TTK PRESTIGE

Queen of the Indian kitchen

TTK Prestige has emerged as one of the most prestigious players in the segment of kitchen appliances. It operates broadly under three major segments — pressure cooker and pans, non-stick cookware, and kitchen electric appliances. These groups include a number of products like pressure cookers, cookware, gas stoves, domestic kitchen electrical appliances, ovens, toasters and grills, mixers and grinders, kitchen hoods, hobs, cooktops and chimneys, kitchen tools and induction cooktops.

The company’s popular brands include Prestige, Mantra and Prestige Smart Kitchen. It operates around 500 Prestige Smart Kitchen stores all over the country. The company enjoys a high brand recall and spends around 7.5 per cent of its annual sales for brand building and promotional activity.

The company is doing very well on the financial front and the prospects going ahead are all the more promising. Consider:

• With rising demand for its products, the company embarked on an expansion programme during the last three years. The expansion at its Coimbatore and Vadodara facilities has raised the capacity for pressure cookers to around 9 million a year, that of cookware to 15 million and for other appliances like rice cookers and induction cooktops to around 1 million pieces. In its large product basket in the kitchen appliances space, the revenue stream is well diversified with about 48 per cent revenues coming from kitchen appliances, 33 per cent coming from pressure cookers, 15 per cent from cookware and the balance 4 per cent from others.
• The steadily rising demand for the company’s products has enabled it to put up a robust performance on the financial front. During the last 16 years, sales turnover has expanded more than 16 times from Rs 208 crore in fiscal 2006 to Rs 2,722 crore during fiscal 2022, with operating profit shooting up over 22 times from Rs19 crore to Rs 427 crore and the profit at net level surging over 43 times from Rs 7 crore to Rs 305 crore. The compounded sales growth during the last five years is around 9 per cent and profit growth around 15 per cent.
• The company’s financial position is very strong, with reserves at the end of March 2022 standing at Rs 1,782 crore – over 127 times its equity capital of Rs 14 crore and that too after a 1:5 bonus issue in 2019. The company is virtually a debt-free entity and its interest burden for the last year was just around 3 per cent of its sales. It has been paying handsome dividends, the rate for the last year being 600 per cent!
• The company’s Prestige brand is one of the strongest and most trusted in the kitchen appliances space. In the cookware market, the company has a share of 35-40% in terms of value and in volume it is four times the size of its nearest competitor. Similarly, the company is the market leader in value-added gas stoves, industrial cooktops, kettles and electric rice cookers. It is the number 3 player in mixer-grinders. The in-house product development team helps launch new products to expand the product base and improve overall efficiency.
• Currently, of the total domestic sales, about 50% is accounted for by southern states and the balance 50% from the rest of India. TTK is expected to maintain its strong market position over the medium term, driven by its widening distribution network and increasing opportunities in the export market.
• During the last two years, the company has entered product categories adjacent to the kitchen. This adjacent space consists of several distinct product lines – electrical and nonelectrical cleaning products/appliances, water purifiers, electric irons, lanterns, etc.
• The recently launched Tattva range of non-electric water purifiers, vacuum cleaners, etc., has gained trade and consumer acceptance. The company’s shares are quoted around Rs 890. ICICI Securities has set a target of Rs 1,270 and within a year the share rice is expected to cross the Rs 1,000 mark.

PERFORMANCE INDICATORS (Rs. in crore)