KKCL -- KILLLER JEANS
Printed From: The Equity Desk
Category: Investment Ideas - Creating winning portfolios!
Forum Name: Stock Synopsis
Forum Discription: A bried discussion of companies on very specific matters. Normally this is the prelude for further research as always members would be discussing quality companies with good management only
URL: http://www.theequitydesk.com/forum/forum_posts.asp?TID=2650
Printed Date: 04/Apr/2025 at 2:55am
Topic: KKCL -- KILLLER JEANS
Posted By: hit2710
Subject: KKCL -- KILLLER JEANS
Date Posted: 02/Feb/2010 at 6:49pm
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KEWAL KIRAN CLOTHING LIMITED. KKCL IS AN INTEGRATED APPAREL MANUFACTURER INVOLVED FROM MANUFACTURING TO RETAILING. THE COMPANY HAS FOUR ESTABLISHED BRANDS IN THE RETAIL APPAREL WEAR KILLER, INTEGRITI,EASIES AND LAWMAN KILLER AS A BRAND HAS COMPLETED 20 YEARS AND HAS GAINED ACCEPTABILITY AS A GOOD RELIABLE JEANS BRAND. THE COMPANY IS SLOWLY EXTENDING THE BUSINESS TO LADIESWEAR UNDER THE KILLER BRAND. THE COMPANY AT THE END OF FY 09 HAD 123 OPERATIONAL RETAIL STORES. BUSINESS MODEL KKCL OPERATES THE RETAIL STORES IN THREE FORMATS, COMPANY OWNED COMPANY OPERATED, COMPANY LEASED AND FRANCHISEE OPERATED AND FRANCHISEE LEASED AND FRANCHISEE OPERATED. ONLY FIVE STORES FALL IN THE FIRST CATEGORY. THE COMPANY SELLS ITS PRODUCTS TO THE DISTRIBUTORS/RETAILERS ON OUTRIGHT SELL BASIS WITHOUT TAKING THE RISK OF INVENTORY BUILD UP. IT PROVIDES 33-45% MARKED DOWN PRICES TO ITS TAG PRICE AND THUS TRANSFERS THE INVENTORY RISK TO THE SELLER/RETAILER. FINANCIALS EQUITY--- 12.33 CRORES FACE VALUE OF RS 10. DEBT AS ON MARCH 09 WAS 23 CRORES WITH TOTAL CURRENT MARKET CAP AT 295 CRORES
Ronw figures are taken from bse website.(don’t know how reliable it is) 9 month eps is around 19.5 (not annualised) Positives: 1. The business model of the company does not entail inventory risk unlike other retailers 2. Low debt of 23 crores. Company had cash of around 65 crore as on March 09 due to funds raised during ipo in 2006. 3. Management seems to be very conservative in its expansion plans and have expanded their retail operations without loading up too much debt 4. Full integration with almost 90% production from its own facilities provides better quality control along with cost advantage. 5. High promoter holding of around 74-75% RISKS: Dependence on single brand Killer which contributes around 53% of its total revenues Slow and conservative expansion can also dampen the growth of the company(although in hindsight it seems to have been beneficial) TECHNICALS: THE STOCK MADE A HIGH OF 564 IN JAN 08 AND THEN FELL DOWN TO FORM A LOW OF 86 DURING MARCH 09 AND SINCE THEN HAD BEEN IN AN UPTREND FORMING A SORT OF UPWARD SLOPING CHANNEL. RECENTLY THE STOCK BROKE DOWN FROM THE CHANNEL AND IS CORRECTING. ITS 200 DEMA AROUND 205 COULD BE NEXT SUPPORT. CURRENT MARKET PRICE IS AROUND 240. THIS IS A SYNOPSIS(not a buy recommendation) FOR VIEWS FROM OTHER MEMBERS WHO HAVE MORE INSIGHT INTO RETAIL PLAYS TO POINT OUT THE RISKS AND BENEFITS AND THINGS TO LOOK OUT FOR WHILE INVESTING IN RETAIL PLAYS. THIS IS A COMPANY WITH LOW DEBT AVAILABLE AT AROUND 10 PE AND NOT TOO MUCH RESEARCHED. ------------- Stockmarket is a weird place. For every person who buys a stock there is a person who sells it and both think they are very smart. |
Replies:
Posted By: nav_1996
Date Posted: 02/Feb/2010 at 7:55pm
| Challenge is that its biggest brand Killer is not an aspirational brand in denims among youth. |
Posted By: hit2710
Date Posted: 02/Feb/2010 at 9:02pm
Very true nav. But I feel, among listed retail players like koutons, raymonds or some others this one seems better placed financially and from personal experience I can say that during my college days we used to prefer killer bcos the most preferred brand was levi and others but they did not fit our pockets then whereas killer was a good compromise between price and quality. ------------- Stockmarket is a weird place. For every person who buys a stock there is a person who sells it and both think they are very smart. |
Posted By: EMANI
Date Posted: 02/Feb/2010 at 10:40pm
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Hiteshji, I am providing data relating to KOUTONS for a quick comparision. EQ.......30CR M CAP....1217CR Face value......10 PE.................14 SALES.....1046(Mar09-12months) 818(9 months current year) NP.....79.......(MAR09).....................50(9 months) Debt eq...1.36 Book value...154 Roce...23.16 Ronw...20.70. It is currently operating 1400stores and another100 tobe added during the current year. Moreover, most of them are franchisees. I request you to compare the above and bring out the pros and cons. ------------- esn |
Posted By: NeerajMarathe
Date Posted: 02/Feb/2010 at 12:00pm
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Just some dope:
- their business model is a lot different from others. what they do is SELL the entire inventory to the franchisee (shop owner). this reduces a lot of working capital, explaining the better balance sheet. - secondly, wenevr there r a lot of stores added (not their own), u will see a jump in sales. this is coz the franchisee has to set up shop with about Rs.20 lakh worth of clothes..(i talked wid the shop owner near my place) whether the shop manages to sell the clothes to customer or not, KKCL books the sales. (nothn rong in it..quite a good policy) - the operating profit margins have increased quite a lot recently. imho, these r not sustainable. - the points raised by other members about the brand power are also very valid, i think. (i do not think it is cheap enuf at this mkt cap) ------------- Regards Neeraj Marathe |
Posted By: nav_1996
Date Posted: 02/Feb/2010 at 11:24am
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There is no magic in biz model. Only very strong brands will survive. Or you have to be a multi brand retailer like Pantaloon/Shopper Stop. Short-term we can make some money but I don't see a moat in longer term.
Aspirational values have changed a lot. We had to contend with Killer becoz limited pocket money. But ask your college going cousins now-a-days  . They manage somehow. I guess a pair of good branded denim used to cost 500 15 years back can be still bought for 1000. So aspirational brands have become much affordable today.
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Posted By: hit2710
Date Posted: 03/Feb/2010 at 12:31pm
Thanks nav for your views. I agree there does not seem any moat in kkcl. I intend to keep watching for another 1-2 quarters before taking a call. ------------- Stockmarket is a weird place. For every person who buys a stock there is a person who sells it and both think they are very smart. |
Posted By: Vrishali
Date Posted: 03/Feb/2010 at 7:55pm
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http://www.nalandacapital.com/category/portfolio/ - who invested in Page Industries is also invested in this one [ http://www.kewalkiran.com/shareholding-pattern.html - 9.74% stake ] ------------- "Diversification is a protection against ignorance. It makes little sense for those who know what they're doing." - Warren Buffet |
Posted By: BGKGURU
Date Posted: 03/Feb/2010 at 8:41pm
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Sometime quality is more important than quantity. kkcl prodct is very well accepted by market they are very conservative so grwing slowly. You can compare kouton with kkcl by mkt cap,sales etc.
I just request you plz give me one known brand name. I leave at jabalpur. kkcl franchisee is doing well and profitabla.
I can asssure that it is not going to close atleast next 25 years. i can promise for after 25 years because i can't see that far.
But kouton franchisee can be close anytime in next two years.
So I ike kkcl because of brand visibilty. I like skumar and brandhouse also but i prefer kkcl because of more visibilty.
skumar and brandhouse is cheapest but they take higher risk so i will wair for next two years to take higher exposure.
I hold all 3 scrips ------------- Respect the Markets and do MAKE mistakes, but see to it that you can afford to stay in the markets even after the mistake-RJ |
Posted By: BGKGURU
Date Posted: 03/Feb/2010 at 8:42pm
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Basantji
I think you are following page ind. can u give me mext 3 years assumption . ------------- Respect the Markets and do MAKE mistakes, but see to it that you can afford to stay in the markets even after the mistake-RJ |
Posted By: hit2710
Date Posted: 03/Feb/2010 at 9:41pm
Ashish Dhawan of ??chrysalis capital also has personal holding of 1.26% It seems he acquired it in sep-dec09 quarter bcos earlier holding does not show him holding any shares. I think he was mentioned earlier in the greenply thread as a shareholder. ------------- Stockmarket is a weird place. For every person who buys a stock there is a person who sells it and both think they are very smart. |
Posted By: hit2710
Date Posted: 03/Feb/2010 at 9:45pm
Ashish Dhawan of ??chrysalis capital also has personal holding of 1.26% It seems he acquired it in sep-dec09 quarter bcos earlier holding does not show him holding any shares. I think he was mentioned earlier in the greenply thread as a shareholder.[/QUOTE] ------------- Stockmarket is a weird place. For every person who buys a stock there is a person who sells it and both think they are very smart. |
Posted By: commnman
Date Posted: 29/Jan/2011 at 5:58pm
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A fashionable growth !
Q3 numbers out... Total Income up 63% to 63.34 Cr from 38.9 Cr. EBIDTA up 87% to 17.17 Cr from 9.18 Cr. Net Profit up 77.2% to 11.27 Cr from 6.36 Cr. EBIDTA margin is 27.11% V/s 23.6% (DQ-09) and 30.62% (SQ-10) NET Pr margin is 17.8% V/s 16.35% (DQ-09) and 20.63% (SQ-10) Total raw material costs as a %ge to Income is 37.87% V/s 36.56% (DQ-09) and 37.74% (SQ-10) Other Expenses as a %ge to Income is 25.54% V/s 27.17% (DQ-09) and 21.88% (SQ-10) Tax rate increased to 32.92% from 31.98% Y-t-D 9-month 2010 to 9-month 2009: Total Income up 40% to 181.53 Cr from 129.65 Cr (FY10 Full year 176.05 Cr) EBIDTA up 55.7% to 52.56 Cr from 33.75 Cr (FY10 Full year 46.66 Cr) Net up 45.8% to 35.15 Cr from 24.11 Cr (FY10 Full year 32.51 Cr) Reported Nine month EPS is 28.51 V/s 19.56 (FY10 Full year 26.38) ------------- main toh aam aadmi hun... jo sunta hoon wohi sach maanta hoon |
Posted By: Ravenrage
Date Posted: 29/Jan/2011 at 7:06pm
 I used to think I am the only one who is bullish on this one . Good to see a thread on this !
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Posted By: subu76
Date Posted: 29/Jan/2011 at 11:18pm
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Frankly the numbers is a bit surprising since Killer Jeans as a brand just does not seem to be a killer one. I regularly visit a mall near my house and find the Killer Jeans store to be completly empty except for the bored individuals behind the counter.
Do you guys (who're bullish on this one) have a different experience?
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Posted By: commnman
Date Posted: 29/Jan/2011 at 12:28pm
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I used to be bullish on this one, especially after going through their AR.
Having so impressed, I wanted to buy a pair of jeans. And I couldn't find it anywhere here in bangy. Having been in the business for so long and you don't have a store in this hip and happening place like Begalooru... I got somewhat disappointed and completely came out of it. ------------- main toh aam aadmi hun... jo sunta hoon wohi sach maanta hoon |
Posted By: studentoflife
Date Posted: 29/Jan/2011 at 4:43am
I have recently bought the stocks of this company. These guys have a franchisee business. So if a single outlet doesnt work ,it is not a problem. The fact that their topline and bottom line is increasing annually is enough. Moreover Killer is certainly an alternative to Levi's in case you have tight budget.During my college days in Mumbai ,Killer was a sought after brand. ------------- First step towards learning is the realization that you do not know anything. |
Posted By: Ravenrage
Date Posted: 29/Jan/2011 at 9:46am
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Its not only Killer .
Killer is a denim wear . There are other brands too such as Lawman ,Integriti and Easies . Coming to Killer , Killer was created in 1989 !! So its sort of bigger than me ! Killer is the first international denim brand to be created in India. Killer accounts for more than 50 % of the sales , followed by Integriti , Lawman and Easies . Recently they have also launched Lawman Pg3 and if the management is to be believed , then the product is doing good . Product wise , jeans accounts for > 50 % of the sales . KKCL has 141 retail stores (FY10)and they plan to add 50 more . They have done a capacity expansion by commissioning a factory at Vapi and they have done more capex in this financial year . Region wise , Northern region contributes the lowest while the West contributes the maximum. Eastern region has gradually gaining market share and is doing well . Their distributors/MBOs account for > 58 % of their sales , retail chains ( 28 %) , followed by national chain stores , factory outlets and exports . Also , KKCL is a cash rich co. and you get 100 rupees / share from the investments in fixed deposits and mutual funds. At lower levels , it could be a good buy . |
Posted By: subu76
Date Posted: 30/Jan/2011 at 12:44pm
Have you personally bought any of these brands lately or found them selling to your friends/relatives?
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Posted By: Ravenrage
Date Posted: 30/Jan/2011 at 1:07pm
Not really , I generally go and buy garments from a local shop . They are way cheaper and I have no complaints . |
Posted By: subu76
Date Posted: 30/Jan/2011 at 1:11pm
Do let me know if you have any personal touch point with this company....while i'm interested in the stock i was never excited by the real business side of the company.......it would be great to know about other perspectives
To give you some idea...as you know some of the winners in stock market like Titan, Page, Hawkins, TTK have also caused great delight to us when we visited their store or bought their product
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Posted By: vaib
Date Posted: 30/Jan/2011 at 11:55pm
| Killer is present in many many shopping malls. It was a surprise for me. It does create brand awareness and value. And one can see that in their numbers. Besides that I liked their ad a lot. To me it is looking like a fine deal, awakening from dead. When I was in college I bought a chino paints of killer which I admired a lot and was my most favourite. From that time it just lot pace in the flood of the other brands. It may not be a distinguished one now a days like levi or lee but doing ok. Going ahead I will be keeping an eye on its numbers. |
Posted By: BGKGURU
Date Posted: 30/Jan/2011 at 11:26am
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I know one shop in jabalpur doing very well. well known name in jabalpur. ------------- Respect the Markets and do MAKE mistakes, but see to it that you can afford to stay in the markets even after the mistake-RJ |
Posted By: nikhil090
Date Posted: 09/Apr/2011 at 8:12pm
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Quarterly review from the mgmt http://www.kewalkiran.com/images/Analyt%20Presentation%20Q3%20FY%202011.pdf - http://www.kewalkiran.com/images/Analyt%20Presentation%20Q3%20FY%202011.pdf
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Posted By: Ravenrage
Date Posted: 09/Apr/2011 at 9:02pm
| Things are looking UP ! |
Posted By: FutureBull
Date Posted: 09/Apr/2011 at 10:28am
How do u say that? Anything worthwhile to share? I am watching it too..stock Bounced back very smartly
------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: rinkumalpani
Date Posted: 10/Apr/2011 at 2:46pm
| what bout competitors..is levis listed?? |
Posted By: Ravenrage
Date Posted: 26/May/2011 at 7:09pm
| Good results ! |
Posted By: FutureBull
Date Posted: 26/May/2011 at 9:34pm
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true, results have been good almost 42% growth in full yr eps. still unable to make up my mind. Ravenrage, are you invested here? ------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: Ravenrage
Date Posted: 26/May/2011 at 9:45pm
| Yes !! |
Posted By: Ravenrage
Date Posted: 30/May/2011 at 9:34pm
| I just went through a Sharekhan report with a target of 674 !! ROE is at an impressive 24.4% and its likely to continue its upward bias . |
Posted By: FutureBull
Date Posted: 30/May/2011 at 12:27pm
Raven, I noticed a funny thing.. on one hand this report says that KKCL is an emerging star but on front page it mentions it as "Ugly Duckling" . Do they have editing team in place?------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: Ravenrage
Date Posted: 30/May/2011 at 7:36am
| LOL , doesn't matter much ! But Sharekhan has been spot on with some numbers . |
Posted By: EquityInv
Date Posted: 04/Jun/2011 at 2:00am
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“Fashion” with "Quality" is the cornerstone of each collection introduced by the company. The company’s strong fashion forecasting and trendsetting abilities have created brands which are vibrant, trendy and with an attitude. Each brand has been carefully crafted keeping in mind desires and attitudes of specific market segments. Each brand is an expression of its customer. The trendiest collections are backed by a strong retail and distribution network. The company’s extensive reach has been built in a strategic and planned manner over the years. Killer, Easies, Lawman, Integriti – leading brands in men’s wear in India. The Company behind them all - Kewal Kiran Clothing Limited. Currently, these brands have an exciting range of western wear for women Incorporated in 1981, Kewal Kiran Clothing Limited today is amongst the few large branded apparel manufacturers in India. The company has sales in Asia, Middle East and CIS. The company designs, manufactures and markets branded jeans, Semi-formal and casual wear for men and women. 50% of revenue is contributed by KILLER while 25% by Integrity, 20% Lawman and 5% others. Integrity was launched in 2002 and since then got good acknowledgement from customers which reflects in it's growth. They are increasing franchisee retail stores across pan India and have around 175 stores. ADDICTION is another lifestyle retailing store launched recently to extend existing brands to range of accessories. http://kkcladdictions.com/addictions/index.php KKCL has 108 K-Lounge, 28 exclusive KILLER stores, 22 INTEGRITY, 4 LAWMAN, 7 FACTORY outlet and 4 ADDICTION retail stores/EBOs. With huge business scalability and best management in place, this company is all set to become very big branded retailer. Most imporantly, management shown great ability to grow business with very less capital. Hence it's asset light business and in same context it can be directly compared to any good FMCG. Only few out of many retailser succeed and KKCL has many ingredients to make it HUGE successful. Hence we have to be very careful while investing in any retailers. Some of them with bad management fails and business detiorates like Koutons or Cantabil Retail.. Unlike other retailer, KKCL is outstanding in managing excellent inventory and debtors. It's debt free and cash rich company with cash and equivalent of 120+ crores. Again very hard to find this quality in their competitors. Great return ratios of RoCE of 79% and improving RoE of 60% [after excluding idle cash on books]. Doubt if any of competitors can even come close to this ratio. Excellent balance sheet with consistent improvement in Free Cash Flow. Again, no competitor can beat it. I can't think of anything that can go wrong with this business and don't see any reason why it should discount only 11 times FY12 earnings while other similar business demands 25-30 times valuation. Company should sustain growth at 25-30% CAGR for next few years. Appreciate comments from everybody. I wonder why this one didnt fancy TEDs so far as it fits the bill of domestic consumption theme also
DISCLOSURES – I hold KKCL. ------------- One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do – James Rogers |
Posted By: studentoflife
Date Posted: 04/Jun/2011 at 9:49am
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I have this stock.My only concern is volume growth in sales. If we can find the historical volume growth in sales ,then we can know whether there is growing demand for KKCL products.
------------- First step towards learning is the realization that you do not know anything. |
Posted By: nikhilmoryani
Date Posted: 05/Jun/2011 at 1:37am
| Isn't a lot of competition in branded wear a significant threat to this company? Plus,how well is Killer as a brand compared to other denim brands? Or for that matter,other brands owned by KKCL? |
Posted By: EquityInv
Date Posted: 05/Jun/2011 at 3:34am
Their volume growth is 17% CAGR since last 4 years and it should increase going ahead. Most important part is they don't let margins impact at the cost of increasing volumes. ------------- One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do – James Rogers |
Posted By: EquityInv
Date Posted: 05/Jun/2011 at 3:50am
There's huge market for branded garments for everybody to grow in India so there's no actual threat. Their growth and margins reflects that all brands of company are growing at good rate. Main question will be will they get little aggressive and use brand power and financial muscle [120+ crores] to grow 40-50% or not. ------------- One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do – James Rogers |
Posted By: Ravenrage
Date Posted: 05/Jun/2011 at 4:14am
| No one's talking about the free cash one gets / share . |
Posted By: EquityInv
Date Posted: 05/Jun/2011 at 4:32am
Market don't value cash on books. While it's good on books but they should use it in the business to earn better returns.. One more thing, it's dragging down return ratios too. ------------- One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do – James Rogers |
Posted By: Ravenrage
Date Posted: 05/Jun/2011 at 7:47am
Yes , I know that . We don't want an US situation here where companies are sitting on the highest levels of cash and no growth . Any chance of shareholders being rewarded ? |
Posted By: nikhil090
Date Posted: 18/Jun/2011 at 12:50pm
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Q4 result presentation http://www.kewalkiran.com/images/Analsyt%20Ppt%20Q4%20%20FY2011.pdf |
Posted By: FutureBull
Date Posted: 18/Jun/2011 at 1:43am
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this is a company to watch out., PAT margin of 20% though not sustainable in long term, but very tempting indeed. ------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: funkyappu
Date Posted: 18/Jun/2011 at 2:20am
How's it not sustainable? Kindly throw light on it.. ------------- |
Posted By: FutureBull
Date Posted: 18/Jun/2011 at 11:58am
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Well, my assumption is that competition will only grow from here and long run means 5+ yrs. Branded retail is still not mature enough. once we have FDI allowed, competition will very high to drive the margin down. If you look at the presentation it says they increased realisation by 12%. Now you can not expect this growth to happen for ever. At a later stage it will have to go for volume.
when I look at Nike which is global powerhouse and one of the best brand has PAT margin of only 10%. It will have high PAT margin for 4-5 yrs but not after that. It has taken franchise route which is great from ROE,ROCE perspective and that will remain good for much longer period. Once they are well entrenched in the game they will have to increase sales and asset turnover by keeping margin on lower side (lower from here). Disclosure: I'm not invested yet. But might decide in a week or two. ------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: Ravenrage
Date Posted: 27/Jun/2011 at 8:30pm
| This bloke has surpassed the most optimistic estimates . |
Posted By: nikhil090
Date Posted: 27/Jun/2011 at 8:52pm
| there should be more on the way !!!!!!!! |
Posted By: Ravenrage
Date Posted: 27/Jun/2011 at 8:57pm
| Definitely !! |
Posted By: EquityInv
Date Posted: 27/Jun/2011 at 8:57am
Wait for few days, they'll come out with new estimates - 20% upside
------------- One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do – James Rogers |
Posted By: FutureBull
Date Posted: 27/Jun/2011 at 10:06am
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this is rising on very thin delivery volumes (from 70% to 12%)..somebody plans to distribute at higher levels. But yes it surpassed even most optimistic estimates.. now at almost PE 20 on TTM basis. ------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: Ravenrage
Date Posted: 27/Jun/2011 at 10:09am
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700 crossed
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Posted By: nikhilmoryani
Date Posted: 27/Jun/2011 at 11:57am
| I was fascinated to see an opportunity in KKCL a few weeks ago as I chanced upon this thread. I did a cursory check on this company and found it to be a bit interesting but I was concerned about the acceptance of brands owned by KKCL as there are,no doubt,better brands and people usually want to go for the best. Barring the price points of the brands,I couldn't see any other reasons why people would choose Killer/Lawman/Easies/Integriti over other well-known brands. I was skeptical that KKCL won't do great as there is immense competition and did not look further into the company. Could anyone justify the rise in the stock price and make me understand the future potential? |
Posted By: Circuit
Date Posted: 28/Jun/2011 at 5:57pm
If one compares last one year or two year performance,
------------- Fundamentalists and anticipators may have difficulties with risk control because a trade keeps looking ‘better’ the more it goes against them....Ed Seykota |
Posted By: EquityInv
Date Posted: 28/Jun/2011 at 10:44pm
I think Killer have good brand recall while integrity is getting stronger rapidly. How about to do some more scuttlebutt and ask few of friends who used any of their brands and get their comments? "Killer Nari" can server well to "top" of pyramid. ------------- One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do – James Rogers |
Posted By: valuebuyer
Date Posted: 02/Jul/2011 at 1:22am
| Prices are being taken up even with low volumes. The same old story. |
Posted By: commnman
Date Posted: 28/Jul/2011 at 7:05pm
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Q1/Fy-12 results out...
Total Income up 52.7% to 69.33 Cr from 45.41 Cr. EBIDTA up 33.4% to 17.29 Cr from 12.96 Cr. Net Profit up 42.6% to 12.62 Cr from 8.85 Cr. EBIDTA margin is 24.9% V/s 28.5% (JQ-10) and 29.2% (MQ-11) NET Pr margin is 18.2% V/s 19.5% (JQ-10) and 20.2% (MQ-11) Raw material costs as a %ge to Income is 39.6% V/s 37.5% (JQ-10) and 38.8% (MQ-11) Employee costs stable. Other Manufacturing, admin, and s&D expenses to sales ratio is 24.7% V/s 20.5% (JQ-10) and 20.7% (MQ-11) Tax Rate is 31.5% V/s 33.3% (JQ-10) and 33.5% (MQ-11) - ------------- main toh aam aadmi hun... jo sunta hoon wohi sach maanta hoon |
Posted By: nikhil090
Date Posted: 03/Aug/2011 at 8:42pm
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Quarterly performance update http://www.kewalkiran.com/images/Analyt%20Presentation%20Q1%20FY%202012.pdf |
Posted By: Ravenrage
Date Posted: 07/Aug/2011 at 8:45pm
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Integriti is selling like hot cake in my city . One of the biggest retail shop owner believes it is one of the best brands he has sold. No complaints about quality , long lasting , according to him its got all the qualities to become an "International" brand . ------------- Risk does not reside in price changes, but in miscalculations of intrinsic value . |
Posted By: kailasp4u
Date Posted: 08/Aug/2011 at 9:44pm
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One more HIT stock! Good work, but I have (just on time) escaped finger-burns in Koutons, so little cautious. ------------- knp |
Posted By: xpresso
Date Posted: 08/Aug/2011 at 9:51pm
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The only challenge has to buy decent quantities without jacking up the price with so few sellers. I dread the same fate when the time to sell comes. As of now things look quite rosy.
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Posted By: Ravenrage
Date Posted: 17/Aug/2011 at 9:47pm
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Have been watching an ad of killer deo for the last few days . Are they venturing into deodorants ? ------------- Risk does not reside in price changes, but in miscalculations of intrinsic value . |
Posted By: FutureBull
Date Posted: 17/Aug/2011 at 9:58pm
Ravenrage, you are very correct they are extending accessories line of all the brands. I learnt that they are particularly bullish on Addiction brand. I have taken initial exposure in this. I somehow believe that this is another Page in the making. I am entitled to be a mungeri  . Just look at the expanding margins, quality of reporting and clarity of thought and vision. I would just have wished a better qualified board though.Just that this is still a small organisation and way to go. Needless to say opportunity is huge. ------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: studentoflife
Date Posted: 27/Aug/2011 at 4:56pm
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The annual report must have been really expensive to print.Also the content is too sexualized. Seems there is no other way to sell for the 15 to 30 age group. But atleast this is better than Temptations annual report..that one was almost pornographic.. ------------- First step towards learning is the realization that you do not know anything. |
Posted By: Ravenrage
Date Posted: 27/Aug/2011 at 6:39pm
May I ask the average entry price ? ------------- Risk does not reside in price changes, but in miscalculations of intrinsic value . |
Posted By: FutureBull
Date Posted: 27/Aug/2011 at 6:51pm
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my average stands at 725. I was tracking it from 550 levels...took some time to understand it better and it zoomed up. ------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: Ravenrage
Date Posted: 27/Aug/2011 at 7:02pm
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Your buying price gives me comfort ------------- Risk does not reside in price changes, but in miscalculations of intrinsic value . |
Posted By: FutureBull
Date Posted: 27/Aug/2011 at 7:09pm
oh! what is yours? free float is around 10% so liquidity will be an issue till someone holding large quantity gives up. Every 5-10% down, Page and KKCL would be my top buy. I had started with SIP and just could not buy enough at right price
------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: om2112
Date Posted: 27/Aug/2011 at 8:37pm
Management clearly stated that on it's goal to reach 1000 cr sales by 2015-16 ADDICTIONS brand will play key role.The company markets around 50 products in this line which include wrist bands, shoes, watches and glares, to name a few. In FY11 - the first year of launch - the company recorded sales of ~Rs 52 mn, 2.2% of overall revenues. It has already crossed the same amount of sales in the first two months of FY12.It's high margin product segment. |
Posted By: FutureBull
Date Posted: 27/Aug/2011 at 8:57pm
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I am just unable to estimate what could be margin by 2015-16. I thought they would have reduced margin in denim and other traditional segments due to competition and expansion into hinterland. But if they keep launching brand like "addiction", they could maintain PAT margin of 20%. This gives us 30% CAGR in net profit and 30%+ for stock assuming 20 PE(trailing stands at 17 I guess). ------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: om2112
Date Posted: 27/Aug/2011 at 9:59pm
It's very difficult for me too to estimate the margins over such a long period. It depends on aggressiveness of management in launching and pushing brands,advertisement expenses etc.Over the past four years, the company’s adv expenses have been around 7% of sales.These sustained investment in brand building has given the company intangible benefits over new entrants.A well-thought-out brand strategy, sustained investments in marketing, diversified brand positioning and launch of innovative designs are the key reasons for Kewal Kiran’s success and very high OPM's. It's trading at 15 PE on projected EPS of 50 FY 2012.(CRISIL ESTD EPS 48). A company growing at 30 per CAGR it's trading at cheap valuations.If we subtract per share Rs 100 cash it's compelling.With robust cash flows company distributed almost 50 per earnings as dividends(RS 16.5).With multiple brands serving different segments i think this business is de-risked business model. DISC: I am invested and still adding. |
Posted By: Ravenrage
Date Posted: 27/Aug/2011 at 10:07pm
I bought it in 3 trenches , 240 , 220 , 370 the average price should be max. 300 (all figures rounded) . I will like to add that initial purchases were based completely on HDFC Sec recommendations . My first 2 trenches have enjoyed 4 dividends , which accounts for almost 10% of capital invested . I am eagerly waiting for a dip , but i guess its tough for a price of my liking to come . The right price is never too right . ------------- Risk does not reside in price changes, but in miscalculations of intrinsic value . |
Posted By: FutureBull
Date Posted: 27/Aug/2011 at 10:34pm
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Wow Ravenrage , good entry indeed. The dividend too attracted me here.
Omji, total cash on the balance sheet would be around 100cr post Q2 (not per share). was 91cr by Q1. ------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: om2112
Date Posted: 27/Aug/2011 at 8:38am
Total cash on balance sheet after Q1 is 128 cr.Here you have to include cash and bank balance +investments.For this please refer to Q1 analyst presentation posted on their website.Another important note is Next in line from the Lawman Pg3 stable is yet another innovative product called ‘Emboss’ which is ready to take on the markets. |
Posted By: rkgautam
Date Posted: 27/Aug/2011 at 10:27am
| any idea how much they are paying Kangana Ranaut for being a brand ambassador? |
Posted By: FutureBull
Date Posted: 28/Aug/2011 at 1:29pm
Thanks Omji for correcting me!! If we take cash out we have almost 720cr mcap growing at 30%+ and with current year earnings of 60cr+
------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: rkgautam
Date Posted: 29/Aug/2011 at 6:17pm
any info about this?
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Posted By: FutureBull
Date Posted: 29/Aug/2011 at 10:20pm
How does it matter? if the overall ad budget is consistent with corp. strategy, why should we bother?
------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: rkgautam
Date Posted: 29/Aug/2011 at 10:26pm
would you have said the same thing if they had hired Gisele Bündchen?
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Posted By: kushal.masand
Date Posted: 29/Aug/2011 at 10:38pm
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just wikiED her.... luks nice....  ------------- Lets roll up our sleeves, and get to the work... |
Posted By: FutureBull
Date Posted: 29/Aug/2011 at 10:39pm
so you want to judge the hiring of Kangana based on fee paid? btw my knowledge in fashion biz/trends is very limited
------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: rkgautam
Date Posted: 29/Aug/2011 at 10:44pm
If they are paying 5-10 crores to her, then of course it bothers me. On FY11 PAT of 46 crores, 5-10 crores for one celebrity is too much. That's why I am curious to know the figures.
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Posted By: rkgautam
Date Posted: 29/Aug/2011 at 10:45pm
 looks hi nahi, books (money) bhi hain madam ke paas
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Posted By: kailasp4u
Date Posted: 29/Aug/2011 at 10:51pm
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but 5cr as percentage of sales wont be too much, see it as a part of their marketing expenses! ------------- knp |
Posted By: rkgautam
Date Posted: 29/Aug/2011 at 11:03pm
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I don't know if the number is 5cr or 10cr or more or less. But sure it does tell me something about the company.
Brand ambassadors can make or break a brand, in the long run. While I think Kangana is a great fit, I just want to make sure they're not paying her too much
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Posted By: kailasp4u
Date Posted: 29/Aug/2011 at 11:08pm
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For 256cr sales, selling&admin expenses are 34cr. Out of that endorsement deal for Kangana could be easily 4-5cr. Last 5yr selling expenses have been in similar range. With increasing sales, they can afford to pay more also in future. ------------- knp |
Posted By: rkgautam
Date Posted: 29/Aug/2011 at 11:16pm
| i agree. working on some numbers. will post notes later. |
Posted By: om2112
Date Posted: 29/Aug/2011 at 11:25pm
Can you tell me the exact amount paid to their brand ambassadors by any company. Generally companies don't disclose such amounts.It will be shown in adv expenditure.Kewal maintains approx 7 per of adv exp in total sales.So if you take Fy 11 sales of 236 cr it will be in range of 16-17 cr.Note that this is spent on Adv in all media,Sponsorship to PUNE warriors and others inc payments to KANGANA. |
Posted By: om2112
Date Posted: 29/Aug/2011 at 11:33pm
| Exact figures allocated for adv & publicity - 11.18 cr. ( As per AR 2011) |
Posted By: rkgautam
Date Posted: 29/Aug/2011 at 11:35pm
You are right. The numbers are almost closely guarded, but one can leverage relationships in the industry to get a close estimate. My understanding is about 3-5cr., but I could be way off the actual numbers. |
Posted By: rkgautam
Date Posted: 29/Aug/2011 at 1:15am
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Did a quick value driver analysis using the numbers from FY07 to FY11. Findings:
1. Increase in sales was the biggest value driver for the company. Interest expense lowered a bit, but their contribution was almost negligible. 2. Increase in raw material expense was the biggest factor leading to erosion in value. However, on margin basis, raw material expense as % of revenue decreased from FY07 to FY11 by about 9% (absolute terms), which is a very good sign. 3. Tax expense and Employee expense were the next two large factors leading to erosion in value. However, on margin basis, they remained the same (employee expense as % of revenue and tax expense as % of pbt) I don't have the profile for the number of stores with time and average area per store with time. If I have that, I would be able to make more sense about the data. Basically, I would like to find out average revenue per store and average sales per sq ft per day (is it in 20s or 30-40?) Mr. Kewalchand Jain has indicated that they could do about 1000 cr. revenues by FY2016. I think as it has happened in the past, it will be the case in the future as well...increase in sales is going to be the biggest value driver for them in the time to come. That will be driven by increase in the number of stores and increase in sales from the existing stores. History suggests that not many companies but CCD, Bata have been able to run 500-1000 stores in the country profitably over a long period of time. So, if sales profile doesn't flow well enough against the cost profile of the stores (including new stores), the company could be in a big problem. If they grow the topline at 25% CAGR from here for 5 years, they will do about 725 cr. revenue in FY16, which at 12-15% PAT margin would mean 85-110 cr. profits. Excluding P/E expansion, PAT profile itself would be 13-18% CAGR, which is not bad. The question is whether this company can grow its topline at 25% CAGR or above, with a PAT margin of 10-15%? (20% on a consistent basis for large companies is totally unheard of, and well, entrepreneurs will be more than happy if they can do a PAT margin of 10-12% on a consistent basis). |
Posted By: Ravenrage
Date Posted: 06/Sep/2011 at 10:01am
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This one keeps moving up steadily and silently . ------------- Risk does not reside in price changes, but in miscalculations of intrinsic value . |
Posted By: Shadofax
Date Posted: 06/Sep/2011 at 11:21am
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AGM was on 6th September Someone might have like the company more ------------- $ |
Posted By: abadhya
Date Posted: 19/Sep/2011 at 3:18pm
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This Company is making NEW LIFE TIME HIGH each other day..And there seems lots of activity in Apparel sectors...One news is:
PE players like L Capital Asia, Franklin Templeton PE and Future Ventures to invest in luxury apparel segment - The Economic Times - http://goo.gl/of7Z8 ------------- Rahul. Need of the Hour: Humanaire |
Posted By: Dan_man
Date Posted: 19/Sep/2011 at 4:57pm
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IMHO the key to growing their topline is sizing up their competition and nothing really springs to mind other than the international brands like levis/wrangler..who have been around for years.
Can the tedies think of any indian names that wll give them a run for their money?
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Posted By: rohans
Date Posted: 19/Sep/2011 at 5:09pm
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Basantji - Can this be a good compounding machine ? Seems to have all the ingredients in making e.g.Domestic consumption story with decent brands, debt free balance sheet, generating good free cash flows, cash of 120 Cr on balance sheet, ROE of 25% and is at 50%+ if excluding cash on BS, liberal dividend payouts (Paid Rs. 16.5 out of EPS of 37 for FY11), able & honest management with focus on profitable growth, superior margins etc. Have you ever looked into it, pls provide your inputs ? If not can you pls look into it and provide your valuable feedback on this.
Disclsure - Invested in it but haven't got my complete fill as it moved fast.
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Posted By: shontou
Date Posted: 10/Oct/2011 at 3:06pm
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Kewal Kiran Clothing Ltd has informed BSE that a meeting the Board of Directors of the Company will be held on October 20, 2011, inter alia, to approve the audited financial results of the Company for the quarter ended September 30, 2011 and to consider the declaration of Interim Dividend for the half year ended September 30, 2011. ------------- Every day, self-proclaimed stock market "experts" tell us why the market just went up or down, as if they really knew. So where were they yesterday? |
Posted By: om2112
Date Posted: 20/Oct/2011 at 10:03am
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Q2 2012 RESULTS Sales up by 38 per EBITDA Up by 18 per,Margins at 25 per Pat increased by 22 per,Margins at 18 per. Q2 EPS at 15 and H1 2012 at 2 http://epaper.dnaindia.com/epaperpdf/21102011/20main%20edition-pg13-0.pdf - 5 Ebitda margins declined by 3 per due to advertisement exp for its accessories variant and sponsored Aukland aces team in champion league tounament. Latest presentation http://www.kewalkiran.com/images/Q2_FY2012_Presentation_20.10.11.pdf - http://www.kewalkiran.com/images/Q2_FY2012_Presentation_20.10.11.pdf http://epaper.dnaindia.com/epaperpdf/21102011/20main%20edition-pg13-0.pdf - http://epaper.dnaindia.com/epaperpdf/21102011/20main%20edition-pg13-0.pdf |
Posted By: wildandfree
Date Posted: 20/Oct/2011 at 11:10am
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The trade receivables have gone up a lot...does that mean that business environment has deteriorated? Anyone knows about this stuff? |
Posted By: FutureBull
Date Posted: 23/Dec/2011 at 8:10pm
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everyone is feeling slowdown including value garment retailers. It also explains the steep correction in stock price.
http://www.in.com/news/business/fullstory-fashion-retailers-tread-the-catwalk-with-care-7e9c268b8b466c643a8fc0bc765e5054ab9a660c-0-true.html - link ------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: excel_monkey
Date Posted: 23/Dec/2011 at 8:46pm
What happened to the pricing power
------------- I have a vested interest in the stocks I discuss, therefore I would request you to kindly consider my comments with a pinch of salt and do your own due diligence |