Ratio Analysis

Company’s Debt to equity is less than 1 but in 2015 is 1.40.

Interest coverage ratio is 5.54.

Current ratio 3.50% and Quick ratio 1.74%.

Nahar Interest on Secured Term Loans from banks in 2014

State Bank of India @11.50% -10.45%

State bank of Patiala @11.25%

Punjab National Bank @10.75%

Oriental Bank of Commerce @11.25%

Canara Bank @11%

IDBI Bank Ltd @11%

Allahabad Bank @11%

Analysed other details from website: www.nahar.com

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29 | P a g e

Alok Industries

Alok was established in 1986 as a private limited company, with first polyester texturizing plant being

set up in 1989. Alok became public limited company in 1993. Over the years, Alok has expanded

into weaving, knitting, processing, home textiles and garments. And to ensure quality and cost

efficiencies that integrated backward into cotton spinning and manufacturing partially oriented yarn

through the continuous polymerisation route.

Alok has a strong foothold in the domestic retail segment through a wholly owned subsidiary, Alok

H&A Limited, under the cash & carry model that offer garments and home textiles at attractive price

points. Alok also has an international presence in the retail segment through its associate concern,

Grabal Alok (UK) Limited. This entity owns more than 200 outlets across England, Scotland and

Whales vending value for money ranges for menswear, women’s wear, children wear, footwear,

home ware and accessories.

Alok Industry due to consolidation presented their 2013 and 2015 reports for 18 months.

Credit Rating: CRISIL ‘A-/Stable’

Company in terms of Revenue and Profit (Millions)

PARTICULARS (31st March 20) 2013-15 (18) 2013 (18 ) 2012 2011

Total Revenue 223555.40 202596.60 89664.60 64295.20

EBITDA/PBIDT 52704.10 50213.30 25034.80 18382.50

PBT 5580.40 13999.00 6405.00 5831.90

Product Range

Apparel Fabrics

Woven and knits

Bed Linens and Towels

Garments

Polyester Yarn business

Type Public Company

Founded 1986

Industry Textile, Retail & Real estate.

M.D. Mr Dilip B. Jiwrajka

Headquarters Mumbai, Maharashtra

Net income US $2.1 Billion (2014)

30 | P a g e

Physical Capacities

Spinning 80,000 Tons

Sheeting fabric 150 mm metres

Terry towel 13400 Tons

Woven Fabrics 186 mm metres

Knits 25000 tons

Garments 22 mm pcs

Continuous Polymerisation 520000 Tons

Current Capacity 60,000 tons ring spun yarn

20,000 tons open-ended yarn

Alok is in every stage from Fibre to Garments.

In home textile segment, Alok is mainly present in the export market (99% exports) where it faces competition from Chinese, Pakistani and Turkish manufacturers.

Raw material Procurement Procurement of raw cotton at right price and during harvest remains crucial. Looking at the volatility in the prices of cotton in the recent past, the company tries to maintain an inventory holding to the extent of 3-4 months requirement matching its average sales order book which is also 3-4 months for apparel fabrics, home textiles and garments. Thus, it has in-built risk mitigation for cotton price fluctuation. Further, due to its integrated operations cotton constitutes about 27% – 28% of its fabric selling price and thus has limited impact on the overall operations

Financial Analysis

Stock Price

PARTICULARS (31st March 20) 2013-15 (18) 2013 (18) 2012 2011

Stock Price (Rs) 7.10 8.25 21.90 -

Loan Portfolio

Secured Unsecured

12% - 14.50% Debentures Foreign Currency Loan

Term Loans

Rupee Loan

Foreign Currency Loan

Financial Institution

Vehicle Loans from bank

31 | P a g e

14.5

11

12.8

11.4

2015 2013 2012 2011

% Finance Cost to Revenue

Finance Cost

Finance Cost

Particulars Alok Industries

2015 2013 2012 2011

LTB 20790.80 23841.30 16327.40 9235.80

STB 60440.90 45605.80 41264.20 28461.60

% Finance Cost to Revenue 14.5 11.0 12.8 11.4

Gross Debt as on March 31st 2015 stands at Rs 81231.7 million at the end of FY 2015 as against Rs 69447.1 million at the end FY-14 Alok Industry finance cost is highest among all the competitors of Trident and company is paying high interest and from the above chart it is clear that company is borrowing more for short term.

Debt to Equity for long term loans decreased from 1.61 in the previous year to 1.22 in the current year. Total debt to equity ratio reduced from 2.99 in the previous year to 2.72 in the current year due to reduction in Long term borrowing.

Operating EBIDTA/Interest indicates the Company’s ability to service its debt costs through profits. Operating EBIDTA/Interest decreased from 2.27 in the previous year to 1.62 in the current year

Current ratio was 1.58 in the current year compared to 1.49 in the previous year

Inventory turnover increased from 158 days in the previous year to 205 days in the present year. Debtor turnover increased from 136 days in the previous year to 186 days in the current year.

Alok Rate of interest

Secured Rupee Term Loan from Banks – 11.55% - 15.75% (12% - 15.75%)

Secured Foreign Currency Term Loan from Banks – 1.27% - 7.35% (1.44% - 6.00%)

Secured Rupee Term Loan from Financial Institutions – 9.00% - 15.00% (9.00% - 12.50%)

Secured Foreign Currency Term Loan from Financial Institutions – (2.96% - 5.40%)

Unsecured Foreign Currency Term Loan from Banks – 3.25% - 4.25% (2.88% - 3.50%)

Analysed other details from website: www.alokind.com

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32 | P a g e

Pulp and Paper Industry Competitor Analysis

The pulp and paper industry comprises companies that use wood as raw material and

produce pulp, paper, board and other cellulose-based products. The industry is dominated by North

American (United States and Canada), northern European (Finland, Sweden, and North-West

Russia) and East Asian countries (such as East Siberian Russia, China, Japan, and South

Korea). Australasia and Brazil also have significant pulp and paper enterprises. The United States

had been the world's leading producer of paper until it was overtaken by China in 2009.

Potential and Growth of Paper industry in 21st Century The paper industry in India could be classified into three categories according to the raw material

consumed.

Wood based

Waste paper based

Agro based

The Indian paper industry produces 10.11 million tons paper per annum, just 1.6% of the total world

production of 394 million tons, paperboard and newsprint. Needless to say, at present, India lags

far behind compared to international standards. The Scandinavian countries, USA, Russia, China,

Indonesia and Japan are the major players in the field of pulp and paper. These countries have

some of the best available raw material for paper production and state-of-the-art technology

Paper Competitor’s Performance in Stock Market as on 2015.

Source: - www.moneycontrol.com

The stock market is one of the most important way for companies to raise money, along with debt

market which are generally more imposing but do not trade publicly. This allows businesses to be

publicly traded, and raise additional financial capital for expansion by selling shares of ownership of

the company in a public market.

This part involves the comparison of Trident with 3 of its Key competitors in paper industry

Tamil Nadu Newsprint and Paper Limited (TNPL)

Ballarpur Industries Limited (BILT)

J.K. Paper

Below the comparisons are given with all the key competitors of Trident in Paper Industry.

Stock Price (Rs) Market Cap (Billion)

Trident 24.60 11.98

TNLP 156.10 10.90

J.K. Paper 32.35 4.42

BILT 12.55 8.26

33 | P a g e

Tamil Nadu Newsprint and Paper Limited (TNPL)

The Tamil Nadu Newsprint and Papers Limited (TNPL) was established by the Government of Tamil

Nadu to produce newsprint and writing paper using bagasse, a sugarcane residue. The Government

of Tamil Nadu listed the paper mill in April 1979 as one of the most environmentally compliant paper

mills in the world under the provisions of the Companies Act of 1956.

Credit Rating:

Short Term – IND A1 & Long Term – IND A+

Company in terms of Revenue and Profit (Millions)

Production Capacity

PARTICULARS (31st March) 2014 2013 2012 2011

Production Capacity (Tonnes per annum )

400000

Paper Production (Metric tonnes) 387714 371637 343306 265044

Plant Location – Kagithapuram, Karur District, Tamil Nadu.

Exports about 1/5th of its production to more than 50 countries.

Type Government-owned corporation

Industry Bagasse-based paper mill

Founded 1979

M.D. Thiru. C.V. Shankar, IAS

Headquarters Chennai, Tamil Nadu, India

Owner Government of Tamil Nadu

Parent

Department of Industries (Tamil Nadu)

PARTICULARS (31st March) 2015 2014 2013 2012 2011

Total Revenue 21357.00 22852.00 18811.80 15390.00 12250.00

EBITDA/PBIDT 5223.60 5232.00 4220.70 4354.30 3627.40

PBT 2301.30 2026.70 1261.10 1251.10 1951.40

34 | P a g e

40%

30%

30%

TNPL Raw Material Usage

Paper Based Agro Based Recycled Fibre

Separate business unit concept (SBUC) which Trident is also using.

Manufactures Eco- Friendly paper which Trident is also doing by less usage of wood.

Product Range

Surface Sized Varieties Non Surface Sized Varieties

Print vista Cream wove

Pigmented Paper Hi-tech Maplitho

Elegant Printing Radiant Printing

Super print Maplitho Ace Marvel

Offset Printing

Key Projects under implementation

Revamping of steam and power system (RSPS).

De-inking Plant.

On site Precipitated Calcium Carbonate (PCC) Plant.

On site wet Ground Calcium Carbonate (WGCC) Plant.

Lime Sludge and Fly ash Management (600 TPD Cement Plant)

TNPL, being a government owned company, is crystalline and all the information is available

in public domain.

Operational Analysis

Raw material procurement

TNPL uses sugarcane waste as its key procurement i.e. Bagasse (a renewable raw material

consumes less chemical for pulping and bleaching

Sugar Mills TNPL

Barter

System

Supplies (Bagasse)

Supplies (Steam/Fuel)

35 | P a g e

Fly Ash

Lime Sludge

High Grade Cement

(TNPL)

Trident is the world’s largest wheat straw based paper producer (wheat straw is a waste which

comes out of production of wheat) and is the key procurement for the production of paper.

Raw Material Procurement through Schemes of:

Farm Forestry

Captive Plantation

Farm Forestry is about tree plantation in private lands with buy back arrangement. The scheme

has enthused many farmers to grow pulpwood trees in their dry lands.

Captive Plantation cultivates pulpwood in the lands belonging to individuals and institutions on

‘’Lease’’ or ‘’Revenue sharing’’ basis.

Solid Waste Management

Cement produced 113904 Tonnes (2014) which is used for internal purposes.

Financial Analysis

Stock Price

Loan Portfolio

Secured Loans Unsecured Loans

11% Non-Convertible Debentures Pre shipment Credit

8.75% Non-Convertible Debentures Buyers' Credit

FCNR Rupee Loan

Rupee Term Loans Fixed Deposit

Foreign Currency Loans Commercial Paper

Cash Credit

Buyers' Credit

Short Term Loan

Schemes 2014 2013 2012 2011

Farm Forestry (Farmers) 18709 17021 15018 12012

Captive Plantation (Acres) 100185 91711 82025 66599

PARTICULARS (31st March 20) 2015 2014 2013 2012 2011

Stock Price (Rs) 162.25 130.00 101.00 141.75 103.80

36 | P a g e

7.2

5.33

6.43

9.17

3.6

2015 2014 2013 2012 2011

% Finance Cost to Revenue

Finance Cost

Finance Cost

Particulars TNLP (Million)

2015 2014 2013 2012 2011

LTB 14079.42 10247.00 10043.50 11503.60 10817.80

STB 4752.80 4504.00 4958.50 5604.10 4063.10

% Finance Cost to Revenue

7.20 5.33 6.43 9.17 3.60

Gross Debt as on March 31st 2015 stands at Rs 18832.2 million at the end of FY 2015 as against Rs 14751 million at the end FY-14 TNPL’s is focusing on Mill Expansion Plan and Mill Development Plan and to finance these plans,

TNPL is borrowing from different sources.

The expansion schemes are funded through an appropriate mix of internal generation and borrowed funds taking into account the cash generation potential from the existing facilities and expansion schemes. The average cost of

Long term loan availed as on 31.3.2014 is 8.87 %. (31.3.2013: 7.74%)

Working Capital loans 10.19% (31.3.2013: 9.81%).

Overall cost is 9.28 % (31.3.2013: 8.42%).

The increase is due to the increase in base rates by the Banks and repayment of old low cost loans as per amortization schedule. TNPL, has implemented a sound Forex Risk Policy and thereby has minimized the currency risks in forex transactions.

Analysed Other Details from Website: - www.tnpl.com

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37 | P a g e

Ballarpur Industries Limited (BILT)

Ballarpur Industries Limited (BILT), part of the US$ 3 billion Avantha Group, is India’s largest

manufacturer of writing and printing (W&P) paper. More than 50% of India’s coated wood-free

grades roll out of BILT’s state-of-the-art plants.

The company holds an impressive

85% share of the bond paper market and

45% share of the hi-bright Maplitho market in India.

Credit Rating:

Long Term – IND A+ and Short Term – IND A1+

Company in terms of Revenue and Profit (Millions)

PARTICULARS (31st March) 2015 2014 2013 2012 2011

Total Revenue 4522.60 9548.70 9883.30 10995.00 10650.00

EBITDA/PBIDT 693.00 1356.20 1612.20 1284.30 1719.50

PBT -110.40 101.40 376.90 122.00 504.40

Physical Capacities

PARTICULARS (31st March) 2014 2013 2012 2011

Production Capacity (Tonnes per annum ) ----------------------------Not Given---------------------------

Paper Production (Metric tonnes) -----------Not Given-------- 846230 840429

Focuses on Penetration

Company is investing heavily in the fixed assets through Loans and issuing of shares. Premier Tissues India Limited (PILT) is 100% acquired by BILT because BILT focuses on North India market and PILT focuses on Southern and Western market.

Type Public company

Founded 1945

Founder Lala Karamchand Thapar

Headquarters Gurgaon, India

CEO Gautam Thapar (Chairman)

Revenue US$ 1 Billion

38 | P a g e

Trident Group is more focused towards terry towel and yarn business, are leaders in that segment and also focusing on paper unit by showing a jump of 13.70% in revenue. (2014)

Product Range

Coated Wood Free Uncoated Wood Free Copier

Blade Coated Magna Maplitho Paper

Air Knife Wisdom Print

Cash Coated Sunshine Superior Paper Cream wove

Natural shade deluxe

Operational Analysis Raw Material Procurement -Rayon Grade pulp. -Farm Forestry scheme. BILT is the only Indian Company to have access to its own plantations outside India with SFI’s 288,138 hectares of licensed plantations and forests. It also has access to procuring from farmers in India through its social farm forestry programme, which has been developed over several years. BILT is now fully self-sufficient in hard-wood pulp production with three of the five units having integrated pulp producing facilities. Solid Waste Management Objective-To convert waste into organic manure & promote its use with farmers. Tissue Paper business operated through its subsidiary Premier Tissues Limited. These businesses target the industrial and FMCG markets. Retail Sector BILT continued to focus on its distribution infrastructure to support large scale distribution as well as to improve reach and availability. The products are presently marketed across India through a well-established network of more than 300 distributors, reaching in excess of 40,000 retail outlets. P3 is a unique offering that successfully combines world class stationery merchandise, convenience of buying & price integrity and direct office sales. BILT continues to rapidly scale up this relatively new business line by primarily leveraging its robust product portfolio, strong and efficient delivery capability on a pan-India basis and its own heritage of paper and printing expertise. P3- Paper, Pen and Print. Financial Analysis Stock Price

PARTICULARS (31st March 20) 2015 2014 2013 2012 2011

Stock Price (Rs) 14.10 21.80 16.60 22.75 34.75

39 | P a g e

7.9

5.64.3

2.4

3.5

2015 2014 2013 2012 2011

% Finance Cost to Revenue

Finance Cost

Loan Portfolio

Secured Loans Unsecured Loans

Debentures Fixed Deposits

Financial Institutions Zero Coupon Convertible Bonds

Non-Convertible Debentures

Finance Cost

Gross Debt as on March 31st 2015 stands at Rs 10505.6 million at the end of FY 2015 as against Rs 10018.7 million at the end FY-14 BILT has also evolved appropriate corporate structures to raise capital at optimal cost. The International Finance Corporation (IFC) announced a proposed investment in BILT Paper B.V., the step down international subsidiary of BILT. This comprises a combination of an equity investment of US$ 100 million and long term loans of up to US$ 150 million. The announcement is part of IFC’s standard practice of publicly announcing a proposed investment two months prior to its actual execution. This flow of international capital into BILT’s system will help optimise capital costs and reduce pressure on debt servicing.

The average cost of: Secured Loans

Non-Convertible Debentures is 8.75% to 9.90%

Debentures is 11.75%

External Commercial Borrowings is LIBOR + 3.3% Unsecured Loans

Non-Convertible Debentures is 9.60% & 9.90%

Analysed Other Details from Website: - www.bilt.com

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LTB STB Finance Cost

Particulars BILT (Millions)

2015 2014 2013 2012 2011

LTB 5371.20 5179.20 4715.00 4150.20 5567.40

STB 5134.40 4839.50 4021.50 3357.30 4261.50

% Finance Cost to Revenue 7.9 5.6 4.3 2.4 3.5

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J.K. Paper Ltd

JK Organisation is India’s largest producer of Branded Papers and a leading player in Coated Papers and High-end Packaging Boards. The Company began its journey more than half a century ago with 18,000 tons per annum capacity paper plant. It has grown over the years and maintained its quality leadership position. JK Paper has been constantly creating value in a highly capital intensive and cyclical business, where volume is traditionally considered as Key profit driver. Most companies concentrated on increasing capacity, JK Paper responded with a Brand driven strategy, with customer at its heart.

Credit Rating:

Long term – IND BBB+ and Short Term – IND A2+

Company in terms of Revenue and Profit (Millions)

PARTICULARS (31st March) 2015 2014 2013 2012 2011

Total Revenue 21588.00 17378.00 14709.00 13535.00 12455.00

EBITDA/PBIDT 2664.00 1385.00 1444.10 1763.10 2714.40

PBT -510.30 -1229.40 373.40 521.20 1484.50

Physical Capacities

PARTICULARS (31st March) 2014 2013 2012 2011

Production Capacity (Tonnes per annum ) 455000

Paper Production (Metric tonnes) ------------------------------Not Given-------------------------

Few Years back J.K. Paper was into Copier segment and now diversified into Packaging

board and coated paper segment.

Tie-up with HP (Hewlett Packard) to manufacture and sell ‘’Color Lok’’ Paper. (Have License

to produce).

J.k. Paper uses TPM methodology same as Trident.

In 2011, Expansion Project of Rs 1650 Crore to increase the Pulp and copier capacity.

Type Public Company

Founded 1981

Headquarters New Delhi, India

Founder Lala Juggilal Singhania & Lala Kamlapat

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Product Range

Operational Analysis

Raw Material Procurement

Emphasis on the Farm Forestry Programme this year added an additional 14,877 Ha, which was

almost a third higher than the previous year and our concerted efforts have cumulatively resulted in

plantations of over 1,16,000 Ha since inception of the Farm Forestry Programme.

Solid waste management

Financial Analysis

Stock Price

PARTICULARS (31st March 20) 2015 2014 2013 2012 2011

Stock Price (Rs) 33.30 31.60 31.10 39.80 63.35

Loan Portfolio

Secured Loans Unsecured Loans

11% Debentures Term Loan

8.75% Debentures Rupee Term Loan

Term Loan Pre-Shipment

Cash Credit Buyers' Credit

Buyers' Credit Rupee Loan

Short term Loan Fixed Deposits

Pre shipment Credit

Coated Paper Copier and office paper

Packaging Board Corrugated Board

Bamboo + Hardwood + Pulp + Chemicals

Residue like

Fly Ash Making Products

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9.4

7

3.39 3.74.12

2015 2014 2013 2012 2011

% Finance Cost to Revenue

Finance Cost

Finance Cost

Particulars J.K. Paper (Millions)

2015 2014 2013 2012 2011

LTB 18797.00 17170.00 17675.00 10803.00 5078.80

STB 2441.90 2190.50 1231.40 1306.30 1387.30

% Finance Cost to Revenue 9.40 7.00 3.39 3.70 4.12

Gross Debt as on March 31st 2015 stands at Rs 21238.9 million at the end of FY 2015 as against Rs 19360.5 million at the end FY-14. Over the 5 years company’s finance cost increased due to credit rating and also from increased long term borrowing. 1.255 Foreign Currency convertible bonds at interest rate of 6 months @ EURIBOR + 4.75% (2011) and in 2012 @ 6.455%.

Analysed Other Details from Website: www.jkpaper.com

0

500

1000

1500

2000

2500

0

5000

10000

15000

20000

2015 2014 2013 2012 2011

J.K. Paper (Millions)

J.K. Paper

LTB STB Finance Cost

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Recommendations and Savings

Since, Trident is into the expansion stage and is borrowing money from banks to finance the projects

and for this reason company is incurring high finance cost. Trident can go for many alternative

options to reduce its finance cost. After an in-depth study of competitor, following are the products

which are used by the competitors and which leads their competitor to maintain their finance cost.

Currently Trident’s cost of borrowing is between = 9.90% to 11.45% from Banks

The following are the products used by the competitor:

Non-Convertible Debentures

Commercial Paper

Zero Coupon Convertible Bonds

Debentures

Company Fixed Deposits

Foreign Currency Convertible Bonds

Non-Convertible Debenture

1. Meaning

Non-Convertible Debentures (NCDs) will mean secured, negotiable money market instruments with

original maturity of less than one year issued by corporates (including NBFCs) to meet their short

term funding requirements, issued by way of private placement with investors. The guidelines also

cover NCDs with original maturity of more than one year with optionality attached to it which can be

exercised within a year from the date of issue.

2. Eligible Issuers

Any corporate that fulfils the following criteria are eligible to issue the NCDs of less than one year:

Having a tangible net worth as per the latest audited balance sheet, of not less than Rs.4 Crore.

The company has been sanctioned working capital limit by bank/s or all-India financial institution/s.

The borrowal account of the company is classified as a Standard Asset by the financing bank/s/ institution/s.

3. Rating Requirement

An eligible corporate intending to issue NCDs shall obtain credit rating for issuance of the NCDs from one of the rating agencies, viz.,

Credit Rating Information Services of India Ltd. (CRISIL)

Investment Information and Credit Rating Agency of India Ltd. (ICRA)

Credit Analysis and Research Ltd. (CARE)

FITCH Ratings India Pvt. Ltd.

Or such other credit rating agencies as may be specified by the Reserve Bank of India from time to time, for the purpose.

44 | P a g e

The minimum credit rating shall be P-2 of CRISIL or such equivalent rating by other agencies. The issuers shall ensure at the time of issuance of NCDs that the rating so obtained is current and has not fallen due for review.

4. Maturity

NCDs shall not be issued for maturities of less than 90 days from the date of issue.

The exercise date of option (put/call), if any, attached to the NCDs shall not fall within 90 days period from the date of issue.

The maturity date of the NCD shall co-terminate with the date up to which the credit rating of

the issuer is valid.

5. Denominations

NCDs may be issued in denominations of Rs.5 lakh or multiples thereof. Amount invested by a

single investor should not be less than Rs.5 lakh (face value).

6. Limits and the Amount of Issue of NCDs

The aggregate amount of the NCDs from an issuer shall be within the limit as approved by

the Board of Directors of the corporate or the quantum indicated by the Credit Rating Agency

for the specified rating, whichever is lower.

The total amount of the NCDs proposed to be issued should be raised within a period of two

weeks from the date on which the issuer opens the issue for subscription.

Pros of NCD investment

Interest Rates offered are attractive.

NCD’s are listed on NSE and BSE can be traded in the secondary market similar to trading

in shares and bonds.

Fairly liquid, as most NCD’s are traded. There is no penalty for liquidation.

With interest rates going down, bond prices goes up and vice versa.

Cons of NCD investment

Low Participation – NCD’s trading market lacks broad participation, leading to illiquidity at

times. Situation gets worse if parent companies’ performance is not good.

Rating Errors and Downgrades – These issues are rated by rating agencies which are

prone to errors. If they fail to rate the issue correctly, there are chances of rating downgrades

in future. Rating downgrades can be detrimental to investors return.

Interest Rate Sensitivity – Changing interest rates affect the price of NCD’s. Price sensitivity

bears an inverse relationship with the direction of interest rate movement. If the interest rates

go up, price of the NCD falls and vice versa. As NCD’s are traded in secondary market, prices

adjust quickly to changing interest rate scenario and adjustment in negative direction means

loss to the investor.

Commercial Paper

1. Meaning

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Commercial Paper (CP) is an unsecured money market instrument issued in the form of a

promissory note. CP, as a privately placed instrument, was introduced in India in 1990 with a view

to enable highly rated corporate borrowers to diversify their sources of short-term borrowings and

to provide an additional instrument to investors. Subsequently, primary dealers (PDs) and all-India

financial institutions (FIs) were also permitted to issue CP to enable them to meet their short-term

funding requirements. The guidelines for issue of CP, incorporating all the amendments issued till

date, are given below for ready reference.

2. Eligibility for Issue of CP

Companies, PDs and FIs are permitted to raise short term resources through CP. A company would be eligible to issue CP provided

Tangible net worth of the company, as per the latest audited balance sheet, is not less than Rs.4 core.

Company has been sanctioned working capital limit by bank/s or FIs.

Borrowal account of the company is classified as a Standard Asset by the financing bank/institution.

3. Rating Requirement

Eligible participants/issuers shall obtain credit rating for issuance of CP from any one of the SEBI registered CRAs. The minimum credit rating shall be ‘A3’ as per rating symbol and definition prescribed by SEBI. The issuers shall ensure at the time of issuance of the CP that the rating so obtained is current and has not fallen due for review.

4. Tenor

CP shall be issued for maturities between a minimum of 7 days and a maximum of up to one year from the date of issue.

The maturity date of the CP shall not go beyond the date up to which the credit rating of the issuer is valid.

5. Investment / Redemption

The investor in CP (primary subscriber) shall pay the discounted value of the CP to the account of the issuer through the IPA.

The investor holding the CP in physical form shall, on maturity, present the instrument for payment to the issuer through the IPA.

The holder of a CP in dematerialised form shall get the CP redeemed and receive payment through the IPA.

5. Buyback of CP

Issuers may buyback the CP, issued by them to the investors, before maturity.

Buyback of CP shall be through the secondary market and at prevailing market price.

The CP shall not be bought back before a minimum period of 7 days from the date of issue.

Issuer shall intimate the IPA of the buyback undertaken.

Pros of Commercial paper

It is quick and cost effective way of raising working capital.

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Best way to the company to take the advantage of short term interest fluctuations in the market

It provides the exit option to the investors to quit the investment

They are cheaper than a bank loan.

As commercial papers are required to be rated, good rating reduces the cost of capital for the company.

It is unsecured and thus does not create any liens on assets of the company.

It has a wide range of maturity

It is exempt from federal SEC and State securities registration requirements.

Cons of Commercial paper

It is available only to a few selected blue chip and profitable companies.

By issuing commercial paper, the credit available from the banks may get reduced.

Issue of commercial paper is very closely regulated by the RBI guidelines.

Zero Coupon Convertible Bonds

These are debt convertible into equity shares of the issuer. If investor choose to convert, they forgo

all the accrued and unpaid interest. These convertible are generally issued wit put option to the

investors. The advantage to the issuer is the raising of convertible debt without heavy dilution of

equity. Since the investors give up acquired interest by exercise of conversion option, the conversion

option may not exercise by many investors. The investors gains in the event of appreciation in the

value of the equity shares. Even if the appreciation does not materialize, the investor has the benefit

of a steady stream of implied income. If the instrument is issued with put option, the investor can

resell the securities to the investor.

The zero-coupon and convertible features offset each other in terms of the yield required by investors. Zero-coupon bonds are often the most volatile fixed-income investments because they have no periodic interest payments to mitigate the risk of holding them; as a result, investors demand a slightly higher yield to hold them. On the other hand, convertibles pay a lower yield compared to other bonds of the same maturity and quality because investors are willing to pay a premium for the convertible feature.

Debentures

Meaning

If a company needs funds for extension and development purpose without increasing its share capital, it can borrow from the general public by issuing certificates for a fixed period of time and at a fixed rate of interest. Such a loan certificate is called a debenture. Debentures are offered to the public for subscription in the same way as for issue of equity shares. Debenture is issued under the common seal of the company acknowledging the receipt of money.

Features of Debentures:

Debenture holders are the creditors of the company carrying a fixed rate of interest.

Debenture is redeemed after a fixed period of time.

Debentures may be either secured or unsecured.

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Interest payable on a debenture is a charge against profit and hence it is a tax deductible expenditure.

Debenture holders do not enjoy any voting right.

Interest on debenture is payable even if there is a loss.

Pros of Debentures

Issue of debenture does not result in dilution of interest of equity shareholders as they do not have right either to vote or take part in the management of the company.

Interest on debenture is a tax deductible expenditure and thus it saves income tax.

Cost of debenture is relatively lower than preference shares and equity shares.

Issue of debentures is advantageous during times of inflation.

Interest on debenture is payable even if there is a loss, so debenture holders bear no risk.

Cons of Debentures

Payment of interest on debenture is obligatory and hence it becomes burden if the company incurs loss.

Debentures are issued to trade on equity but too much dependence on debentures increases the financial risk of the company.

Redemption of debenture involves a larger amount of cash outflow.

During depression, the profit of the company goes on declining and it becomes difficult for the company to pay interest

Company Fixed Deposits

Apart from banks there are companies in India that accept money from general public for a fixed term and pay interest. These companies are authorized by the Reserve Bank of India to perform these tasks under specified regulations of RBI. However RBI does not guarantee on any sort of transactions or trades entered into with these institutions. In other words the institutions are not actually backed by the Reserve bank. There are set of guidelines and instructions from RBI to investors who are willing to invest in NBFCs. These instructions can help protect a person’s interest in investing in these companies. Fixed deposit scheme is one of the schemes that are offered by NBFCs and there are specific permissions required to offer these schemes to public apart from regular authorization.

1. Term The term of company fixed deposits are usually less because when it comes to these deposit schemes the performance of the company and rating may change with time. So as a matter of insecurity shorter terms are preferred. The term as regulated by RBI cannot be less than 12 months or more than 5 years.

2. Types of company FD

There are two types of fixed deposit schemes namely cumulative and non-cumulative fixed deposit

schemes. Non-Cumulative schemes as the name suggests pay off the interest earned on investment

on regular basis (half yearly basis or annual basis) so the interest will not get acquired on principal

to earn higher interest in the years to come. Cumulative fixed deposit scheme on the other hand

48 | P a g e

where the interest accumulates with principal so as to earn higher returns when compared to non-

cumulative plan. This scheme pays interest accrued on deposit schemes on maturity of the deposit.

3. Rating of a company

There are certain institutes (CRISIL, ICRA etc.) that rate a company based on net owned fund (NOF)

of the company. The companies are rated based on certain ceilings and slabs (ex: NOF more than

200 lakhs be rated in certain category) and based on the rating a person may decide whether he

should invest or not in a company.

4. Interest rates

Interest rates on fixed deposit schemes offered by a company are higher than regular banks. This

is one of the major reasons that people are interested in these schemes these days. The interest

rate offered on the FDs is limited to a maximum of 12.5% by the Reserve bank of India and this

figure can vary with time. A person has to stay updated about this information before depositing in

these schemes. The interest rates available today in market range from 9% to about 12.25%.

(Coupon)

5. Pre-mature withdrawals

Premature withdrawals are permitted in these schemes and the lock in period of these schemes will

be 3 months. Interest accrued and penalties are as per the terms and conditions of the company.

Pros of Company fixed deposit:-

There are few benefits of company fixed deposit that makes it preferable over other

counterparts.

Interest rates in general are 2 to 3% higher than bank fixed deposits

On a short term they earn better income with good liquidity

The deposit scheme also has nomination facility

The application process and eligibility clauses are much simpler than those of regular bank

fixed deposit scheme

Foreign Currency Convertible Bonds

FCCB or the Foreign Currency Convertible Bonds is a type of convertible bond issued in a currency

different than the issuer’s domestic currency. It can be regarded as an instrument used to raise

money by the issuing company in the form of a foreign currency. A convertible bond is

a debt instrument with equity flavours in it, as it acts like a bond by making regular coupon and

principal payments, but also gives the bondholder the option to convert the bond into stock.

How does it help companies?

Some companies, banks, governments, and other sovereign entities may decide to issue bonds in

foreign currencies because:

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It may appear to be more stable and predictable than their domestic currency.

It gives issuers the ability to access investment capital available in foreign markets.

Companies can use the process to break into foreign markets.

The bond acts like both a debt and equity instrument. Like bonds it makes regular coupon

and principal payments, but these bonds also give the bondholder the option to convert the

bond into stock.

It is a low cost debt as the interest rates given to FCC Bonds are normally 30-50 percent

lower than the market rate because of its equity component.

Conversion of bonds into stocks takes place at a premium price to market price. Conversion

price is fixed when the bond is issued. So, lower dilution of the company stocks

Pros of FCCB to the Investor Assured returns in the form of fixed coupon rate payments Lower tax liability due to lower coupon rate Ability to take advantage of price appreciation in the stock by means of warrants attached to the

bond. Cons of FCCB Exchange rate risk due to conversion at a future date When converted into equity, FCCB brings down EPS In a falling stock market there is no demand for conversion to equity.

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Savings

Savings are shown for every product that is being used by the competitor by taking the base of

borrowings with both long term and short term.

Average Long term Borrowing is 12652 million

Average Short Tem Borrowing is 8097.4 million

*Savings are shown on assumption basis

*Non-convertible Debentures

TNPL is using at 11%, 8.75%

BILT is using at 9.60%

Taken BILT’s interest is because TNPL being a government owned company, pays less interest.

*Debentures

Alok is using at 12% - 14.50%

BILT is using at 11.75%

J.K. paper is using at 11%, 8.75%

Taken least interest rate that J.K. paper is availing.

*Commercial paper

Welspun is using at credit rating of IND A1+

TNPL is using (Gov. owned co)

Rate is 9% - 9.5%

*Fixed deposits

Vardhman, TNPL, BILT, J.K. paper are using.

Rate is 9% - 12.5%

Product Company Rate of Interest

Trident Term Loan /

Working Capital Loan

*Savings on monthly

basis

Short Term Borrowings

Non-Convertible Debentures*

BILT 9.60%

10.05%

30 lac/m

Commercial Paper* Welspun / TNLP 9 % 70 lac/m

Long Term Borrowings

Debentures* J.K. Paper 8.75%

10.95%

2.3 Crore/m

Fixed Deposits* Vardhman/TNLP/BILT/

J.K. Paper 10% 1 Crore/m

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Additional Products

Some of the new products in the market which Trident can go for:-

1. Capital Indexed Bonds

Capital indexed bonds are inflation protection securities. Such bonds, therefore, provides good

hedge against inflation risk. The benefits do extend beyond hedging. Capital index bond can be

used as a market indicator for inflation expectation. This will help investors take a more intelligent

decision on their current consumption. Finally, the spot yield curve can be better constructed based

on the real yields.

In line with the most popular structure prevalent internationally, the proposed CIB would offer

inflation linked returns on both the coupons and principal repayments at maturity. The basic feature

of bonds would be that the coupon rate for the bonds would be specified in real terms. Such real

coupon rate would be applied to the inflation-adjusted principal to calculate the periodic semi-annual

coupon payments. The principal repayment at maturity would be the inflation-adjusted principal

amount or its original par value, whichever is greater, thus with an in-built insurance that at the time

of redemption the principal value would not fall below par. The inflation protection for the coupons

and the principal repayment on the bond would be provided with respect to the Wholesale Price

Index (WPI) for All Commodities (1993-94=100), the leading measure of inflation in India.

Method of issue

The CIB would be sold through auction under which competitive bidders would be required to bid in

terms of a desired real yield (yield prior to inflation adjustment), expressed as a percentage with

two decimals, e.g., 3.00%. Specific terms and conditions for the auction, including the auction date,

issue date, tenure of the bonds and the notified amount would be announced prior to each auction.

2. Extendable Notes

Extendable notes are issued for 10 years with flexibility to the issuer to review interest rates every

two years. The interest rate is adjusted every two years to reflect then prevailing market conditions

by trying the interest rate to a spread over a bond index such as two years treasury notes. Depending

on the specific terms of the extendable bond, the bond holder and/or issuer may have one or more

opportunities to defer the repayment of the bond’s principal, during which time interest payments

continue to be paid. Additionally bond holder or issuer may have the option to exchange the bond

for one with a longer maturity, at an equal or higher rate.

3. Floating Rate bonds

Floating rate notes (FRNs) are bonds that have a variable coupon, equal to a money

market reference rate, like LIBOR or federal funds rate, plus a quoted spread (a.k.a. quoted

margin). The spread is a rate that remains constant. Almost all FRNs have quarterly coupons, i.e.

they pay out interest every three months. At the beginning of each coupon period, the coupon is

calculated by taking the fixing of the reference rate for that day and adding the spread. A typical

coupon would look like 3 months USD LIBOR +0.20%

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Risk Involved

FRNs carry little interest rate risk. An FRN has a duration close to zero, and its price shows very low

sensitivity to changes in market rates. When market rates rise, the expected coupons of the FRN

increase in line with the increase in forward rates, which means its price remains constant. Thus,

FRNs differ from fixed rate bonds, whose prices decline when market rates rise. As FRNs are almost

immune to interest rate risk, they are considered conservative investments for investors who believe

market rates will increase. The risk that remains is credit risk.

4. Fixed Rate bonds

Fixed rate bond is a type of debt instrument bond with a fixed coupon (interest) rate, as opposed

to a floating rate note. A fixed rate bond is a long term debt paper that carries a predetermined

interest rate. The interest rate is known as coupon rate and interest is payable at specified dates

before bond maturity. Due to the fixed coupon, the market value of a fixed-rate bond is susceptible

to fluctuations in interest rates, and therefore has a significant amount of interest rate risk. That

being said, the fixed-rate bond, although a conservative investment, is highly susceptible to a loss

in value due to inflation. The fixed-rate bond’s long maturity schedule and predetermined coupon

rate offers an investor a solidified return, while leaving the individual exposed to a rise in the

consumer price index and overall decrease in their purchasing power.

The coupon rate attached to the fixed-rate bond is payable at specified dates before the bond

reaches maturity; the coupon rate and the fixed-payments are delivered periodically to the investor

at a percentage rate of the bond’s face value. Due to a fixed-rate bond’s lengthy maturity date, these

payments are typically small and as stated before are not tied into interest rates.

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Conclusion

The project has been able to cover many of the key focus areas of business finance and competitor

analysis on general.

Through the first part of the project - Competitor analysis with information on the operational

analysis and comparison of the major competitors. Trident Limited is now into its expansion stage

and such information helps in making important strategic decisions while moving forward towards

the path of success and growth.

The company has tremendous scope of cost savings. Which was highlighted through the project

savings. With application of the practically possible recommendations, there is an opportunity to

save as much as Rs Crore, in term Loans and working capital alone.

All effort has been made to make this report as user friendly as possible. It has been stressed

throughout the project that the focus has been on highlighting implementable changes rather than

establishing theoretical excellence.

This piece of document was aimed at being a small contributor to the bigger success story of Trident

Group.

By Surbhi Jindal

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